Family Dollar Stores was ordered to pay $41.6 million for using a warehouse infested with rodents. They used this warehouse for the distribution of over 400 stores in the Southern region. They distributed goods like food, medical devices, and cosmetics.
This penalty is the largest of its kind. It came after an investigation by the U.S. Food and Drug Administration. The investigation revealed the presence of live and decomposing rodents, rodent waste, urine, and odours. There were also signs of gnawing and nesting at the company’s distribution centre in West Memphis, Arkansas, as stated by the Department of Justice.
Dollar Tree acquired Family Dollar Stores in 2015, and it operates 8,000 stores across 46 states. The company admitted guilt to a misdemeanour charge related to improperly handling goods under unsanitary conditions. This admission was made during a federal court session in Little Rock.
As stated by the Department of Justice, the fine imposed on the company is the largest ever in a U.S. food safety case. According to a plea deal, both Family Dollar Stores and Dollar Tree are required to follow strict corporate reporting guidelines. They are to adhere to the obligations for the next three years.
Acting Associate Attorney General Benjamin C. Mizer emphasised consumers’ rights to expect cleanliness when it comes to products in stores. He said, “When consumers go to the store, they have the right to expect that the food and drugs on the shelves have been kept in clean, uncontaminated conditions.”
Based on the plea agreement, the company received reports of “mouse and pest issues” in August 2020. However, they continued delivering goods to 404 stores across six states until January 2022. The six states include Alabama, Missouri, Mississippi, Arkansas, Tennessee, and Louisiana. The company also mentioned that some employees were aware of the conditions of the warehouse. They knew about the illegal conditions at the warehouse in January 2021, but shipping continued. Shipping of goods continued until the FDA’s investigation in January 2022 uncovered the extent of the infestation. The Department of Justice said that the investigation led to the discovery of 1,270 dead mice during fumigation.
It wasn’t until February 18, 2022, that all products originating from the warehouse, including food, drugs, cosmetics, and medical devices, were recalled. U.S. Attorney Jonathan D. Ross criticised Family Dollar for knowingly shipping unsafe and unsanitary products. He said, “It is incomprehensible that Family Dollar knew about the rodent and pest issues at its distribution centre in Arkansas but continued to ship products that were unsafe and unsanitary.” He stated that such actions not only endanger public health but also undermine consumer trust.
Dollar Tree, the parent company, said it had cooperated fully with the Department of Justice’s investigation and was implementing changes to its safety protocols.
After reaching a complete resolution with the Department of Justice, we are pushing forward with our business transformation, safety protocols, and compliance efforts,” stated Rick Dreiling, Dollar Tree’s Chairman and CEO since March 2022.
“Since assuming the CEO role, we’ve been dedicated to assisting Family Dollar in resolving this long standing issue and substantially strengthening our policies, procedures, and infrastructure to prevent a recurrence of what happened,” he added.
The company announced intentions to reinstate operations at the West Memphis site by Fall 2024. A $100 million investment accompanies this plan to enhance distribution facilities and generate 300 job opportunities.