US retailer stands by flooring made at factory in China

Shares of Lumber Liquidators - North America's largest specialty retailer of hardwood floor - closed down 25 percent on Monday following a report on "60 Minutes" that showed a factory in China making laminate flooring that the TV program said exceeds California's standards for formaldehyde, a chemical linked to cancer.

The CBS-TV report on Sunday said the laminated lumber being made in China was deliberately mislabeled to show that it complied with California regulations when it did not. The program showed footage of a factory in China that it said was compiled by investigators hired by 60 Minutes.

Lumber Liquidators' shares were halted on the New York Stock Exchange for nearly two hours after the opening bell on Monday and then resumed trading. The stock closed at $38.83.

The Toano, Virginia.-based company, which has 352 stores in the United States and Canada, did not return a phone call from China Daily seeking comment about the TV program.

It issued a statement on Monday that accused 60 Minutes of using an "improper test method" that isn't included in California's regulations. Lumber Liquidators said it complies with applicable regulations regarding its products, including California standards for formaldehyde emissions.

According to the TV report, the Chinese-made laminate flooring exceeds formaldehyde standards in California, even though Lumber Liquidators labels the product as CARB Phase 2 Compliant. Those emissions regulations were approved by Congress in 2010 and will be implemented nationwide this year.

60 Minutes said it is legal for flooring to contain formaldehyde, which is found in the glue that manufacturers use to produce composite wood products like fiberboard, which forms the base of laminate flooring. The laminated top, which covers the core board, keeps most of the formaldehyde emissions inside. But formaldehyde does leak into the air. How much is inhaled by homeowners depends on how much formaldehyde is in the glue and how much ventilation is in the home.

60 Minutes said it tested Lumber Liquidators' flooring in Virginia, Florida, Texas, Illinois and New York for levels of formaldehyde. "Out of the 31 samples of Chinese-made laminate flooring, only one was compliant with formaldehyde emissions standards. Some were more than 13 x over the California limit," according to CBS.

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