A lawsuit accusing Lululemon Athletica Inc of defrauding shareholders by hiding defects in its yoga pants should be dismissed, a U.S. judge has concluded, in a case that involved a costly recall.

In a draft decision released on Friday, U.S. District Judge Katharine Forrest in Manhattan rejected claims the Canadian company cost investors roughly $2 billion by having concealed problems in manufacturing and marketing its yoga pants.

A judge has dismissed a lawsuit accusing Lululemon Athletica of defrauding shareholders by hiding defects in the company's yoga pants.

Forrest on Friday also issued a draft decision that dismissed a separate lawsuit seeking to hold 13 current and former Lululemon executives and directors liable for mismanagement.

The judge is expected to hold a hearing to review whether she should make the decisions final.

First published April 4 2014, 8:22 AM

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Judge Says Lululemon Yoga Pants Lawsuit Should Be Dismissed