NEW ORLEANS (AP) — A federal judge on Thursday approved five class-action settlements that call for a Chinese drywall manufacturer and others to pay hundreds of millions of dollars to repair homes damaged by the product, attorneys for thousands of Gulf Coast property owners said.
U.S. District Judge Eldon Fallon in New Orleans held a hearing in November to help him gauge the fairness of five separate but related settlement agreements between plaintiffs' lawyers and companies that made, supplied or installed the defective Chinese drywall.
The product was used in the construction of 12,000 to 20,000 homes and businesses, 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 odor to corrosion of pipes and wiring.
Fallon's order certified settlements for Interior/Exterior Building Supply, LP; Banner; L&W Supply Corp.; Knauf and Global participating builders, suppliers and installers.
After Fallon's ruling, plaintiffs' attorney Arnold Levin said he was "thrilled that the court has issued an order and is hopeful that homeowners will now be able to get their homes remediated and put their lives back together."
Levin said the settlements will benefit more than 10,000 property owners and are estimated to be in excess of $1 billion, most of which will be paid by Knauf Plasterboard Tianjin Co.
Knauf agreed to create an uncapped fund to pay for repairing roughly 5,200 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.
Attorneys' fees and costs paid by Knauf are capped at $160 million and will not be deducted from homeowners' shares of the settlement money.
A total of about 300 plaintiffs have opted out of the five settlements, according to Levin.
Fallon, who presides over more than 10,000 claims involving Chinese drywall, refused in September to dismiss property owners' claims against a different Chinese drywall maker, Taishan Gypsum Co. Ltd.
Taishan, which argues that U.S. courts don't have jurisdiction over claims against it, appealed Fallon's ruling.