LL Class Action Lawsuits Extend Beyond Formaldehyde Issue

Toana, VA, March 11, 2015—Lumber Liquidators is currently facing at least 12 class action lawsuits.

BloombergBusiness reports that Lumber Liquidators Holdings Inc. directors have been accused by an investor of engaging in insider trading by selling shares while knowing the company faced potential criminal charges over imports of Chinese flooring that came from the illegal harvesting of trees.

Thomas Sullivan, Lumber Liquidator’s founder and board chairman, along with chief executive officer Robert Lynch, are accused of using nonpublic information to decide when to sell a combined $19 million worth of stock, an investor claims in a lawsuit in Delaware Chancery Court.

The stock sales “were unusual and well-timed to take advantage of the inflated stock price before the true facts regarding the company’s operations were revealed to the market,” James Costello, a Lumber Liquidators shareholder, said in the suit filed March 6 in Wilmington, Delaware.

In addition, as of Monday, across the country, eleven class actions had been filed claiming that “…Lumber Liquidators falsely advertises that its Chinese-made laminate flooring complies with state and federal formaldehyde limits,” reports Courthouse News Service.