A major dispute has erupted between a women-owned sportswear brand and one of the nation’s largest department store chains. PSK Collective, a New York-based activewear company founded by World Rugby Hall of Famer Phaidra S. Knight, filed a high-profile lawsuit against Kohl’s Corporation in the U.S. District Court for the Eastern District of Wisconsin. The heart of the complaint is that Kohl’s allegedly failed to pay for nearly $8 million in delivered merchandise, constituting a breach of contract, theft by fraud, and intentional misrepresentation.
In a case filed on August 13, 2025, PSK Collective, a New York-based women’s activewear brand, has launched a sweeping lawsuit against Kohl’s Corporation. The suit alleges that Kohl’s failed to pay for nearly $8 million worth of delivered merchandise, committed fraud, and engaged in bad-faith business practices over the course of a multi-year vendor relationship.
According to the filed complaint, PSK Collective entered a vendor agreement with Kohl’s in late 2020. The relationship rapidly expanded, with over 600 purchase orders placed from April 2021 through September 2022. PSK delivered more than 600,000 clothing units and submitted approximately 1,500 invoices. The lawsuit outlines that Kohl’s received all documentation confirming delivery — including purchase orders, bills of lading (many signed by Kohl’s agents), delivery photos, and invoices — yet refused to pay, often citing shifting internal logistical and record-keeping issues.
The suit alleges that Kohl’s never intended to pay for the merchandise, using the PSK brand to boost its own image as a supporter of minority and women-owned businesses, and to generate profits. PSK claims Kohl’s marketed the brand for public relations leverage but failed to provide in-store support as promised. When PSK pressed for repayment, Kohl’s is accused of stringing the company along for over two years with excuses and broken promises before ultimately refusing payment, citing a “statute of limitations” defence as a reason not to pay.
PSK is seeking a range of remedies, including:
- Damages for breach of contract, theft by fraud, intentional misrepresentation, and conversion
- Punitive damages and rescission of the agreement.
- Demands a jury trial.
What Happen’s Next
As of August 24, 2025, Kohl’s has not yet filed a response in federal court and has not provided any public comment. The complaint explicitly calls out Kohl’s alleged “malice and/or reckless disregard” for PSK’s rights. Judge J.P. Stadtmueller has ordered the parties to consider settlement to conserve judicial resources, but no settlement or response has been reported yet.
However, the lawsuit comes at a period of financial tumult for Kohl’s, which recently announced the closure of 27 stores amid declining sales and profits. The retailer’s net sales fell more than 9% in the last quarter, signaling potentially broader operational and financial stresses within the company.
What Retailers Can Learn
This high-profile legal dispute sends critical warnings to the retail industry:
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Contract Compliance: Retailers must ensure diligent compliance with vendor agreements. Nonpayment or using extensive excuses can not only result in costly litigation but damage reputation and vendor relationships.
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Transparency and Documentation: Both parties should meticulously document all stages of contract performance and communication. The PSK complaint underscores the importance of delivery records, signed receipts, and clear written communications.
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Vendor Relations: Promises to minority- or women-owned brands, or to smaller partners in general, must be made in good faith and honored. Using such partnerships as PR leverage without upholding terms could result in fraud allegations and severe reputational harm.
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Legal and Ethical Risk: Attempts to leverage technicalities, such as questionable use of statute of limitations clauses, may compound liabilities if misapplied—especially if contrary to the spirit of the agreement.
Retailers everywhere should take note: strong ethical practices, clear agreements, and robust vendor relations are essential—not only to avoid costly legal battles, but to protect reputation and foster lasting retail partnerships.
