Hardwood flooring retailer Lumber Liquidators (LL) finally got a break on Tuesday, when the company`s share rose 5.8 percent to $29.58. For the last few days the company was accused of selling laminate wood with high levels of formaldehyde, a known chemical which can cause cancer in an episode of “60 Minutes” report.
It was reported that, the Virginia based company denied the allegation that they were selling laminating flooring with higher than the level of formaldehyde that had been set by the California Air Resources Board. The company accused the show for spreading “inaccurate allegations”.
Shares of Lumber Liquidators have plummeted more than 40% since the initial airing of the “60 Minutes” report, as California regulators launched an investigation into the safety of the company’s products, as exposure to formaldehyde can cause immediate health problems like respiratory and sinus effects. But health experts said, the effects of long-term exposure to formaldehyde remain unclear. Marilyn Howarth, a toxicologist at the University of Pennsylvania’s Perelman School of Medicine said, “Any exposure to a carcinogen can increase your risk of cancer”.
The CBC`s “60 Minutes” report was mainly focused on the company’s laminate flooring that is manufactured in China. The program tested their products and discovered that the level of formaldehyde is six times higher than the legal limit in California. But company spokesperson said, their product had passed the regulatory tests set by the authority.
Market experts are also expecting the company to address Wall Street concerns regarding their insufficient cash or liquidity to survive the fallout from the “60 Minutes” scandal. It was previously reported that, U.S. Senator Bill Nelson, (D-FL), has called for a federal inquiry into the practices of Lumber Liquidators and sent a letter to the Consumer Product Safety Commission (CPSC), CDC and the FTC. The report is expected to be published on Tuesday.