Lumber Liquidators will reportedly stop selling its laminate flooring sourced in China.
The home improvement retailer instructed 356 stores to remove the product on Wednesday, CNBC reported, citing a source with knowledge of the communications.
The stock rose by up to 3% in pre-market trading.
It’s down 47% since March 1, when CBS’ “60 Minutes” aired a documentary that detailed apparent violations of regulatory standards on laminate flooring sourced from China.
The team tested samples of Lumber Liquidators’ flooring and found that it had levels of formaldehyde that exceed the limits set by the California Air Resources Board.
Lumber Liquidators said the team used an “improper method.”
The Department of Justice is seeking criminal charges against the company under the Lacey Act, related to its imported products. The Consumer Product Safety Commission is also investigating the issue.
On April 29, the Lumber Liquidators shares tumbled by more than 16% after the company reported first quarter earnings that missed investors’ expectations.
In the release, the company said legal expenses dragged down earnings; it is aware of 103 class-action lawsuits that were filed since the “60 Minutes” episode aired.
Business Insider has reached out to Lumber Liquidators, and we’ll update this post if we hear back.
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