A bulge in the side of a tire is usually due to damage inside the tire. The reason you see the bulge is probably due to damage to the cord structure, but the air tight liner is still holding air, and bulging.
Some tires bulge naturally, but if you don't see them on all of the tires, then there is probably an issue with the tire.
I've seen some inexpensive tires that bulge where the tire is joined together. (Look inside some tires and you can see where they are spliced together.
Is is possible that it is a manufacturers defect? Sure, but it is also possible that you damaged the tire by hitting a curb or pothole. However, if the tire has a manufacturers defect, they should replace the tire at a minimum at a prorated cost (you only pay for the treadwear you used)
FWIW,
TB
