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Experts On Lumber Liquidators Call: First Admission Of Guilt?

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Lumber Liquidators Holdings Inc (NYSE: LL) conducted a conference call on Thursday in which it defended the safety of its products and also offered free testing kits to consumers.

However, class action lawsuit attorney against Lumber Liquidators, Richard Drury, and Hardwood Plywood & Veneer Association President, Kip Howlett, were not too satisfied by the arguments made by the company.

Drury and Howlett were on Fox Business after the conference call to weigh on it.

Admitting Failing Tests For The First Time

"I think, the most important thing that came out of today's press conference was Lumber Liquidators admitted [at] page 9 or 15 of their prepared script that the California Air Resources Board has tested Lumber Liquidators products and several of them failed the California formaldehyde test," Drury said.

Related Link: Whitney Tilson Gives New Response To Lumber Liquidators, Says Company Has 'Campaign Of Distraction And Deception'

"This is the first time that Lumber Liquidators has admitted that its products have failed the California formaldehyde test done by the California regulatory agency."

He continued, "So, now it's not just 60 Minutes that conducted 30 tests (and Lumber Liquidator failed all but one of those tests)."

No Real Active Enforcement

"I think the issue here really is there's no U.S. government agency nor the State of California that can go to China to basically enforce the standards that we have in place in the Unites States," Howlett said.

"So, you have to rely on the chain of commerce to basically enforce the regulation and I think that probably the most telling piece of 60 Minutes was when they had the Chinese manufacturer on camera and he showed the two boxes -- both were saying that they were CARB 2 certified...he said one is and one isn't. One costs more, one costs less."

He added: "There's no real active enforcement in the United States, because right now, the only emission standard in place at these new lower levels is California...it's only for products sold in California; we have really not seen lots of enforcement out of them."

Posted-In: CNBC Media

 

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