LUMBERYARDS

Trex settles mold lawsuit in California

BY HBSDEALER Staff

At a cost capped at $8.25 million plus attorney’s fees, Trex Co. is settling a California lawsuit  connected to mold in an early version of its decking product. 

Trex, the largest manufacturer of wood-alternative decking, said the U.S. District Court for the Northern District of California granted preliminary approval of a settlement agreement that will resolve a nationwide class action lawsuit filed in California alleging certain misrepresentations and defects in Trex’s first-generation composite products relating to mold growth and color issues.

Winchester, Va.-based Trex will provide to qualified claimants a one-time cash payment or the opportunity to receive other relief, including a rebate certificate on its newer-generation shelled products — Trex Transcend and Trex Enhance. 

This relief would be available for any eligible consumer whose first-generation composite product purchased after Aug. 1, 2004, has a certain level of mold growth, color fading or color variation. 

“Our decision to settle the case is by no means an admission of any of the allegations made by the plaintiffs,” said Ronald Kaplan, chairman, president and CEO of Trex. “Trex has steadfastly denied any liability and we were fully prepared to defend our position. We strongly believe we would have prevailed; however, we settled on terms that we feel benefit both our consumers and Trex. This settlement allows our company to avoid additional expensive, time-consuming litigation and to focus on delivering quality products and service to consumers, while providing certain relief to those customers affected by these issues.”

The mold is a result of environmental conditions that affect all outdoor surfaces, not just the Trex products involved in the suit, Kaplan added.

Trex products are stocked in more than 6,000 retail locations, the company said.

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Schrock Cabinetry sponsors Nascar driver Paul Menard

BY HBSDealer Staff

Schrock Cabinetry, a past and present sponsor of the the No. 27 Schrock/Menards Chevrolet, will be putting its clout behind Nascar driver No. 27 Paul Menard in the 2013 Nascar Spring Cup Series Irwin Tools Night Race in Bristol, Tenn.

The race, taking place Aug. 24, will feature Menard on the Bristol Motor Speedway racing for Richard Childress Racing.

"Paul has consistently demonstrated that his speed and resilience knows no bounds," said MasterBrand Cabinets president David Randich. "We’re very excited to be a part of the excitement as Paul and the No. 27 Schrock / Menards Chevrolet take to the track once again."

Schrock Cabinetry, a division of MasterBrands Cabinets, has been serving as a Nascar car sponsor for the past five years together with Menards.

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Lumber Liquidators sets sights on new bicoastal distribution centers

BY HBSDealer Staff

In the most recent phase of its multi-year supply chain optimization initiative, Lumber Liquidators announced its plans to construct a new East Coast distribution center, as well as lease another one in Pomona, Calif.

The new East Coast center in Henrico County, Va., will take place on 110 acres of recently purchased undeveloped land. The planned 1 million-sq.-ft. distribution center will help consolidate its current 750,000 sq. ft. of distribution space spread out among four buildings in Hampton, Va. The company expects a boost in operational efficiency, as well as reduced transportation and occupancy costs to benefit its margin.

Meanwhile, the 500,000-sq.-ft. distribution center in Pomona will be ready for occupancy by November 2013 and will be in full operational mode by the first quarter of 2014. The move aims to strengthen the company’s operating income through improved product availability, reduced international transportation costs and lower delivery costs.

"The consolidation of our East Coast distribution facilities into a new, larger location and the opening of a West Coast distribution center will ensure we can support the tremendous growth of our business and improve service to our expanding customer base," said president and CEO Robert M. Lynch. "These new facilities will provide a more efficient supply chain structure, allowing us to improve the availability component of our industry-leading value proposition, as well as increase our labor productivity and lower our transportation costs. At the same time, we are pleased to be creating additional jobs in California and Virginia through these new facilities. These investments in our supply chain will provide the foundation for our long-term growth — to continue to expand our footprint and capture additional market share in a recovering macro-environment."

The new building in Virginia is due for completion in the third quarter of 2014, and is expected to be funded using existing cash and operating cash flow.

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