Office Depot 2012 Annual Report Download - page 21
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Item 3. Legal Proceedings.
We are involved in litigation arising in the normal course of our business. While, from time to time, claims are asserted that make
demands for a large sum of money (including, from time to time, actions which are asserted to be maintainable as class action suits),
we do not believe that contingent liabilities related to these matters (including the matters discussed below), either individually or in
the aggregate, will materially affect our financial position, results of our operations or cash flows.
In addition, in the ordinary course of business, our sales to and transactions with government customers may be subject to lawsuits,
investigations, audits and review by governmental authorities and regulatory agencies, with which we cooperate. Many of these
lawsuits, investigations, audits and reviews are resolved without material impact to the company. While claims in these matters may
at times assert large demands, we do not believe that contingent liabilities related to these matters, either individually or in the
aggregate, will materially affect our financial position, results of our operations or cash flows. In addition to the foregoing, State o
f
California et. al. ex. rel. David Sherwin v. Office Depot was filed in Superior Court for the State of California, Los Angeles County,
and unsealed on October 19, 2012. This action seeks as relief monetary damages. This lawsuit relates to allegations regarding certain
pricing practices in California under a now expired agreement that was in place between January 2, 2006 and January 1, 2011,
pursuant to which state, local and non-profit agencies purchased office supplies (the “Purchasing Agreement”) from us. This action
seeks as relief monetary damages. This lawsuit, which is now pending in the United States District Court for the Central District o
f
California after a Notice of Removal filed by the Company. We believe that adequate provisions have been made for probable losses
on one claim in this matter and such amounts are not material. However, in light of the early stages of the other claims and the
inherent uncertainty of litigation, we are unable to reasonably determine the full effect of the potential liability in the matter. Office
Depot intends to vigorously defend itself in this lawsuit and filed motions to dismiss. Additionally, during the first quarter of 2011,
we were notified that the United States Department of Justice (“DOJ”) commenced an investigation into certain pricing practices
related to the Purchasing Agreement. We have cooperated with the DOJ on this matter.
Item 4. Mine Safety Disclosures.
None.
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