Dollar Tree 2014 Annual Report Download - page 69

Download and view the complete annual report

Please find page 69 of the 2014 Dollar Tree annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 100

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100

53
In September 2013, district attorneys in California initiated an investigation of whether the Company properly disposed of
certain damaged retail products under Federal and California state environmental law, primarily the Resource Conservation and
Recovery Act. The Company is in the process of settling this matter and has fully accrued its estimated loss which is
immaterial.
In May 2014, the US Consumer Product Safety Commission ("CPSC") began a staff investigation of circumstances related
to Letters of Advice that the Company received from the CPSC from 2009 to 2013. The CPSC is now investigating Letters of
Advice the Company received in 2014 and 2015. The outcome of this matter cannot be determined at this time.
In July and August 2014, several shareholders of Family Dollar Stores, Inc. (“Family Dollar”) filed class actions, now
consolidated into one class action, in Delaware chancery court against Family Dollar’s CEO and board members alleging
breach of fiduciary duty. Dollar Tree and Family Dollar were also named as defendants for allegedly aiding and abetting the
other defendants. The claimed breach derives from the execution of the merger agreement dated July 27, 2014, between Dollar
Tree and Family Dollar, which is alleged to offer unfair and inadequate consideration for Family Dollar stock. The class action,
among other things, seek to prevent the merger, obtain higher merger consideration or seek monetary damages. The Delaware
Chancery Court and appellate court refused to issue an injunction against the Family Dollar shareholder vote in favor of the
merger.
The Company will vigorously defend itself in these matters. The Company does not believe that any of these matters will,
individually or in the aggregate, have a material effect on its business or financial condition. The Company cannot give
assurance, however, that one or more of these lawsuits will not have a material effect on its results of operations for the period
in which they are resolved. Based on the information available to the Company, including the amount of time remaining before
trial, the results of discovery and the judgment of internal and external counsel, the Company is unable to express an opinion as
to the outcome of these matters and cannot estimate a potential range of loss except as specified above.
Resolved
A supermarket filed a lease exclusive case and a second companion unfair competition case against the Company in a
Pennsylvania state court. These two cases were settled in fiscal 2014 for immaterial amounts.
A supermarket filed a lease exclusive case against the Company in Pennsylvania state court. This case was settled for an
immaterial amount in fiscal 2014.
In 2012, two former store managers, under California's Labor Code and PAGA, instituted suit in the federal court in
California on behalf of themselves and others alleged to be similarly aggrieved in the state of California, alleging they were
misclassified by the Company as exempt employees. The Company settled with one plaintiff for an immaterial amount. The
Company prevailed at trial in November 2013 with the other plaintiff. A final Order has been entered in favor of the Company
and the Plaintiff waived his right to appeal.