The groups claim that Nike misrepresents working conditions in Asian factories, and is thus in violation of California's fair business laws. In June 1998 a former Chinese inmate filed a lawsuit against Adidas. When he was in a prison camp in China he was forced to stitch Adidas footballs. The outcome of such lawsuits could have tremendous impact on how companies can be pressured with regards to working conditions. Labour activists have been claiming for years that multinational companies have a moral responsibility for working conditions in their entire subcontracting chain.
Codes of conduct are the companies' response to such claims.
It makes them look good in the public eye. Jurisprudence on legal responsibility of companies could give a boost to such demands.