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Family Dollar Pleads Guilty

Distribution center aerial view.

Dollar Tree Inc. said Monday that it has entered a plea agreement with the Consumer Protection Branch of the U.S. Department of Justice’s Civil Division and the U.S. Attorney’s Office for the Eastern District of Arkansas regarding the DOJ’s investigation into the operations at Family Dollar’s distribution center in West Memphis, Arkansas. Family Dollar is a subsidiary of Dollar Tree.

Under the agreement, Family Dollar has plead guilty to a one-count misdemeanor relating to acts that caused FDA-regulated products held in Family Dollar Distribution Center 202 to become adulterated. Family Dollar will pay $200,000 in fines and $41,475,000, which is the value of the adulterated FDA-regulated products that were held in the distribution center.

The case has been ongoing since March 1, 2022, when a federal grand jury subpoena was issued to Family Dollar requesting information, documents, and records on legal compliance regarding certain products that may have become contaminated, said Dollar Tree. 

“Having reached full resolution with the DOJ, we are continuing to move forward on our business transformation, safety procedures, and compliance initiatives,” said Dollar Tree chairman and CEO Rick Dreiling in a statement. “When I joined Dollar Tree’s Board of Directors in March 2022, I was very disappointed to learn about these unacceptable issues at one of Family Dollar’s facilities. Since that time and even more directly when I assumed the role of CEO, we have worked diligently to help Family Dollar resolve this historical matter and significantly enhance our policies, procedures, and physical facilities to ensure it is not repeated.”

The retailer said that it is committed to selling quality food and products, maintaining a safe environment for associates and customers, and complying with all laws and regulations. 

As part of the effort, Family Dollar initiated a voluntary recall of all FDA-regulated products shipped from DC 202 and decommissioned the site. Additionally, Dollar Tree and Family Dollar are working to strengthen compliance and safety programs and capabilities.

Dollar Tree also said that Family Dollar plans for operations to return to West Memphis with a new distribution center that emphasizes safety, sanitation, and compliance. It is expected to open in fall 2024.