Article Image
Office Depot Lawsuit Enters Voluntary Mediation Phase

Monday, June, 16, 2014

Office Depot, the large American-based office supplies company, announced as part of their recent Securities Exchange Commission (SEC) filing that a 5-year old lawsuit concerning their government contracts with the State of California would be entering “voluntary mediation” to seek an out-of-court settlement.


The ailing company, which has seen poor profit performance for the last two years, was sued in 2009 by a former employee who claimed he was terminated when he noticed the company was overcharging city and state governments that had supplies contracts with Office Depot and brought the information to the attention of his supervisors.  In light of these accusations, the State of California joined the lawsuit as well.  The employee has since passed away, but his estate continues to pursue the case.


Office Depot denies the allegations and describes the former employee as “disgruntled.”  As part of a company-wide reorganization, however, the new CEO of the company has promised to revise their policies concerning government contracts – which make up a significant portion of Office Depot’s revenues – with a goal of increased transparency and reduced ambiguity of terms.


California is one of several states in the U.S. accusing Office Depot of overcharging.  Florida, Texas New York and Missouri have also filed suit, and Office Depot has settled with New York and Florida with cash payments and no admittance of any wrongdoing.  If a settlement cannot be reached, the suit is scheduled to make its way into California Superior Court in July 2015.