Lumber Liquidators’ stock drops after report of unacceptable levels of formaldehyde in product

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DENVER -- Stocks took a nose-dive Monday for Lumber Liquidators after a report on the CBS news program "60 Minutes" claiming the company is using laminate with unacceptable levels of formaldehyde.

In Colorado, there are seven Lumber Liquidators stores.

It’s not uncommon for laminate flooring to contain formaldehyde. But, according to the "60 Minutes" investigation, Lumber Liquidators is selling products made in China with levels off the charts.

Dr. Chris Hoyte, a toxicologist at the University of Colorado Hospital, said that could be problematic, especially for children, if true. "The lower you are to the ground, the higher the concentration of formaldehyde would be."

It depends, he said, on how much and for how long someone is exposed. Formaldehyde exposure can lead to respiratory problems and even nose or throat cancer.

Denver resident Betty Pickett bought 54 pallets of laminate from Lumber Liquidators over the weekend. Her laminate shows a Made In The USA sticker, but she said after the report, she isn’t sure. "Labels can lie and people can lie,” she said. "It's all about money."

Other consumers with similar concerns are flooding social media. The company said it’s committed to transparency. We reached out to Lumber Liquidators. The company responded and said it’s a “leader in safety.” The company also added, as recently as late 2014, independent testing confirmed 100 percent compliance.

Still, despite the company’s claims of compliance, customers like Pickett are waiting to decide what to do. She said, "I don't know yet."

Dr. Hoyte said if you’ve installed laminate in your home and you’ve noticed breathing problems or a sore throat, you need to have the air in your home tested to make sure it’s safe.

Here is the full statement form the company:

"Lumber Liquidators is a leader in safety, as evidenced by our track record of providing our wide range of products to two million satisfied customers across America.

We comply with applicable regulations regarding our products, including California standards for formaldehyde emissions for composite wood products ­ the most stringent rules in the country -- and take our commitment to safety even further by employing compliance personnel around the world and utilizing the latest in cutting-edge technology to provide our customers with top quality and high value flooring.

These attacks are driven by a small group of short-selling investors who are working together for the sole purpose of making money by lowering our stock price. They are using any means to try and scare our customers with inaccurate allegations. Their motives and methods are wrong and we will fight these false attacks on all fronts.

As recently as late 2014, testing by independent third parties confirmed that 100 percent of the randomly selected cores used in the laminates from the factories that 60 Minutes investigated came back as fully safe and compliant with California standards. While we were unable to witness 60 Minutes¹ testing methods and have still yet to see a test using validated methods that has come back as anything but completely safe, out of an abundance of caution, we are now reviewing our processes at these mills.

We stand by every single plank of wood and laminate we sell all around the country and will continue to deliver the best product at the best price to our growing base of valued customers."