CALHOUN, Ga., Jan. 16, 2023 (GLOBE NEWSWIRE) — Mohawk Industries, Inc. MIC, the world’s largest flooring manufacturer, announced today that it has reached an agreement with plaintiffs to resolve the previously announced securities-related class action lawsuit. Mohawk and certain of its officers have been named as defendants in this lawsuit, which was originally filed in the U.S. District Court for the Northern District of Georgia on January 3, 2020 (the “Securities Class Action”). Mohawk believes that this securities class action is without merit and that it has substantive defenses against the liability and damages claims; However, Mohawk has concluded that further litigation would be lengthy, burdensome and expensive. In exchange for the dismissal and a full waiver of claims against the defendants, the parties have agreed to settle the securities class action for $60 million, a substantial portion of which is covered by insurance. The settlement of the securities class action is expected to be submitted to the court for preliminary approval. The resolution of this case is subject to customary and customary final documentation, public disclosure and court approval.

Mohawk has also successfully resolved a previously disclosed dispute with the Belgian Tax Authority (“BTA”) regarding the tax treatment of intellectual property royalties. In April 2022, the BTA issued a tax assessment of approximately EUR 187 million (including penalties but excluding interest) for the calendar years ending December 2013 to 2018. Although Mohawk believes its tax position in Belgium is correct, Mohawk reached an agreement with the BTA on November 23, 2022 to resolve the dispute for a one-time payment of €3 million.

Since Mohawk published its third-quarter results on Oct. 27, 2022, the US Federal Reserve has announced two more rate hikes. Those increases, combined with persistently high inflation and lagging consumers…