Parker Waichman LLP Injury Alerts
Already an Economic Disaster, Chinese Drywall Now Suspected of Causing Significant Health Problems for Unlucky Homeowners and Their FamiliesNov 1, 2009
Already an Economic Disaster, Chinese Drywall Now Suspected of Causing Significant Health Problems for Unlucky Homeowners and Their Families
While the term “Chinese drywall” sounds harmless enough, it is rapidly becoming a severe problem plaguing a staggering number of new homeowners, causing potentially irreparable structural damage as well as possible health risks. Hundreds of thousands of homes built between 2004 and 2007, predominantly in Gulf Coast states (although many other states are involved) may contain defective drywall (gypsum or wallboard) imported from China. This problem has prompted the Consumer Product Safety Commission (CPSC) to initiate an investigation.
A new report released by the CPSC in late November 2009 shows a “strong association” between chemicals in Chinese drywall and the problems in affected homes. The imported Chinese drywall emits high levels of sulfuric gases and strontium, causing an unpleasant “rotten egg” smell that permeates affected homes. These noxious fumes corrode certain metals, causing extensive damage to electrical wiring, home appliances, and lighting and plumbing fixtures. The report is the second in a series of progress reports for the ongoing investigation. Common damages and complaints in affected homes include:
- “Rotten Egg” Smell
- Corrosion and/or Blackening of Metal Items, including Jewelry, and Lighting and Plumbing Fixtures
- Corrosion and/or Blackening of Copper Wiring
- Failure of Common Appliances including Air Conditioners, Televisions, Refrigerators, Microwaves, Computers
- Faulty or Flickering Lights
- Discoloration of Wood Furniture
While the report refrained from definitively linking the defective drywall to adverse health effects at this stage, the investigators said the drywall is a possible and likely cause of those problems. People residing in affected homes have experienced a number of common symptoms that are associated with over-exposure to these toxic gases. It has also been noted that people experiencing health problems have seen a reduction in their symptoms once they leave their homes for extended periods of time. The investigation on adverse health effects is ongoing. The more significant health problems experienced include:
- Irritated or Itchy Eyes
- Respiratory Problems
- Severe Allergies
- Insomnia / Sleep Apnea (trouble breathing while sleeping)
Origin of the Problem and Extent of Damages:
A spike in housing construction between 2004 and 2006 coupled with a limited supply of U.S. manufactured drywall caused many homebuilders to use drywall imported from China. Chinese drywall has been imported, albeit in much smaller quantities, since around 1999. Importation of large quantities of chemically defective drywall occurred during the middle of this decade in response to the high demand created by escalating construction demands including the massive rebuilding effort following Hurricane Charley in Florida in 2004, and Hurricane Katrina along the Gulf Coast in 2005.
Hundreds of thousands of homes built in the U.S. between 2004 and 2007 contain defective Chinese drywall. The true magnitude of this problem remains unknown, but sources estimate that between 500 and 550 million pounds of defective drywall was imported. The majority of this drywall was imported directly into Florida, and used in rebuilding efforts after Hurricanes Charley and Katrina. As such, the epicenter of affected homes is Florida and Louisiana but the problem is by no means confined to this area. States hardest hit are Alabama, Georgia and Virginia, and complaints from Arizona and California are increasing.
The defective drywall was distributed through a network of construction supply companies and homebuilders throughout the country. A major obstacle facing investigators is that the Chinese manufacturer is not always clearly identified on the drywall.
Although the amount of drywall imported from China from 2004-2007 is relatively small when compared to the amount of drywall produced domestically during this time, the fact that the two are often mixed together makes the problem even more difficult to trace and repair. Even small amounts of the defective Chinese drywall can cause major problems and the damage has extended to at least 30 states, Puerto Rico, and the District of Columbia.
The Homeowners Consumer Center in Washington, D.C., a consumer watchdog group, believes Chinese drywall may have been used in residential construction in all 50 states, mainly focused in Florida, Louisiana and Virginia, and between 200,000 and 300,000 residences could be impacted nationwide.
Who is responsible for damages?
While the CPSC’s report draws a connection between Chinese drywall and the damages sustained to the homes, it has done little to clarify where blame should be placed for this growing disaster. Shadowy Chinese manufacturers, the Chinese government, construction material distributors, homebuilders, sub-contractors, insurers, and the U.S. government are all involved, but ultimate liability for the extensive damages is yet to be determined.
The CPSC is working with Chinese officials, and has stated that Chinese companies “should do what is just and fair,” and accept responsibility for defective products they have exported. Cooperation from the Chinese government would be helpful in resolving some of the issues with respect to manufacturers within China, since it has been extremely difficult to track down the actual companies and individuals responsible for producing the defective drywall.
Drywall is manufactured from gypsum, and the source of the defective gypsum has been traced to at least one mine (possibly several) in China found to contain higher amounts of sulfuric compounds. German drywall manufacturer Knauf Plasterboard Tianjin Co. LTD and its Chinese subsidiaries have been identified as the major exporter of the defective drywall. Knauf and a few other drywall producers received complaints about the tainted mine, which is located in Tianjin, China.
