Knauf settles first lawsuit; thousands of homeowners still face drywall woes May 18, 2010

In a pivotal development,  a Chinese manufacturer has settled its first suit – Knauf Plasterboard Tianjin Co. settled just days ago, on Friday.  Read the source article, from CBS, here.

The settlement was reached with a homebuilder in Atlanta, Beazer Homes USA, inc.  The settlement was reportedly first made known from an email sent by the law firm representing Knauf.  The article from CBS states that more information will be released to the public in coming days.

Knauf is facing numerous lawsuits from homeowners that claim the drywall installed within their home is defective.  Allegedly, the drywall causes corrosion, foul odors, and other issues including potentially health-related symptoms.  But Knauf is not the only company that has faced allegations of dealing in defective drywall.  Other businesses have been scrutinized (and will continue to be so), such as importers, exporters, builders, and so on.  The magnitude of the issue, monetarily speaking, is enormous.  The potential devastation to an already thrashed housing market is a scary thought.

Thechinesedrywalllawyer.com has been covering the multidistrict litigation taking place in New Orleans, as well as developments as they have become available.  One of the primary federal agencies addressing the defective drywall issue is the Consumer Product Safety Commission, which has received over 3,000 complaints to date.

Thus far, plaintiffs have been relatively successful in court. Judge Eldon Fallon ruled that Knauf must pay damages just over $160,000 to one family in Louisiana.  In addition, the same court held that seven Virginia homeowners were entitled to a combined total of over $2.6 million.

According to CBS, the email from Knauf lawyer included the statement, “the settlement with Beazer is part of [Knauf's] effort to get this issue behind them and move forward.”  The settlement shows at least some willingness to correct problems, which can provide at least some hope that other Chinese manufacturers will cooperate in future proceedings.