Family Dollar Stores will pay a fine of nearly $42 million after pleading guilty to storing products—including food, drugs, medical devices, and cosmetics—in a rodent-ridden warehouse, the U.S. Department of Justice said.
In what federal officials described as the largest-ever monetary criminal penalty in a food-safety case, Family Dollar entered into a plea agreement that includes a fine and forfeiture amount totaling $41.675 million.
The company had been charged with one misdemeanor count of causing Food and Drug Administration-regulated products to become adulterated while being held under insanitary conditions, according to the Justice Department.
The rat-infested distribution center is located in West Memphis, Arkansas. It shipped products to more than 400 regional chains in Alabama, Arkansas, Louisiana, Mississippi, Missouri, and Tennessee.
According to the plea document, Family Dollar started getting reports in August 2020 of mouse and pest issues with deliveries to stores. By the end of that year, certain stores reported getting rodents and rodent-damaged products from the Arkansas warehouse. The company admitted that by no later than January 2021, some employees were aware that the insanitary conditions were causing products to become contaminated—a violation of federal regulations.
“The company continued to ship FDA-regulated products from the warehouse until January 2022, when an FDA inspection revealed live rodents, dead and decaying rodents, rodent feces, urine, and odors, and evidence of gnawing and nesting throughout the facility,” the feds said.
A subsequent fumigation of the facility killed nearly 1,300 rats, the plea agreement stated.
Under the plea deal, Family Dollar and parent company Dollar Tree promised to meet “robust” corporate compliance and reporting requirements for the next three years.
“It is incomprehensible that Family Dollar [didn’t know] about the rodent and pest issues at its distribution center in Arkansas but continued to ship products that were unsafe and insanitary,” stated Brian Boynton, principal deputy assistant attorney general and head of the Justice Department’s civil division.
“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,” Rick Dreiling, chairman and chief executive of Dollar Tree, stated in a company release.
“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.”
Nationwide Drug Recall
In a separate incident last October, Family Dollar issued a recall of multiple products ranging from toothpaste to pain relievers sold at locations in nearly two dozen states.A recall notice at that time said the company was voluntarily recalling some “over-the-counter drugs and medical devices” that had been “stored outside of labeled temperature requirements by Family Dollar and inadvertently shipped” to stores. The affected items were sold from June 1 through Oct. 4, 2023.
The wide range of recalled items includes mouthwash, toothpaste, allergy pills, cold and flu medicine, pain relievers, laxatives, vitamins and more.
Those products were sold in Alabama, Arizona, Arkansas, California, Colorado, Florida, Georgia, Idaho, Kansas, Louisiana, Mississippi, Montana, Nebraska, Nevada, New Mexico, North Dakota, Oklahoma, Oregon, South Dakota, Texas, Utah, Washington, and West Virginia.
No consumer complaints have been reported to date when the notice was issued. The recall instead is being implemented “out of an abundance of caution,” the company said.
