It’s been several months since the story broke on 60 Minutes that Lumber Liquidators’ Chinese-made flooring contains excessive levels of formaldehyde. With the Department of Justice announcing a multi-million dollar settlement with the company, we thought it was time to provide an update as to what’s really going on and how it affects you.
Earlier this month, Lumber Liquidators agreed to pay out more than $10 million to the Department of Justice’s Environment and Natural Resource Division to settle an investigation into the company’s importation of flooring from overseas suppliers that were said to be harvesting more timber than their permits allowed. The DOJ began looking into the company in 2013 – and even raided its headquarters – amidst reports that it was illegally sourcing wood from Eastern Russia, home to the endangered Siberian tiger.
As part of the deal, Lumber Liquidators pled guilty to four misdemeanor violations of the Lacey Act (a federal law that deals with the protection of fish, plants and wildlife), as well as one felony charge for “entry of goods by means of false statements.”
What Does the DOJ Settlement Mean for Consumers?
Unfortunately, not much. The $10 million settlement is comprised of fines, forfeited earnings and community service contributions to organizations like the Rhinoceros and Tiger Conservation Fund and the National Fish and Wildlife Foundation. It does not provide compensation to people who own the company’s flooring. The settlement was only reached to resolve criminal charges – not civil ones.
The Class Action Lawsuits
As of today, there have been 138 lawsuits filed against Lumber Liquidators for selling products containing excessive levels of formaldehyde. In mid-June, the filed lawsuits were consolidated to the U.S. District Court for the Eastern District of Virginia as part of a legal procedure known as multidistrict litigation (MDL).
What Is an MDL and How Can It Help?
MDLs are often created when a large number of lawsuits are filed making similar claims. In an MDL, one judge – in this case, the Honorable Anthony Trenga – will oversee all of the lawsuits rather than having them proceed individually in different courts. MDLs are formed in hopes that they will save time and money for all parties involved by ensuring consistent rulings and avoiding duplicate discovery (the part of the legal process where documents are exchanged, depositions are taken, etc.).
That being said, lawsuits still take time. It may take months or even years for the lawsuits resolve – so for those with Lumber Liquidators flooring in their homes, it’s a bit of a waiting game right now. We will, however, post any new updates we receive here – so be sure to keep checking back.