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Chinese Drywall Litigation Set to Go into High Gear

Jan 8, 2010 | Parker Waichman LLP

This will be a big month for the  Chinese drywall litigation currently underway in federal court in Louisiana.  The first bellwether trials in the litigation are scheduled to start in just a couple of weeks. 

The Consumer Products Safety Commission (CPSC) has received more than 2,700 complaints from dozens of states regarding defective Chinese drywall.Gases emitted from Chinese drywall are being blamed for significant property damage, including damage to HVAC systems, smoke detectors, electrical wiring, metal plumbing components, and other household appliances. These gases also produce a sulfurous odor that permeates homes, and cause metals, including air conditioning coils and even jewelry, to corrode. People living with Chinese drywall have also suffered eye, respiratory and sinus problems that may be linked to the gases.

The first Chinese drywall trial will involve a case from Virginia,  Taishan Gyspum, which is actually controlled by the Chinese government. As we reported last year, Taishan has already been issued a preliminary default judgment for failing to respond to lawsuits. If homeowners are successful in their case against Taishan, its ships and cargo could be seized and sold until the judgment is satisfied. The company would also be prevented from importing products to the U.S. until the matter is resolved.

At least 3,000 people from around the country have filed suit over defective Chinese drywall.  All of the Chinese drywall lawsuits filed in federal courts have been consolidated in the US District Court in New Orleans under Judge Eldon E. Fallon as part of a multidistrict litigation (MDL). One single class action lawsuit alone filed against Knauf Gips KG, its Chinese affiliate, Knauf Plasterboard Tianjin Co. Ltd., and 600 other defendants, involves nearly 2100 plaintiffs from Florida, Mississippi and Alabama. Sean Payton, head coach of the New Orleans Saints football team, is listed as lead plaintiff on the Knauf lawsuit. Payton and his family were forced from their Mandeville, Louisiana home over summer because of defective Chinese drywall.

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