Lumber Liquidators, a highly profitable chain of 279 retail stores selling engineered wood and laminate flooring products, is one of the nation’s largest flooring companies. Last year the company sold more than $800 million in flooring product and its stock prices soared amid attractive profit margins and news that its aggressive growth plan aimed to double the number of retail outlets in just about every state.
But blogger and investor Xuhua Zhou reveals that some of Lumber Liquidators’ Chinese-made flooring contains levels of formaldehyde that are both illegal and potentially toxic to consumers – a concern that is echoed by several consumers who have installed laminate flooring from Lumber Liquidators in their homes.
Mr. Zhou documented these concerns in a detailed blog post on the subject and in a report he sent to regulators in California, where some of the products are in serious violation of the state’s strict health and safety laws.
“There are reasons to believe the Company has been knowingly selling noncompliant products to consumers and the stated compliance on some of its products is inaccurate,” Mr. Zhou said in his report to the California Air Resources Board.
According to Mr. Zhou, “Lumber Liquidators lacks a proper product quality control system” that allows potentially dangerous products to be sold to unsuspecting consumers. Formaldehyde, the source of Mr. Zhou’s concerns, is a known carcinogen to humans.
Mr. Zhou also warns about the devastating effect the company’s products could have on company investors if it is forced to recall its formaldehyde-laden products, already installed in thousands of homes across the country.
And, he says, while consumers may be aware the laminate products aren’t the best in terms of quality, they are likely completely unaware that the products present a serious risk to their health.
One consumer’s complaint underscores many of the problems others consumers report:
“We installed 1600 sf bella wood floor in my house in 2009. Right after the installation, all of my family members started to have allergic reactions, headache, dry eyes, burning throat, skin rash, etc. We did indoor air pollution analysis, and found a high concentration of formaldehyde (25 times higher than it should be) in my house. Wood floor material analysis found it contains a large amount of formaldehyde in the top finish of the bellawood floor. Please contact me if you have the same experience …”
In his letter to California regulators, Mr. Zhou emphasized the health risks to consumers. “Recently, the National Academy of Sciences confirmed the EPA’s determination that formaldehyde causes cancer in humans. In addition, the National Cancer Institute, the World Health Organization, and the National Toxicology Program have all identified a possible link between formaldehyde exposure and leukemia. Given the evidence presented in this letter, we believe it is appropriate to demand a full investigation and audit of Lumber Liquidators’ inventory and its quality control process.”