Shares of Lumber Liquidators (LL) sinking today as the flooring retailer announced that CEO Robert Lynch “unexpectedly” stepped down. Of course, Lumber Liquidators has been battling to save its image after CBS (CBS) News’ “60 Minutes” reported on March 1 that some of its laminated flooring from China contained elevated levels of cancer-causing formaldehyde. Sales plunged after the broadcast, and while the company denies there’s any danger, earlier this month it pulled all Chinese-sourced flooring from its stores. Today Lumber Liquidators said founder Tom Sullivan will be acting CEO.

Yahoo Finance Senior Columnist Michael Santoli thinks it’s pretty easy for investors to decipher what this means for the company.

“Nothing good,” he says. “Which is why the market is having the reaction it is.”

Yahoo Finance’s Aaron Task points out it’s really unusual for a company to call such an executive departure “unexpected.”

“I think they were really caught off guard,” he notes. “Otherwise they’d have a better explanation-- he’s got some family business to attend to, he’s got some personal reasons-- you usually get that boilerplate. So I guess in some ways we can thank Lumber Liquidators for being honest and saying we had no idea this was coming, we’re as surprised as anyone.”

For example, when it was announced last month that CFO Daniel Terrell was leaving, Lumber Liquidators said the company and Terrell “have agreed” that his role would terminate June 1.

However, Santoli believes there might be a good explanation for why Lumber Liquidators used the “unexpected” language with Lynch.

“From the company’s perspective, you want to say it’s unexpected for one reason at least-- you don’t want people to say 'I wonder if he’s going to be personally implicated in any of these investigations, I wonder if there are going to be some sort of legal charges coming out here,'” he explains. “If the company comes out and says we didn’t know what was going on, it meant that the board didn’t get together and say 'he’s got to go for legal reasons' or have to disclose something in an SEC filing.”

The Consumer Product Safety Commission announced in March it is actively investigating Lumber Liquidators over the flooring issue.

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So do today’s developments suggest Lumber Liquidators is finished? Santoli isn’t so sure.

"Financially, yeah, they could survive,” he argues. “It wouldn’t be as good a business if they had to actually buy it (flooring) at a normal price.”

The key will be what those probing the company have to say.