By Rebecca Mowbray, The Times-Picayune
Saints coach Sean Payton is the lead plaintiff in a 591-page class action lawsuit against Knauf Plasterboard Tainjin Co. Ltd., a Chinese company that manufactured drywall that is believed to be corroding homes and making people sick.
The suit, filed Wednesday in U.S. District Court in New Orleans on behalf of people with this particular brand of drywall, attempts to give some scope to the problem of defective drywall as both plaintiffs and defendants figure out how many people are affected and much it will cost to repair damage.
About 2,100 people signed up to be a part of the suit by last week’s deadline. Another 600 people were too late to get involved, but Russ Herman, lead plaintiff counsel in the national litigation, said he plans to roll all of the late fliers into another complaint and file it overseas.
Attorney Daniel Becnel Jr. said Payton was selected as the lead plaintiff because he was among the first people in Louisiana to link news reports about bad drywall to televisions, computers and electrical equipment failing in his Mandeville home and his family becoming ill.
“It really upset him a lot because this was all going on while he was trying to prepare for training camp,” Becnel said.
With more resources to get to the root of the problem than many other people who have problem drywall in their homes, Payton and his family moved out of their house, then systematically took it apart. They took photos of the evidence along the way, then stored the damaged components in a warehouse, where KPT, the manufacturer, was able to inspect it.
This fall, KPT created a one-time offer for people with its particular brand of drywall to join a class action filed in the U.S. rather than making the homeowners file suit under the rules of international litigation in The Hague because the company wanted to get a handle on the size of the problem it was facing.
With the filing of the suit, Kerry Miller, the attorney for KPT and the lead defense counsel in the national litigation, said his company learned that its problem is limited to Louisiana, Mississippi, Alabama and Florida, since its drywall was imported only to ports in Louisiana and Florida.
“The good news is the alleged problematic Chinese drywall issue is not as large thought,” Miller said of the 2,100 homes. “What my client is concerned about is, how many homes in have our drywall?”
There are multiple manufacturers of drywall is that is believed to be causing problems in people’s homes in 32 states. Estimates have ranged as high as 40,000 households affected nationwide and 3,000 to 7,000 in Louisiana. so far, about 2,500 people have registered with the U.S. Consumer Product Safety Commission to say they have a problem.
Miller said he doesn’t believe those numbers will bear out, but choosing Sean Payton as the lead plaintiff will help his opponents get the word out on the suit and give them the best chance to get people involved. “Anytime he’s on T.V., people pay attention,” Miller said.
The consolidated national litigation over Chinese drywall is taking place in New Orleans, and a series of test cases will begin early next year to sift through the questions and help attorneys assign values to the damage. Test cases enable the lawyers in the case to get clarity on issues in the litgation without having to go to a full trial of all 2,100 situations. The information could later be used to guide where the litigation goes next or settle big numbers of cases.
In January, proceedings in a set of cases from Virginia with drywall manufactured by a Chinese company called Taishan Gyspum, which was found in default by Judge Eldon Fallon in New Orleans because the company failed to show up for the proceedings, will begin.
Herman said that if plaintiffs are successful at getting a verdict against Taishan Gypsum, they will seize ships carrying the company’s product and sell them to raise money to pay the judgment and stop imports of the company’s products into the United States. “They will never be able to ship their products in to the U.S.,” Herman said.
In March, the first test case against KPT from the Sean Payton class action will begin. The plaintiffs are Lakeview residents John and Diane E. Hernandez, who rebuilt their flooded home after Hurricane Katrina only to find that it was filled with bad drywall.
The complaint filed Wednesday also includes tons of Louisiana homebuilders, remodelers, building suppliers and distributors because the plaintiffs allege that businesses should have figured out along the way that the drywall was bad. Herman said there are a disproportionate number of Louisiana companies in the proceedings because the state has many small companies.
David Loeb, an attorney for the Homebuilders Association of Greater New Orleans, said they’re not happy about so many local companies getting rolled into the suit, but there’s not much they can do. “It is not a surprise. We knew it was coming,” Loeb said.
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