Chinese Drywall Manufacturers Liable for Millions in Damages

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Since 2008, Chinese-manufactured drywall has been blamed for severe corrosion and sulfur odors in homes, particularly in warm, humid southern states. Now a federal judge, U.S. District Judge Eldon Fallon, has awarded seven Virginia families a total of $2.6 million in damages caused by drywall from one Chinese manufacturer. In another case, he awarded $164,000 to a single family to cover the costs of remediation. At the same time, remediation guidance issued by the U.S. Consumer Product Safety Commission (CPSC) for homes with Chinese drywall shows that these figures are not unreasonably high, and may in fact match the costs faced by homeowners.

In his decision in the Virginia case, Judge Fallon wrote that Chinese-manufactured drywall contained a “significantly higher concentration of strontium and significantly more detectable levels of elemental sulfur” than that manufactured in the U.S. He also noted that the “level of corrosive sulfur gases emitted by Chinese drywall exceeded the safe level established by recognized standards.”

The judge’s findings are backed up by CPSC, which confirmed the link between the drywall and corrosion in 2009 (see EBN Jan. 2010). In both cases, Judge Fallon decided that drywall manufacturers were responsible not only for the costs of remediating the drywall damage but also the costs of relocating during the remediation process.

The remediation guidance issued by CPSC recommends that homeowners remove all problematic drywall and replace electrical components and wiring, gas service piping, sprinkler systems, and smoke and carbon monoxide alarms. This can be expensive: in one of Judge Fallon’s cases, the family’s remediation costs totaled over $113,000, not including relocation costs. According to David Jaffe, vice president of construction liability and legal research at the National Association of Homebuilders (NAHB), many builders are quoting costs of $100,000 and up for drywall remediation.

According to Jaffe, NAHB is working on its own remediation guidance document for members; he expects the guidance to be available before July 2010. He noted that CPSC is primarily concerned with consumer health and safety, so its guidance focuses on remediation of safety-related items in homes. “There are other aspects of remediation that don’t affect health and safety,” said Jaffe, such salvaging expensive cabinetry while getting to the drywall behind it—a task that requires knowledge and time, both of which can raise costs.

– Allyson Wendt

For more information:

Consumer Product Safety Commission

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May 17, 2010