Lumber Liquidators settles $26M class-action lawsuit

Home Inside FCNews Lumber Liquidators settles $26M class-action lawsuit

Toano, Va.—Lumber Liquidators has settled a class-action investor lawsuit by issuing 1 million shares of its common stock with a value of $16.8 million, according to a recent regulatory filing. The shares were issued Thursday, Nov. 17. The value was based on a $16.76 per share closing price.
According to the filing, the U.S. District Court in Richmond granted final approval of the proposed settlement. The court also entered a final judgment dismissing all claims in lawsuits involving securities and derivatives.

As part of the securities lawsuit, the company expects to contribute, through its insurers, $26 million in cash to a settlement fund in the fourth quarter, according to the filing.

The derivatives lawsuit will be settled for a combination of corporate governance changes, the $26 million cash payment and attorneys’ fees of $5 million.
Lumber Liquidators has dealt with lawsuits from investors and been investigated by federal agencies since “60 Minutes” ran a segment in March 2015 reporting that the company sold flooring made in China that had unsafe formaldehyde levels, which could increase cancer risks.

The company repeatedly has said the flooring poses no safety issues and it has tested the air quality in more than 32,000 homes.

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