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More investigations for Office Depot…

Yesterday, Office Depot (ODP), like a growing number of retailers, announced disappointing results for the 4th quarter and the stock, already trading below $2 a share, is continuing to fall.

While there was certainly plenty of negative news in the release, it was a new disclosure in the 10K also filed yesterday that caught my attention: the company is being investigated by three separate federal agencies. Here’s a snippet from the K:

We are also cooperating with the U.S. Department of Defense (“DOD”), the Department of Education, and the General Services Administration (“GSA”) with respect to their joint investigations that are being conducted in coordination with the Department of Justice regarding our pricing practices that relate to sales to certain federal agencies. We first became aware of the GSA matter on December 29, 2008, the DOD matter on January 20, 2009 and the Department of Education matter on February 19, 2009. No claim for relief has been made in any of these matters and management cannot predict their ultimate outcome.

Now I didn’t listen to the conference call yesterday, but a quick skim of the transcript shows that this never even came up during the call, which seems kind of odd, given the number of investigations and the involvement of the Department of Justice. Keep in mind that the company is already being investigated by several states for what sounds like related issues of overcharging government agencies, something that is also disclosed in the K. Which kind of makes you wonder: were the analysts not aware of what was in the K?