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Office Depot's Significant Gains: More to Come

As an industry veteran in office products, I could not disagree more with the writer's assessment of Depot. If he had done his homework he would have realized that OD is currently under investigation for "bait and switch" practices and has already agreed to pay a few hundred thousand dollars to the City of Berkeley in California for over-charges. Many states including California (Refund of 2.4M) Florida, Missouri, and North Carolina have investigated Depot and a few including N.C. and Georgia have either not allowed them to bid again or have stated publicly that they will no longer buy from them. After the City of Berkeley was promised payment school districts and municipalities across the U.S. have initiated their own investigations with the hope of recovering significant amounts of cash. Most of these folks use the same or similar contract to the "US Communities L.A. County Agreement" based in California. The size of this contract in yearly spend is somewhere between 500M and 700M dollars. If "errors" have been occurring for years within this contract (which they have) I would not bet a dime on Depot's future and Jared Schneider's recommendation like so many from the analyst community could end up costing investors millions.