$2.6 Million Verdict – Chinese Drywall

By: Seeger Weiss on April 8, 2010

Today a federal judge awarded $2.6 million in damages to seven Virginia families in the first ever ruling on Chinese-manufactured drywall in the nation.

Seeger Weiss Secures Bellwether $2.6 Million Verdict in Chinese Drywall Case

Today a federal judge awarded $2.6 million in damages to seven Virginia families in the first ever ruling on Chinese-manufactured drywall in the nation. This bellwether verdict spells positively for the thousands of families whose homes have been ruined by the toxic import.

Seeger Weiss partner Christopher Seeger served on the Plaintiffs’ Steering Committee for this case, which came before U.S. District Judge Eldon Fallon in the Eastern District of Louisiana this past February. Seeger chairs a second committee of national trial teams pursuing Chinese drywall cases. Fellow Seeger Weiss partner Jeff Grand worked closely with Mr. Seeger throughout the case.

The use of Chinese-manufactured drywall in the construction of residential and commercial properties is a growing problem across the United States. This product is reported to contain high levels of hydrogen sulfides, compounds that when exposed to prolonged heat or humidity, release sulfur gasses resulting in: terrible “rotten egg” odors; corrosion of air conditioning, plumbing, and electrical systems; corrosion of metal surfaces and appliances; and physical injuries including but not limited to respiratory problems, nosebleeds, and headaches. It is believed that contaminated drywall may have first entered the United States as early as 2001.

The housing boom across the country combined with the massive reconstruction efforts in Gulf Coast states including Louisiana, Florida, Alabama, and Mississippi following the devastation of Hurricane Katrina and other large storms created a high demand for drywall over the last several years. This demand peaked in 2005 when the rebuilding efforts caused a massive drywall shortage, a gap filled by Chinese drywall manufacturers who flooded the market with their tainted products. It is estimated that approximately 30,000 homes and commercial properties were either repaired or constructed with the Chinese drywall between 2005 and 2006.

Judge Fallon apportioned damages to seven Virginia families and is expected to rule again on another case involving a New Orleans homeowner whose post-Katrina residence was badly damaged by Chinese drywall. Mr. Seeger is also expected to begin trial in early June on behalf of homeowners in Florida.

“Besides being the first judicial ruling in a Chinese drywall case, Judge Fallon’s decision is especially important because he ordered that homeowners be made completely whole for the extent of damages caused by this shoddy product – including repairs to wiring, heating and air conditioning, floors, closets, kitchen cabinets and other fixtures ruined by the drywall,” he said. He noted that plaintiffs’ homes had to be completely gutted to remove any remaining traces of drywall and to correct widespread corrosion.

In his 108-page ruling, Judge Fallon noted that Chinese drywall has a “significantly higher concentration of strontium and significantly more detectable levels of elemental sulfur” than drywall manufactured in the U.S. He further wrote that the “level of corrosive sulfur gases emitted by Chinese drywall…exceeded the safe level established by recognized standards.”

In addition to manufacturers, lawsuits have been brought against a number of firms associated with the faulty drywall, including developers and homebuilders, along with suppliers and distributors. Cases have been brought in both federal and state courts.

Mr. Seeger noted that the federal Consumer Protection Agency recently issued an interim report on drywall issues that recommended many of the remedies proposed at trial.

This is the fourth major trial win that Seeger Weiss has achieved in the past six weeks. In February, the firm won a $25 million verdict for a Florida man whose severe bowel disease was caused by the use of Roche acne medication Accutane, the largest verdict on record in a growing body of Accutane lawsuits. In March, Seeger Weiss won $11 million for a group of families enduring years of extreme toxic odors produced by a factory hog farm in rural Missouri; the farm is owned by Smithfield Foods. Also last month, Seeger Weiss won a $2.25 million verdict in upstate New York on behalf of survivors of a deadly bus crash in 2005 involving members of a girls’ hockey team from Windsor, Ontario.

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