Legal News

The first settlement in the long running controversy and ensuing lawsuits over Chinese made drywall was reported on May 17. According to the law firm which represents it, Knauf Plasterboard Tianjin Co. has entered into a joint settlement with homebuilding company Beazer Homes USA, Inc. Details of the settlement will be made public later this week.

According to CBS News, Knauf is also in confidential settlement talks with as many as ten other homebuilding companies who used the drywall in their building projects and then had to pay owners for the damage to their homes that resulted.

CBS reports that to date, the CPSC has received 3,296 complaints from homeowners in 37 states plus the District of Columbia, American Samoa, and Puerto Rico who claim to have defective drywall in their homes. The drywall comes not only from Knauf, but was made by a variety of companies. The homeowner complaints claim that the drywall causes corrosion inside the homes affecting everything from the wiring on alarm systems, to plumbing, to appliances. Some homeowners have complained of health problems they say are also related to the defective drywall.

Knauf is facing about 200 federal lawsuits from U.S. homeowners and builders and two judgments have already been entered. In April, federal judge Eldon Fallon awarded a Louisiana couple $164,000 in damages, plus fees and costs, in their suit against Knauf. As discussed in a previous post, Judge Fallon also ruled against another drywall company, Taishan Gypsum Company, awarding over $2 million dollars to several Virginia homeowners.

According to their lawyers, Knauf would like to settle with individual homeowners as well as the builders. However, CBS News writes that the Knauf lawyers say the homeowners are represented by attorneys, making it difficult for Knauf to negotiate with them directly.

Related Resources:

• Update: First Drywall Decision: $2.6 Million to Plaintiffs (FindLaw's Common Law)
• Chinese Drywall Maker Settles First Lawsuit (CBS News)
• Update: CPSC Announces Guidelines for Repairing Homes with Chinese Drywall (FindLaw's Common Law)
• Update: Class Action Suit Filed Against Chinese Drywall Makers (FindLaw's Common Law)
• Press Statement on Corrosion in Homes and Connections to Chinese Drywall (CPSC)