Homeowners Claimed Defective Drywall Ruined Their Home

Counsel Financial

About 2,000 homeowners purchased drywall from a regional supplier that was manufactured by two Chinese companies. The homeowners brought a class action lawsuit against the regional supplier, alleging the drywall was defective because it contained sulfur levels ten times higher than permitted by US government standards. The drywall produced sulfur dioxide gas--a corrosive gas. Plaintiffs' counsel alleged the corrosive gas destroyed air conditioners, electrical systems, household appliances, and created a noxious odor. The regional supplier contended that it could not be liable, as it was the seller and not the manufacturer.

SETTLEMENT: $8 million

Sidebar: According to the settlement terms, the class members may pursue up to $72 million from the defendant's excess insurer. Also, this case is one of dozens of cases involving defective drywall that was manufactured in China. In re: Chinese Drywall Litigation, Case No. 09-8030 (U.S. District Court, Eastern District, New Orleans, LA, Hon. Eldon E. Faloon, May 6, 2011).