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Chinese Drywall Pilot Remediation Program Detailed

Oct 15, 2010 | Parker Waichman LLP
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More details have emerged regarding the Chinese drywall settlement that was announced yesterday. The settlement, which involves Knauf Plasterboard Tianjin Co., sets up a pilot program in which Knauf and other named defendants will pay to remediate 300 homes in Florida, Mississippi, Alabama and Louisiana.

If the Chinese drywall remediation program is successful, it could pave the way for a global settlement of many of the Chinese drywall claims now pending in the massive litigation underway in New Orleans. Thousands of homes could ultimately be eligible for the program.

The agreement calls for Knauf and other defendants to see that the defective drywall is removed, and replacements made for electrical wiring, appliances including air conditioning, and fixtures damaged by drywall fumes, in accordance with the remediation protocol established by the Consumer Products Safety Commission. The protocol also requires that other fixtures be removed and replaced as needed, including: Hot water heaters, cabinets, countertops, doors, moldings and trim (as required to remove drywall), sinks, toilets, bathtubs and shower enclosures, mirrors, ceiling fans, plumbing fixtures, exhaust grills and diffusers, marble pieces, doors and attached door handles.

Knauf will hire the contractors to perform the work, and repairs will be inspected by an environmental engineer.

One of the first homes to be remediated under the agreement is a vacation rental home belonging to Scott Barry of New Jersey. The home is located in Cape Coral, Florida. Barry is represented by the Bonita Springs law firm of Parker Waichman LLP, one of the first firms to file a Chinese drywall lawsuit in Florida.

After hearing of the settlement, Barry told WinkNews.com that: “It’s a sick house. The house is actually eating itself away. It has a cancer, it’s eating all the metals away, the wiring, I’m sure the metal studs are eating themselves away.”

Attorney April Goodwin of Parker Waichman LLP told WinkNews.com that the first repairs are scheduled to begin next week. In addition to paying for repairs, homeowners will receive $8.50 per square foot to cover any additional expenses such as moving costs and temporary housing, Goodwin said. Goodwin added that her firm is still accepting Chinese drywall cases, and interested homeowners can contact Parker Waichman at www.yourlawyer.com to arrange a free case evaluation.

For now, only homes that are proven to contain 95 percent Knauf-made drywall will be eligible for the remediation program. Plaintiff-approved inspectors will soon begin visiting homes to take pictures to prove to Knauf that homeowners belong in the pilot program.

According to a report on Nola.com, participating in the program releases Knauf and its partners from all claims except for bodily injury, which have not come up for test trial yet. Attorney fees will be negotiated at a later date, and will be paid by Knauf. The company admits no liability.

One plaintiffs’ attorney told Nola.com that the average home in the program is about 2,500 square feet, making the average repair price $150,000. If Knauf and its partners took on 3,000 homes at a price of $60 per square foot, repairs alone could cost $450 million.

It’s also important to note that the settlement won’t resolve every Chinese drywall lawsuit in the litigation. Though Knauf imported a large majority of Chinese drywall to the US, several other Chinese manufacturers also have been named in tainted drywall lawsuits. It is hoped that the Knauf settlement will encourage those manufacturers to consider similar agreements.

In addition, homes that have already been repaired, as well as those in foreclosure or bank-owned still have to be dealt with.

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