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Lumber firm fined $13.2 million for illegal importation of flooring



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Flooring retailer Lumber Liquidators Inc. was sentenced in U.S. District Court in Norfolk, Virginia, and will pay $13.2 million in criminal fines, community service and forfeited assets related to the illegal importation of hardwood flooring, the U.S. Department of Justice said Monday.

The department said much of the flooring was manufactured in China from timber that had been illegally logged in far eastern Russia, in the habitat of the last remaining Siberian tigers and Amur leopards in the world.

The department said the $13.2 million includes $7.8 million in criminal fines; $969,175 in criminal forfeiture and more than $1.2 million in community service payments. The company will also pay $3.2 million in cash through a related civil forfeiture, the department said.

The department said the Toano, Virginia-based company had pleaded guilty in October after being charged with one felony count of importing goods through false statements and four misdemeanor violations of the federal Lacey Act, which makes it a crime to import timber that was taken in violation of the laws of a foreign country and to transport falsely labeled lumber across international borders into the United States.

The company has also agreed to a five-year term of organizational probation and mandatory implementation of a government-approved environmental compliance plan and independent audits.

“This company left a trail of corrupt transactions and habitat destruction. Now they will pay a price for this callous and careless pursuit of profit,” Assistant Attorney General John C. Cruden of the Justice Department's Environment and Natural Resources Division said in a statement.

Liquid Liquidators said in a statement that it “is pleased to put this legacy issue behind us. This matter was concluded consistent with our prior disclosures. We remain focused on our business and are committed to providing our customers with quality flooring at the best price.”

The company, which faces more than 100 lawsuits for allegedly selling Chinese-manufactured laminated flooring that contained unsafe levels of formaldehyde, has filed suit against several of its insurers for their alleged refusal to defend and indemnify it.

A spokesman could not immediately comment on the litigation.