I'm lucky in that I have 4 Walmarts that are close enough for me to shop. 2 have always had decent sewing/craft depts. with great knowledgeable employees and two have next to nothing.
I've never heard anything about a lawsuit but it could have happened. I do know that about 5 years ago when it became widely known that Walmart was closing out the regular fabric depts. across the country there was a massive letter writing campaign asking them to bring it back. Thousands of women across the country boycotted Walmart and let them know why.
Cari