Many Watching Outcome of First Chinese Drywall Trial

First Trial For Drywall

The first product liability trial over Chinese drywall is underway in a New Orleans federal court.

Tatum and Charlene Hernandez say that the drywall in their New Orleans home is “unsafe, defective, and inherently dangerous.” They want to be reimbursed for the damage to their property and have the drywall replaced in their home.

This first case will be closely watched by thousands of other homeowners, home builders, the insurance industry, and product liability attorneys.

More than 2,000 cases have been consolidated for the purpose of litigation.

They name Knauf Plasterboard Tianjin Co. Ltd. - maker of the defective drywall that emits sulfuric gases that corrode electronics, have lowered property values, caused health problems and forced people from their homes.

EPA Tests Confirm

The rotten-egg smell was confirmed last year by Environmental Protection Agency (EPA) tests which confirmed it contains sulfur not found in U.S. drywall, as well as the metallic element, strontium, at ten times the level of domestic drywall. The EPA tests also found two compounds generally found in acrylic paint.

Many of the homes built with drywall from China are in Florida and Louisiana and were constructed during the housing boom from 2004 to 2007. Estimates are up to 100,000 homes from 37 states may have been constructed with the noxious wallboard.

An expert witness is already being challenged.

Lawyers for Knauf argue that the plaintiffs hired an unlicensed appraiser who estimated the value of the Hernandez home had dropped by as much as 40 percent.

Knauf also argues that the homes could be fixed by installing an air-filtration system. The federal judge rejected that argument.

So far, there is no official agreement on what will permanently cure a home of the noxious wallboard. Plaintiff attorneys argue that taking the homes down to the studs and rebuilding is the only remediation that will work.

Bench Trial

While this first trial, a bench trial without a jury, will focus on property damage, future trials will focus on the liability of insurance companies and personal injury damages. Tens of thousands of frustrated homeowners have received little or no help from their builders.

The decision by U.S. District Judge Eldon Fallon is expected to have a huge impact on later cases that could amount to up to $10 billion in insurance claims, as estimated by National Underwriters, reports the Bradenton Herald.

Meanwhile, the Sarasota Herald Tribune reports that the Federal Emergency Management Agency has denied a request by Gov. Charlie Crist to provide financial assistance to Florida families. In a letter FEMA referred him to the Consumer Product Safety Commission as the lead agency overseeing the Chinese drywall problem. #