target corp (TGT) Key Developments
U.S. District Court for the Northern District of Ohio Dismisses Certain Claims Arising Out of Target's Sale and Marketing of Brand of Pre-Moistened Wipe Products
Feb 28 15
The U.S. District Court for the Northern District of Ohio dismissed certain claims arising out of Target's sale and marketing of a brand of pre-moistened wipe products, finding that such claims were abrogated by the Ohio Product Liability Act. Remaining claims, except one for negligent misrepresentation, fell outside the purview of the statute and were plausibly pleaded. Meta filed a class action lawsuit against Target Corp. Target moved to dismiss, arguing that Meta's breach of warranty, negligent design, negligent failure to warn, negligent misrepresentation and fraud claims were abrogated by the Ohio Product Liability Act (OPLA). Meta asserted that his claims fell under a narrow exception to abrogation because he was not in privity with the manufacturer and he sought economic damages. According to Meta, his damages consisted of the difference between the value of the wipes advertised and the defective product he received. The district court found that Meta could not carve out a common law product liability claim for economic loss only. The alleged defect in the wipes did not damage the wipes themselves. The alleged injury was the clogging of Meta's septic system. The breach of warranty, negligent design and negligent failure to warn claims were barred by the OPLA. The negligent misrepresentation claim, assuming that it was not a product liability claim, still failed. The district court reasoned that the cause of action is not available in a simple consumer transaction. The district court concluded that common law fraud claim was outside the purview of the OPLA. Meta alleged with the requisite particularity that the defendants knew the wipes were not flushable or safe for septic or sewer systems but made affirmative misrepresentations otherwise. Target argued that dismissal of the defective design and product defect claims was proper because Meta alleged property damage and economic damages while other class members alleged only economic damages. The district court determined that the argument was more appropriately raised on a motion for summary judgment or class certification. The unjust enrichment claim withstood the motion to dismiss. The claim was not duplicative of the fraud claim. The district court noted that the complaint alleged Target was unjustly enriched because it wrongfully profited from the sale of defective wipes. The district court granted in part and denied in part Target's motion to dismiss. Meta could proceed with his fraud, defective design, product defect, breach of implied warranty of merchantability, Magnuson-Moss Warranty Act and unjust enrichment claims.
Target Corp. to Open 50 New Stores in 2015
Feb 25 15
Target Corp. announced that in 2015, of the 50 new stores it is planning to open, more than half of these are new formats with 8 additional Express stores and a new CityTarget set to open in Boston next to Fenway Park.
Target Corp. Announces Unaudited Consolidated Earnings Results for the Fourth Quarter and Full Year Ended January 31, 2015; Provides Earnings Guidance for the First Quarter of Fiscal 2015
Feb 25 15
Target Corp. announced unaudited consolidated earnings results for the fourth quarter and full year ended January 31, 2015. For the quarter, the company reported total revenues of $21,751 million against $20,893 million a year ago period. Earnings from continuing operations before income taxes were $1,434 million against $1,173 million a year ago period. Net earnings from continuing operations were $960 million against $780 million a year ago period. Diluted earnings per share were $1.49 against $1.22 per share a year ago period. Adjusted diluted earnings per share were $1.50 against $1.31 per share a year ago period. EBITDA was $2,148 million against $1,921 million a year ago. EBIT was $1,603 million against $1,413 million a year ago. Net loss was $2,640 million against net earnings of $520 million a year ago.
For the full year, the company reported total revenues of $72,618 million against $71,279 million a year ago period. Earnings from continuing operations before income taxes were $3,653 million against $4,121 million a year ago period. Net earnings from continuing operations were $2,449 million against $2,694 million a year ago period. Diluted earnings per share were $3.83 against $4.20 per share a year ago period. Net loss was $1,636 million against net earnings of $1,971 million a year ago. Cash flow provided by operations was $4,439 million against $6,520 million a year ago period. Expenditures for property and equipment were $1,786 million against $1,886 million a year ago period. Adjusted diluted earnings per share were $4.27 against $4.38 per share a year ago period. EBITDA was $6,890 million against $6,955 million a year ago. EBIT was $4,761 million against $4,959 million a year ago.
In first quarter 2015, the company expects adjusted EPS, reflecting results of operations in its single-segment business, of $0.95 to $1.05, compared with $0.92 in first quarter 2014.
Target Corp. to Lay Off 720 Employees Across its Global Operations
Feb 12 15
Target Corp. is laying off 720 employees across its global operations as the company makes changes linked to its failed roll out in Canada. The company has told 550 workers in Minnesota they will be losing their jobs, with 350 of those cuts effective immediately. Another 170 staff based at its technology centres in India will be 'eliminated over time'.
Target to Pay $3.9 million for Misrepresented Pricing
Feb 11 15
Target agreed to pay $3.9 million to settle a lawsuit alleging that it charged higher prices than advertised, misrepresented the weights of products and failed to ensure that price scanners at checkout stands were accurate. Under the deal, Target admits no liability but is bound by a permanent injunction barring it from making false or misleading statements, charging more than the lowest posted price and selling items in lower quantity than represented. Target also agreed to increase the number and frequency of price-accuracy audits at California stores, train its employees to make sure prices are accurate and hire an outside auditor to make sure weights are accurate in Target-branded products. Berberian spearheaded a similar suit against Safeway that led to a $2.25 million settlement last year. Prosecutors with Berberian's consumer protection unit filed the lawsuit in Marin County Superior Court in conjunction with their counterparts in Contra Costa, Fresno, Santa Cruz and Sonoma counties, as well as the San Diego city attorney s office. The suit also said Target, which has headquarters in Minneapolis, had violated a 2008 injunction requiring the store to ensure that its price scanners at checkout stands were accurate.