CHESAPEAKE, Va. - Dollar Tree, Inc. (NASDAQ: NASDAQ:DLTR) has reached a settlement with the U.S. Department of Justice (DOJ) over an investigation into its subsidiary Family Dollar's distribution center in West Memphis, Arkansas. The company has agreed to a plea deal following a probe into the handling of FDA-regulated products at the facility.
Family Dollar will plead guilty to a misdemeanor charge related to the adulteration of products at its Distribution Center 202 (DC 202). The settlement includes a $200,000 fine and a forfeiture of $41,475,000, which corresponds to the value of the contaminated products.
The agreement acknowledges the company's "extensive cooperation" during the investigation, which began with a subpoena issued on March 1, 2022. The DOJ's inquiry focused on compliance with laws regarding the contamination of certain products at the distribution center.
Dollar Tree Chairman and CEO Rick Dreiling expressed disappointment over the issues, emphasizing the company's efforts to prevent future occurrences. Since assuming leadership, Dreiling has overseen the implementation of new safety and compliance measures.
These improvements include the creation of new roles such as a Chief Legal Officer and a Chief Ethics and Compliance Officer, as well as senior positions in Food Safety, Product Quality, and Regulatory Compliance. Each of the company's distribution centers has also achieved Good Distribution Practices certification after passing independent audits.
Family Dollar initiated a voluntary recall of all FDA-regulated products from DC 202 and has decommissioned the site. Dollar Tree plans to return to West Memphis with a new, reimagined distribution center by fall 2024, which represents an investment of over $100 million and is expected to create more than 300 jobs. This facility will emphasize safety, sanitation, and compliance, serving as a model for other centers in the network.
Dollar Tree, a Fortune 200 company, operates over 16,000 stores across the United States and Canada. This settlement concludes the legal issues stemming from the West Memphis distribution center, allowing the company to focus on its business transformation and compliance initiatives.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.