Family Dollar Pleads Guilty to Holding Products in Rodent-Infested Warehouses, To Pay $41.675 Million Fine

Family Dollar Stores LLC pleaded guilty to holding consumer products in rodent-infested warehouses, The Department of Justice said on Monday. The DOJ released a statement Monday mentioning that the company pleaded guilty to storing food, medical devices, and makeup products under unsanitary conditions at the company's West Memphis, Arkansas, distribution center.

The company has now agreed to pay $41.675 million, which, according to the DOJ, is the largest ever-monetary criminal penalty witnessed in a food safety case. Morrover, it was further revealed that Family Dollar stores too, were not immune to rat infestations. 

"Consumers trust that products purchased from retail stores such as Family Dollar are safe," U.S. Attorney Jonathan D. Ross with the Eastern District of Arkansas said. "It is incomprehensible that Family Dollar knew about the rodent and pest issues at its distribution center in Arkansas but continued to ship products that were unsafe and unsanitary."

A report by WREG in 2022 uncovered that several Family Dollar locations in the Memphis area were plagued by rodents, as confirmed by employees of the chain. Shockingly, the Justice Department disclosed that the rodent problems had started as early as 2020, yet the company failed to take any corrective action and continued its operations, including the delivery of products to its stores. It was only after intervention by the FDA that the extent of the issue came to light.

"U.S. consumers rely on the FDA to ensure that their food is safe and wholesome," said Special Agent in Charge Charles L. Grinstead of the Food and Drug Administration’s Office of Criminal Investigations (FDA-OCI) Kansas City Field Office.

"When companies put themselves above the law and distribute food that has been held under extremely unsanitary conditions, putting the public’s health at risk, we will see that they are brought to justice."

The FDA disclosed that over 2,300 live rodents were discovered at the West Memphis facility, and they were caught by the FDA in 2021. Furthermore, an inspection conducted by the Department of Justice unveiled a grim reality: the facility was teeming with live rodents, along with dead and decaying ones, rodent feces, urine, odors, and clear signs of gnawing and nesting throughout the premises.

As a consequence of these alarming findings, the West Memphis distribution center was forced to cease operations in 2022.

"Having reached a full resolution with the DOJ, we are continuing to move forward on our business transformation, safety procedures, and compliance initiatives," said Family Dollar’s Chairman and CEO Rick Dreiling in a statement. "When I assumed the CEO role, 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."

In February 2022, Dollar Tree issued a voluntary recall of all drugs, medical devices, cosmetics, and human and animal food products sold since January 2021. This encompassed items distributed to the 404 stores serviced by the affected warehouse.

This incident marked another instance of the company recalling products from its stores. Previously, in October, Dollar Tree had to recall hundreds of consumer products sold in 23 states due to being stored at incorrect temperatures. Presently, the retailer operates 16,622 stores across 48 states in the United States and Canada.