Wal-Mart to pay $27.6 million over toxic waste case

NEW YORK Mon May 3, 2010 3:48pm EDT

Shoppers cart their purchases from a Wal-Mart store in Alexandria, Virginia November 12, 2009. REUTERS/Richard Clement

Shoppers cart their purchases from a Wal-Mart store in Alexandria, Virginia November 12, 2009.

Credit: Reuters/Richard Clement

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NEW YORK (Reuters) - Wal-Mart Stores Inc, the world's largest retailer, will pay $27.6 million to settle a lawsuit alleging it improperly stored, handled and dumped hazardous waste at stores throughout California, state investigators said on Monday.

The accord ends a five-year probe in which California investigators said they found violations at 236 Wal-Mart and Sam's Club stores, distribution centers and storage facilities in the state.

Wal-Mart was accused of improperly dumping hazardous waste such as acid, aerosols, chemicals, fertilizer, motor oil, paint and pesticides.

In one instance, according to an April 2 court filing, investigators in April 2002 observed "piles of multicolored

unknown fertilizer type substances and torn sacks of ammonium sulfate" at a Wal-Mart store in Vacaville, California, after learning a child had been playing on a pile of "yellowish colored powder" near the store's garden department.

The accord calls for Wal-Mart to pay a $20 million fine, $3 million to improve store maintenance, $3 million for other environmental projects, and $1.6 million for legal costs.

Bonnie Dumanis, the San Diego County district attorney, called the settlement one of the largest of its kind in the United States. Nineteen other prosecutors, including California State Attorney General Jerry Brown, and 32 environmental health agencies joined the accord.

Phyllis Harris, Wal-Mart's vice president of environmental compliance, said in a statement the retailer has worked closely with California on a comprehensive hazardous waste plan that includes improved training programs, policies and procedures.

Spokesman David Tovar said Wal-Mart is working to resolve a separate federal probe that raises similar allegations.

Wal-Mart said the settlement will not affect its fiscal first-quarter operating results.

The $27.6 million represents about two-tenths of one percent of the Bentonville, Arkansas-based retailer's $14.41 billion of profit from continuing operations last year.

Wal-Mart shares rose 20 cents to $53.85 in afternoon trading on the New York Stock Exchange.

The case is California v. Wal-Mart Stores Inc, Superior Court of California, San Diego County, No. 37-2010-00089145.

(Reporting by Jonathan Stempel and Brad Dorfman; editing by Leslie Gevirtz and Andre Grenon)

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