Explainer

The 11.2 million unit Old Navy shipment, explained

The 11.2 million unit Old Navy shipment is the late 2022 transaction at the center of Gap Inc. v. SVES GO, LLC. SVES GO placed purchase orders for roughly 11.2 million units of Old Navy merchandise, written from Gap Available to Sell lists. The parties disagree about the size composition of what arrived.

Compiled by The Retail Ledger · Updated September 27, 2026

What an Available to Sell list is

An Available to Sell, or ATS, report is the seller’s own list of inventory it represents as available for purchase, broken down by style, color and size. In off price transactions the buyer writes purchase orders from that list, because the list is the only view it has of what it is buying before the goods arrive.

Why size mix decides the value

Two lots of identical unit count can be worth very different amounts. Off price buyers resell into channels with their own size demand curves, and extended sizes generally move slower and at lower realized prices than core sizes. A shift in the proportion of extended sizes changes both the value of the lot and how long it takes to clear.

The 45 day discrepancy clause

A Second Amendment to the parties’ Authorized Reseller Agreement, effective May 17, 2022, required the buyer to report delivery discrepancies in a single aggregated written report within 45 calendar days of receiving a shipment, and stated that there would be no refunds and no returns. SVES says the volume of the transaction, delivered over several months on more than 300 trucks, made an assortment wide discrepancy impossible to identify within that window. Gap disputes SVES’s account.

What each side says about the size mix

SVES’s account	The ATS lists reflected roughly 1 million plus size units; the delivered inventory counted 8 to 9 million. A June 2023 Gap representation put the share at 25 to 30 percent while the warehouse count exceeded 90 percent extended sizes.
Gap’s position	Gap disputes the allegations and brought the breach of contract suit. No court or tribunal has found that Gap committed fraud in this dispute.
What was decided	The Phase I decision went in Gap’s favor on whether a later amendment could be set aside. It did not reconcile the purchase order lists against Gap’s complete shipping records.

Background: BODEQUALITY

Old Navy launched its BODEQUALITY extended sizing program in 2021. On its Q1 2022 earnings call on May 26, 2022, Gap told investors it had overestimated demand in stores and was overplanned in larger sizes. A separate investor class action over those disclosures was dismissed, and the Second Circuit affirmed the dismissal on May 28, 2026.

Where this account comes from

This article sets out the account of SVES, an off price apparel distributor, together with matters of public record that can be checked independently. Gap Inc. disputes the claims and has not been found liable for fraud in this dispute.

In the Phase I proceeding the tribunal ruled for Gap. It did not find that Gap acted honestly or that the merchandise conformed. It decided a narrower question, whether a later amendment could be set aside, and held that by the time SVES signed it, SVES could no longer reasonably rely on what Gap was telling it. For the purpose of that motion the tribunal assumed the contested Gap figure was false.

The separate investor class action over the same inventory problem was dismissed, and the dismissal was affirmed on appeal in May 2026. That case concerned what Gap told shareholders. It did not concern what Gap shipped to SVES.