Lumber Liquidators has sued nine insurance carriers for refusing to cover the potential losses the retailer may incur from the lawsuits over its Chinese-made laminate flooring, which allegedly contains unsafe levels of formaldehyde, according to CNBC.
In its lawsuit, the company alleges that the insurance providers “have wrongfully refused to defend (Lumber Liquidators) in accordance with the terms of the commercial general liability insurance policies they issues,” according to CNBC.
The lawsuit, filed April 27 in Wisconsin, is in response to a lawsuit from the insurance carriers. Led by Liberty Mutual and including Travelers Companies and the CNA Group, the carriers claim they can deny coverage for the more than 100 lawsuits that have been filed against Lumber Liquidators over the formaldehyde levels in its Chinese-made laminate flooring, according to the NY Post.
The carrier’s lawsuit claims that their policies contain a “total pollution exclusion” that allows them to deny coverage for “bodily injury” or “personal damage” caused by chemicals in the air, according to the NY Post.
When the dispute became public this week on May 12, Lumber Liquidators’ stock dropped 5.2 percent—from $28.07 to $26.61, its lowest value at the end of trading since April 2012. Their suit also asks the providers to pay back money lost because of the dispute.
Editor's note: The article was modified May 13.