Product Liability

Chinese drywall maker to gut and repair 300 Southeastern US homes

Three hundred homeowners in Florida, Louisiana, Alabama, and Mississippi will have their homes gutted of toxic Chinese drywall and repaired, thanks to an agreement reached between lawyers representing the affected families, manufacturer Knauf Plasterboard Tianjin Co., and a number of drywall suppliers, home builders, and insurers.

Tons of Chinese drywall entered the United States after the national construction boom and  Hurricane Katrina’s devastation of New Orleans created a shortage of domestically produced drywall. The corrosive, foul-smelling drywall from northeastern China made its way into thousands of homes of across the country, primarily in the South.

Under the agreement, Knauf and the other companies will foot the bill for gutting the homes and replacing the drywall and all corroded wiring, fire and alarm systems, and fixtures in the affected homes. Repairs of the 300 homes are expected to cost between $30 million and $45 million dollars, or about $40 to $60 per square foot. The cost of providing temporary housing for the displaced families isn’t included in that estimate.

If the pilot program is successful and the agreement satisfies all parties involved, it could be extended to 3,000 additional homes made with the toxic drywall.

U.S. District Judge Eldon Fallon said the agreement was the first step in a global resolution of the toxic Chinese drywall problem. The only problem is that Knauf Tianjin is just one of the companies that manufactured drywall with toxic sulfuric compounds.

The Chinese Drywall Complaint Center (CDCC), a watchdog group monitoring the widespread drywall problem, says the toxic Chinese drywall has been used in varying degrees to build homes in the U.S. since 2001 and that hundreds of thousands of homes throughout the Southeastern U.S. could be affected.

Of the homes known to be affected, 57 percent are in Florida, 19 percent in Louisiana, and 6 percent each in Alabama and Mississippi. Homes in Virginia and other states account for 8 percent of the cases.

Judge Fallon presides over the consolidated claims and has already awarded nearly $3 million to eight families whose homes have been ruined by the corrosive drywall. Those rulings, however, do not include medical claims. The first of the cases involving medical complaints won’t be considered by the court until late 2010 or early 2011.

Studies have found a possible link between throat, nose and lung irritation and high levels of hydrogen sulfide gas emitted from the wallboard, coupled with formaldehyde, which is commonly found in new houses.

The U.S. Consumer Product Safety Commission says that homes tainted by Chinese drywall should be gutted and all electrical wiring, outlets, circuit breakers, fire alarm systems, carbon monoxide alarms, fire sprinklers, gas pipes and drywall removed. The drywall is also known to corrode air conditioning units, computers, doorknobs and other metal fixtures, and jewelry.