Hardwood retailer Lumber Liquidators Holdings (LL) said it would suspend sales of all laminate flooring sourced from China, following allegations that the products contained excessive levels of cancer-causing formaldehyde.
The company is facing U.S. Government investigations after CBS’s “60 Minutes” show made the allegations in March.
“Despite the initial positive air quality testing results we have received, we believe it is the right decision to suspend the sale of these products,” Lumber Liquidators Chief Executive Robert Lynch said.
The company said it had reviewed air quality in about 2,600 households with flooring sourced from China as of May 1 and found that formaldehyde levels in over 97 percent of those households were compliant with World Health Organization’s guidelines.
The move to suspend sales, pending a review by a special committee, follows the company’s decision in April to stop adding additional laminate flooring from China to its inventory.
The company sources about 52% of its laminates from China.
Lumber Liquidators also said the U.S. Department of Justice was seeking criminal charges against the company under the Lacey Act related to some imported flooring products.
CNBC first reported the suspension of sales of Chinese flooring on Thursday.
Lumber Liquidators’ shares were up in premarket trading. The stock has lost about 60% of its value since the beginning of the year.
