NEW ORLEANS -- A Chinese drywall manufacturer has agreed to pay hundreds of millions of dollars to resolve court claims by thousands of Gulf Coast property owners who say the product corroded pipes and wires and otherwise wrecked their homes, the largest settlement of its kind so far.
The deal announced Thursday by U.S. District Judge Eldon Fallon calls for Knauf Plasterboard Tianjin Co. to create an uncapped fund to pay for repairing roughly 4,500 properties, mostly in Florida, Louisiana, Mississippi and Alabama. A separate fund capped at $30 million will pay for other types of losses, including those by people who blame drywall for health problems.
Russ Herman, a lead attorney for the plaintiffs, said the settlement is worth between $800 million and $1 billion, although an attorney for the Chinese company disputed that estimate.
Chinese drywall was used in the construction of thousands of homes, mainly in the South, after a series of destructive hurricanes in 2005 and before the housing bubble burst. The problems it has caused range from a foul odour to corrosion of pipes and wiring.
Steven Roberts, a plaintiff who built a home in Boynton Beach, Fla., said the first sign of trouble was a foul odour that smelled like "bitter sulfur." His family didn't suspect a more serious problem until electrical appliances started failing and corrosion formed on mirrors and bathroom fixtures.
-- The Associated Press
