A 60 Minutes investigation found the company falsely claimed its flooring complied with the California Air Resource Board’s maximum acceptable limits for formaldehyde emissions.
A settlement was approved this week in district court for Lumber Liquidators to pay $36 million to settle a class-action lawsuit filed on behalf of 760,000 customers who bought its Chinese-made laminate flooring between 2009 and 2015. The settlement comes after a seven-month 60 Minutes undercover investigation of the nation's largest hardwood retailer, which found Lumber Liquidators falsely claimed its flooring complied with California Air Resource Board's maximum acceptable limits for formaldehyde emissions. After the investigation, the company halted the sale of Chinese made laminate flooring in the U.S., and a number of top company executives, including its founder, Tom Sullivan, left the company.
Lumber Liquidators' stock decreased from a high of $114.19 a share in October 2013 to an October 2018 price of $13.93 per share. The company has also paid millions of dollars in regulatory fines and destroyed millions of dollars in nonconforming inventory. Lumber Liquidators paid $2.5 million in fines to California's Air Regulation Board and agreed to destroy 22 million board feet of flooring it pulled from shelves in May 2015, following the 60 Minutes report.
Click here to view the the 60 Minutes report, which originally aired March 1, 2015.