If you build or market a modern consumer brand, influencer partnerships are likely the engine driving your growth. For over a decade, activewear giant Gymshark built an empire on social media, turning fitness creators into "Gymshark Athletes" whose posts looked like genuine, organic love for the apparel.
However, in June 2026, a major class action lawsuit (Lupea v. Gymshark USA, Inc.) was filed in federal court in New York, exposing a massive legal vulnerability in that exact strategy.
The lawsuit alleges that Gymshark systematically compensated creators to promote its apparel on Instagram and TikTok without ensuring proper disclosures, misleading consumers into believing the posts were organic recommendations. Even worse, the complaint alleges that Gymshark actively encouraged creators to skip disclosures and failed to reveal that these influencers were locked into strict non-compete contracts.
For lifestyle brands and content creators alike, this case is a massive wake-up call. What used to be viewed as a slap-on-the-wrist regulatory issue with the FTC has officially escalated into full-blown consumer protection class action litigation.
What Is the Gymshark Influencer Class Action Lawsuit About?
The lawsuit centers on the fundamental rule of endorsement transparency: when a creator endorses a product, consumers have a legal right to know if that creator is being compensated.
Under Federal Trade Commission (FTC) guidelines, any "material connection" between a brand and an influencer—whether that is cash payment, free product, or affiliate commissions—must be clearly and conspicuously disclosed. Disclosures cannot be buried at the end of a long caption, hidden behind a "see more" button, or stuffed into a cluster of thirty hashtags.
The complaint alleges that Gymshark built its core brand image around the illusion that everyday fitness enthusiasts simply preferred Gymshark products over all others. By omitting clear tags like #ad or #sponsored, the posts performed better in social media algorithms, driving sales from consumers who paid premium prices believing the endorsements were 100% organic.
While the FTC itself enforces these rules at the administrative level, plaintiffs' attorneys are now using state consumer protection statutes,like New York General Business Law, to file private class action lawsuits directly against brands.
The Non-Compete Twist: Why Exclusivity Deals Are Raising New Red Flags
What makes the Gymshark lawsuit uniquely dangerous compared to earlier influencer cases is the allegation surrounding exclusivity agreements.
In traditional influencer marketing, brands often include non-compete clauses prohibiting creators from wearing or promoting rival products during their contract term. The lawsuit argues that failing to disclose these non-compete agreements actively misleads the public. When a creator wears one brand exclusively, viewers assume it is because they genuinely love that gear above everything else, completely unaware that the creator is legally barred from wearing anything else.
Why Disclosure Compliance Is a Shared Risk for Brands and Creators
For years, brands assumed that if a creator forgot to add #ad to a TikTok post, the creator was the one taking on the risk. Conversely, creators assumed that if a brand didn't explicitly instruct them to add a disclosure, it wasn't their responsibility.
The Gymshark litigation and similar suits brought by the FTC prove that both assumptions are wrong.
Brands are legally responsible for monitoring their creator networks, providing clear disclosure guidelines, and enforcing compliance across every campaign. When a brand turns a blind eye—or worse, implicitly encourages creators to ditch disclosures to boost engagement- the brand exposes itself to catastrophic class action damages and FTC enforcement.
For creators, failing to properly disclose paid deals damages audience trust and can violate platform terms of service, jeopardize brand partnerships, and create personal liability under federal endorsement guidelines.
How to Protect Your Brand and Creator Deals from Litigation
If you are a lifestyle brand running influencer campaigns or a creator entering paid partnerships, you cannot treat legal compliance as an afterthought. Protecting your business requires proactive systems:
First, audit your creator contracts. Brand agreement templates must explicitly mandate compliance with FTC Endorsement Guides and clearly specify how and where disclosures must appear on every platform.
Second, establish an active monitoring protocol. Brands cannot simply send out free product and hope for the best; you need a system to review sponsored content as it goes live to ensure compliant tags are visible above the fold.
Third, train your team and talent. Ensuring that marketing managers and partnered creators understand the specific placement rules for Instagram Stories, TikTok videos, and YouTube Shorts is the single most effective way to insulate your company from predatory class action lawsuits.
Frequently Asked Questions
What are the FTC requirements for influencer disclosures?
The FTC requires creators to clearly and conspicuously disclose any material connection to a brand. The disclosure must be easy to see and understand, placed where viewers will not miss it (such as superimposed on a video or at the start of a caption), using simple language like #ad or Paid Partnership.
Can brands be sued if an influencer fails to disclose a paid partnership?
Yes. While the FTC enforces disclosure rules at the federal level, plaintiffs' attorneys are now actively filing class action lawsuits—like the recent suit against Gymshark—under state consumer protection laws. Even though these cases are still making their way through the courts, facing a class action complaint alone carries massive financial and reputational risk for brands.
Audit Your Influencer Strategy Today
Don’t let loose creator contracts or missing disclosures expose your brand to litigation or hefty FTC fines. Let's review your influencer agreements, compliance guidelines, and digital marketing strategy to ensure your business is fully protected. Contact Abrams Law today to schedule a consultation.
About the Author: This article was written by Courtney Abrams, Esq. Courtney Abrams is an e-commerce attorney and the founder of Abrams Law, a Phoenix-based boutique law firm focused on digital marketing, intellectual property strategy, and comprehensive brand protection for lifestyle brands, content creators, and online shops nationwide.
Disclaimer: The information provided in this post is for general educational purposes only and does not constitute formal legal advice or establish an attorney-client relationship. If you need legal assistance securing your assets, please schedule a formal consultation directly with our firm.
