Dillard's 2005 Annual Report Download - page 13

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• sales promotions by us or our competitors;
• changes in average same-store sales and customer visits;
• variations in the price, availability and shipping costs of supplies;
• seasonal effects on demand for our products;
• changes in competitive and economic conditions generally;
• changes in the cost or availability of material or labor; and
• weather and acts of God.
Litigation from customers, employees and others could harm our reputation and impact operating results.
Class action lawsuits have been filed, and may continue to be filed, from customers alleging discrimination.
We are also susceptible to claims filed by customers alleging responsibility for injury suffered during a visit to a
store. Class action lawsuits have also been filed, and may continue to be filed, against the Mercantile Stores
Pension Plan (the “Plan”) and the Mercantile Stores Pension Committee (the “Committee”) on behalf of a
putative class of former Plan participants. The complaint alleges that certain actions by the Plan and the
Committee violated the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), as a result
of amendments made to the Plan that allegedly were either improper and/or ineffective and as a result of certain
payments made to certain beneficiaries of the Plan that allegedly were improperly calculated and/or
discriminatory on account of age. In addition to decreasing our sales and profitability and diverting management
resources, adverse publicity or a substantial judgment against us could negatively impact our operating results
and our reputation, hindering the ability to attract and retain customers.
Further, we may be subject to other claims in the future based on, among other things, employee
discrimination, harassment, wrongful termination and wage issues, including those relating to overtime
compensation. These types of claims, as well as other types of lawsuits to which we are subject to from time to
time, can distract management’s attention from core business operations and/or negatively impact operating
results.
Catastrophic events may disrupt our business.
Unforeseen events, including war, terrorism and other international conflicts, public health issues, and
natural disasters such as earthquakes, hurricanes or other adverse weather and climate conditions, whether
occurring in the United States or abroad, could disrupt our operations, disrupt international trade and supply
chain efficiencies, suppliers or customers, or result in political or economic instability. These events could reduce
demand for our products or make it difficult or impossible to receive products from suppliers.
ITEM 1B. UNRESOLVED STAFF COMMENTS.
None.
5