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Argos to file 13m lawsuit against supplier

Insurers to Argos have launched a legal action against a leather technology supplier in a bid to recover millions of pounds after the retailer was found to have sold toxic sofas to consumers.

Leather Trade House, a Northampton-based company, is the subject of a £13m lawsuit filed under Argos's name in the High Court.

News of the lawsuit comes just months after Argos, Homebase and other furniture suppliers were found to have supplied thousands of customers with toxic sofas.
The customers, who suffered burns and other injuries, are set to receive up to £20m in what is believed to be the largest consumer group litigation in UK legal history.

The sofas contained a fungicide, dimethyl fumarate (DMF), to stop them from going mouldy during shipping from China to the UK.

The latest lawsuit claims that Leather Trade House, a leading leather technology supplier to Argos, failed in its duty to properly investigate the effects of DMF.

The action claims that as part of its contract, Leather Trade House was bound to indemnify Argos against any losses suffered as a result of the technology company's negligence.

The Argos insurers claim that one of Leather Trade House's analysts failed to carry out proper checks on DMF and advised that it was safe to use as an anti-mould agent and was low in toxicity.

The legal action points to 4,475 claims related to DMF, of which 1,840 relate to Argos.

Leather Trade House did not return calls and Argos declined to comment. Any successful action would have no effect on the balance sheet of Home Retail Group, Argos's parent company.

Late in 2007 reports starting emerging that a number of people who had bought new sofas across the UK were starting to complain of skin irritations. DMF was blamed for the series of violent reactions in babies, adults and even household pets.

Source : Jonathan Sibun - Telegraph.co.uk

19 July 2010
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