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Lumber Liquidators’ battle with its product-liability insurers sent the stock down 5.2 percent on Tuesday.
Nine of the hardwood flooring retailer’s insurers are refusing to pay litigation costs associated with the 103 class-action lawsuits filed against the Toano, Va., company over its Chinese-sourced laminated floors.
The lawsuits snowballed after a “60 Minutes” exposé alleged the floors had excessive levels of formaldehyde, a carcinogen that the US government is cracking down on.
The insurers, led by Liberty Mutual, sued the retailer claiming the policies contain a “total pollution exclusion” provision that bars coverage for “bodily injury” or “personal damage” because of the discharge of chemical pollutants into the air.
The company has countersued its insurers in a Wisconsin state court hoping to force them to defend the 103 lawsuits.
The retailers’ shares, down 58 percent already this year, closed Tuesday at $26.60.



