Auto parts retail Pep Boys — Manny, Moe & Jack will pay $5 million in civil penalties over claims it violated the Clean Air Act, the Justice Department said Monday.
The Justice Department had alleged that Pep Boys, along with motorcycle maker Baja Inc., had imported and sold at least 241,000 motorcycles, recreational vehicles and generators manufactured in China that were not in compliance with environmental requirements.
The department's agreement with Pep Boys requires the Philadelphia-based company to export or destroy more than 1,300 vehicles and engines and take measures to mitigate the environmental impact of the equipment already sold.
Pep Boys said in a statement it will begin a lawn mower exchange program in which it will offer discounts on push and electric mowers in exchange for customers' gas powered mowers.
"Unfortunately, in this circumstance we relied upon our vendors to ensure that their products were compliant," General Counsel Brian Zuckerman said in a statement. "We now take it upon ourselves to ensure that all of our small-engine merchandise fully complies with the Clean Air Act."
The Justice Department called the case the largest-ever vehicle and engine importation case brought by the U.S. under the Clean Air Act.
Shares of Pep Boys rose 70 cents, or 6.4 percent, to close at $11.70 amid a broader market rally.