TJX Settles Customer Class-Action Suits
Boston, The TJX Cos., Inc. said Friday it settled customer class-action lawsuits in the United States, Canada and Puerto Rico stemming from a massive security breach of customer data that affected at least 45 million credit and debit cards.
The announcement did not specify the settlement cost, but noted that its estimated costs were included in a $107 million reserve included in its second-quarter report for fiscal 2008 and its estimate of $21 million in costs expected in fiscal 2009. The $107 million figure includes costs from other lawsuits not included in the customer class actions, the company said.
TJX said it denied the allegations in the customer lawsuits. It concluded that more legal action would be time-consuming and expensive, the report said.
The company said it would offer vouchers to customers who show they shopped TJX stores, except Bob’s Stores, in the United States, Canada or Puerto Rico during the period affected by the breach and incurred certain costs related to the breach.
The company said it will also hold a one-time, three-day customer appreciation event reducing prices 15%, expected sometime next year, the report said.
On Jan. 17, TJX disclosed a breach of its computer systems by an unknown hacker or hackers who accessed card data from transactions as long ago as 2003. On March 28, TJX said at least 45.7 million of its shoppers’ cards had been compromised.
Independent organizations that track data thefts said the case is believed to be the largest in the United States based on the number of customer records compromised.
Home Depot ceo: No job cuts or store closings
ATLANTA Home Depot Inc. will not be making any job cuts or close any of its core retail stores despite the housing decline, the company’s ceo told the Associated Press in an interview.
“We’re making investments, notwithstanding the downturn,” ceo Frank Blake said. “I think that’s absolutely the right thing to do for the business. It’s going to lead to long-term success.”
Home Depot had announced earlier this week that it was closing its 11 Landscape Supply stores (and previously shut down a number of its Expo design centers), but Blake said there are no plans to close any of the company’s more than 2,000 main retail stores.
“We’re not going to shut stores to save costs,” Blake said. “We don’t need to.”
The United States has experienced what has been called the worst housing decline in 40 years, since mortgage rates have increased at a rapid pace, and many seemingly cheap homes have gone unsold.
The company reported second quarter 2007consolidated net earnings of $1.6 billion, or 81 cents per diluted share, compared with $1.9 billion, or 90 cents per diluted share, in the same period in fiscal 2006. Sales for the second quarter totaled $22.2 billion, a 1.8% decrease from the second quarter of fiscal 2006, reflecting negative comparable-store sales of 5.2%.
During midday trading, Home Depot stocks were selling at $34.90 per share.
Home and apparel gets revisited at Wal-Mart
NEW YORK Wal-Mart Stores is working to further develop their categories of home furnishings and clothing, their cfo said at a press conference Tuesday.
Although Wal-Mart cfo Thomas Schoewe said the retailer is in “very good shape” now when it comes to its apparel and home inventory, he also stated that the company is “still struggling with negative traffic in these categories and have lots of room for improvement.”
Since its original attempts to transform its home area did not achieve the expected results, the cfo said the company is experimenting with a different home section layout in one of its New Jersey stores.
Last year, the company’s push to enhance their image with high-end electronics and stylish clothes ended up a bust, as many of Wal-Mart’s low-income customers could not afford to purchase apparel and home goods out of their price range, according to Reuters. Now, Wal-Mart has been working to clear its stores of poor sales by cutting prices.