West Memphis, Arkansas – Arkansas Attorney General Tim Griffin announced a major settlement with Family Dollar and Dollar Tree entities tied to a rat-infested distribution center in West Memphis that federal investigators said operated under unsanitary conditions for years while shipping products to stores across multiple states.
According to Griffin, Arkansas negotiated a $5.5 million settlement resolving the state’s consumer protection lawsuit against the company. Of that amount, the state is expected to receive $3.9 million, while an additional $1.6 million has been suspended as part of the agreement.
The lawsuit was originally filed in April 2022 after disturbing evidence surfaced involving severe rodent infestations inside the Family Dollar distribution facility in West Memphis.
“Arkansas has negotiated a $5.5 million settlement with Family Dollar and Dollar Tree entities, and will receive $3.9 million, with $1.6 million suspended,” Griffin said. “The settlement brings to a close a lawsuit that was filed by the Office of the Attorney General in April 2022 after evidence came to light that Family Dollar knowingly operated a distribution center in West Memphis that was infested with thousands of rats.”
FDA Investigation Revealed Widespread Infestation
The controversy exploded after a video showing rodents inside the warehouse circulated publicly in 2022, prompting an investigation by the U.S. Food and Drug Administration.
According to Griffin, the FDA discovered the facility had experienced ongoing rodent problems dating back at least to 2020. Investigators reported that more than 3,400 rodents were removed from the distribution center between March 2021 and January 2022.
Products from the warehouse were distributed to all 85 Family Dollar stores operating in Arkansas, along with locations in five additional states during that time period.
“In 2022, the U.S. Food and Drug Administration conducted an investigation into a Family Dollar distribution center in West Memphis after a video circulated publicly showing the warehouse overrun with rodents,” Griffin said. “The FDA determined that the facility had experienced a rodent infestation since at least 2020 and that more than 3,400 rodents were removed from the distribution center between March 2021 and January 2022.”
Federal authorities later issued a public safety alert and oversaw a large-scale recall involving FDA-regulated products connected to the warehouse.
The Arkansas Attorney General’s Office accused Family Dollar of violating multiple provisions of the Arkansas Deceptive Trade Practices Act. The lawsuit also included allegations involving negligence, strict liability, unjust enrichment, failure to warn consumers, and violations tied to implied warranties of merchantability and consumption.
State officials argued that products stored under unsafe and unsanitary conditions were still distributed and sold to consumers without adequate warnings about the risks.
Federal Criminal Case Added Pressure
The settlement follows major federal action against the company in 2024. Griffin noted that Family Dollar Stores LLC entered a guilty plea in a criminal case handled by the U.S. Attorney for the Eastern District of Arkansas over the infestation.
As part of that federal plea agreement, the company agreed to pay more than $41 million in fines and forfeitures.
Griffin explained that Arkansas agreed to suspend $1.6 million from the state settlement because of the company’s cooperation with the Department of Justice during the federal investigation.
“In 2024, the U.S. Attorney for the Eastern District of Arkansas accepted a guilty plea from Family Dollar Stores, LLC in a federal criminal case related to the rat infestation,” Griffin said. “Part of the plea agreement was a fine and forfeiture of more than $41 million. Because of Family Dollar’s cooperation with the Department of Justice, we are suspending $1.6 million of the negotiated $5.5 million settlement.”
The attorney general also praised members of his Consumer Protection Division for their work on the case and stressed that Arkansas consumers deserve safe products and honest business practices.
“I am grateful to members of my Consumer Protection Division for their work on this case,” Griffin said. “Their dedication and careful enforcement of Arkansas law led to a resolution that ensures meaningful accountability for conduct that put thousands of people at risk. Arkansans—particularly those who rely on neighborhood discount stores for everyday essentials—are entitled to products that are safe, lawfully sold, and honestly marketed. My office will continue to enforce our consumer protection laws to safeguard public health.”
