Chinese Drywall ‘Test Case’ Opens|As 2,100 Other Families Await

     NEW ORLEANS (CN) – A young family’s 1,688-square-foot home was ruined by 180 boards of defective drywall, and “their dream of ownership has really turned into a nightmare,” their attorney said Monday in his opening statement in one of the first major liability trials involving Chinese-made drywall. Knauf Gips and Knauf Plasterboard Tianjin Co. are the lead defendants.




     Plaintiff Charlene Hernandez, a nurse, said she never got bad headaches until she moved into the home in Mandeville. Her children, Grant, 4, and Amelia, 2, constantly battle respiratory ailments, Hernandez told the Times-Picayune.
     Hernandez and her husband, Tatum, of Mandeville, are represented by Chris Seeger in the bench trial before U.S. District Judge Eldon Fallon. The Hernandezes says their insurer denied their homeowners’ claim and the builder hasn’t offered any help.
     “We’re still in the home,” Tatum Hernandez, who works at the U.S. State Department’s passport agency in New Orleans, told the Times-Picayune. “If we moved out, we would still have to pay the mortgage.”
     The trial in the test case began Monday – one of thousands of claims involving Chinese-made drywall. This trial will address property damages. Questions of health issues from the drywall will be handled in a later phase of the litigation.
     The Hernandezes say the Knauf Plasterboard Tianjin drywall installed in their home in 2006 emitted chemicals that corroded wiring, plumbing and heating equipment, caused respiratory and other health problems, and created “noxious, rotten egg-like odors.”
     They say Knauf made the drywall in China from waste material from scrubbers in coal-fired power plants.
     The trial is part of coordinated multidistrict litigation over the Chinese drywall. It is intended as a test to help determine property damage issues in other cases against manufacturers. More than 2,100 people in the United States have filed federal complaints claiming damages from drywall made in China.
     According to court filings, many Chinese drywall defendants haven’t responded, can’t be located or remain unknown. Some drywall is identified only by the words, “Made in China.”
     “We are the only manufacturer that branded our product and were at the center of the controversy for many months while others sat on the sideline,” Donald Hayden, a lawyer for Knauf Gips, said in his opening statement.
     Another test case involving several Virginia families took place last month, but the manufacturer, Taishan Gypsum Co. Ltd., ignored the proceedings. Another manufacturer that had planned to defend the case because it had similar interests withdrew just before the trial started.
     Since that case, the Germano case, went forward with only one side arguing, it is expected to be of little value to the consolidated litigation.
     That leaves the Hernandez family to stand in for the 2,100 others involved in the litigation around the country.
     “This will be the first contested trial,” Steve Herman, an attorney representing the family, told the Times-Picayune.
     While the Hernandez case does not have any direct legal influence on the other cases, a decision on what needs to be done to fix the Hernandez home and how much it will cost could help establish values to will guide settlement discussions in the rest of the cases.
     “Their significance is magnified because there are so many similar cases with common elements,” Herman said. “It’s something that facilitates settlement, because it gives the parties and the court guidance on what the cases are worth.”
     Judge Fallon added, “The issue in this case is the nature and the scope of the remediation and the cost of repairs.”
     Knauf agrees that its drywall was defective, but disagrees with the amount of money the Hernandez family says it needs to repair the damage.
     Steve Herman told Business Week that all parties in the suit agree on the need to remove and replace drywall, moldings, carpets, a granite countertop and electrical switches and outlets. Other claims, such as wiring, appliances and personal property and the cost of repairs are in dispute, Herman said.
     “It is a very significant trial,” said Daniel Becnel, a lawyer in a separate case against Knauf in which New Orleans Saints’ head coach Sean Payton is the plaintiff.
     The Hernandezes’ trial is expected to last two weeks.

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