Knauf has attempted to avoid responsibility, however, claiming it stopped using the mine toward the end of 2006, denying that its product is toxic, and arguing that since they are not the only importer of drywall from China, they should not be held fully accountable. Drywall manufacturers implicated in importing defective products to the U.S. include Knauf Gips KG, Knauf Plasterboard Tianjin Co., Taishan Gypsum Co., L&W Supply Corp. and USG Corp.
Lennar Corp., the nation’s second-largest homebuilder by volume, built a significant amount of the Florida homes containing Chinese drywall. According to a report in The Wall Street Journal, Lennar has been cooperating in the investigation, testing dozens of its Florida developments, sharing results with the state health department, and relocating several families in order to rip out and replace the drywall in their homes.
While Lennar has been active in attempting to rectify the problems their homes have caused, that is not the case with some homebuilders. There have been reports of builders in Florida preying on homeowners who have been victims of Chinese drywall with the goal of coercing them into forfeiting all of their legal rights in return for an inadequate remediation of their homes.
Similar reports in Mississippi have prompted lawmakers to contact the Federal Trade Commission to help protect Mississippi consumers from companies and individuals offering questionable solutions for contaminated drywall. Also, as a result of the recent housing market crash, some homebuilders have gone bankrupt since the drywall investigation began, leaving some homeowners unsure of their rights.
Rectifying the catastrophic damages caused by Chinese drywall will be an extremely expensive process. Residents must be moved from their homes for many months, while the entire interior of the house must be gutted and replaced. This does not even take into account the damages to personal property, or the inevitable devaluation of the property. Significantly, many experts believe remedial measures, regardless of their cost or extent, are inadequate, and nothing short of complete demolition and rebuilding will suffice with respect to most of the contaminated homes.
Many homeowners affected by this epidemic are turning to litigation in order to seek some measure of compensation for their losses. The companies being sued are being anything but cooperative, however. Homebuilders, for example, do not believe they should be liable for the defective drywall, which was approved and exported from foreign countries. Insurance companies seek to use legal loopholes and questionable exclusions in their policies to deny coverage. At least three insurers have already canceled or refused to renew policies after homeowners sought their help replacing the defective wallboard. The litigation itself is also a problem since it is extremely complicated and expensive due to the number of potential defendants, the worldwide scope of the distribution chain, and the enormous cost of retaining qualified experts, conducting discovery, and battling corporate giants and their well-funded attorneys.
Only the most qualified and financially sound plaintiffs’ litigation firms will be able to tackle this monumental legal battle.
The first Chinese drywall trial is set to begin in U.S. District Court, Eastern District of Louisiana,
on January 25, 2010 before U.S. District Court Judge Eldon E. Fallon. Jerrold Parker, Managing Partner of Parker Waichman LLP, has already been named to the Plaintiffs' Steering Committee (PSC) in the Chinese-Manufactured Drywall Products Liability Litigation (MDL NO. 2047) before Judge Fallon.
The trial will involve seven Virginia homeowners whose homes were damaged by tainted drywall produced by Taishan Gypsum Co. Ltd. The seven cases will represent various aspects of the broad scope of damages. The goal is to use the seven cases, which will be heard together in one joint trial, to assess damages and hopefully determine the appropriate remediation that could potentially apply to similar cases across the board.
What To Do If You Are a Victim of Chinese Drywall
If you suspect or know that your home contains defective Chinese drywall, you must take immediate action to protect your rights. If Knauf Plasterboard imported the drywall, you can be included in an omnibus class action lawsuit, which will allow claimants to submit pictures and documentation about their cases.
Since it is probable that health-related injuries will, at some point, become part of the litigation or any future settlement, those living in contaminated homes, especially children, the elderly, or medically impaired, are even more in need of immediate legal guidance and advice.
To be eligible for the class action lawsuit against Knauf Plasterboard, claimants must submit pictures or other proof that they have wallboard made by Knauf Plasterboard in their homes. Any Chinese drywall homeowner interested in becoming a party to this lawsuit must start now by contacting an attorney and arranging to have their home inspected. Although the deadline for Chinese drywall claimants to sign on to this omnibus class action lawsuit was December 2, very often these deadlines are extended by the courts and that could be the case here.
Parker Waichman LLP, the first law firm to file a federal Chinese drywall lawsuit, is offering assistance to any homeowner interested in joining the Knauf Plasterboard lawsuit. Free consultations are available through the firm’s website at www.yourlawyer.com, or by calling 1-800-LAW-INFO (1-800-529-4636).
Parker Waichman LLP is also offering free consultations to any homeowner who was coerced by a builder to enter into a one-sided, unfair remediation agreement. If you or someone you know has been victimized by a builder in this way, we urge you to contact us immediately to protect your legal rights.