Class Action Lawsuit Over Chinese Drywall Filed For 2,100 People

About 2,100 people joined in a class action lawsuit for Chinese drywall homeowners filed in Louisiana, alleging that their homes were built with toxic wallboard manufactured by Knauf Plasterboard Tainjin Co. Ltd. (KPT).

The drywall lawsuit was filed Wednesday in the U.S. District Court for the Eastern District of Louisiana in New Orleans. The complaint was filed as part of an agreement where the Chinese company agreed to temporarily waive its rights to have lawsuits served through the Hague Convention for plaintiffs who joined the omnibus class action suit against the company by December 9.

Foreign companies have the right to be served legal services through the Hague Conventions, which includes translation into the company’s native language and serving papers to the company in its home country. The process is slow and expensive, costing about $15,000, and has hindered many plaintiffs from listing Knauf Plasterboard as a defendant in Chinese drywall litigation.

Knauf Plasterboard is a Chinese subsidiary of a German company that allegedly imported much of the contaminated drywall into the United States between 2004 and 2006. The drywall was imported during a domestic shortage caused by a housing boom and construction following a series of hurricanes in the United States. The U.S. Consumer Product Safety Commission (CPSC) has received complaints about problems with Chinese drywall from homeowners in at least 30 states.

Knauf Plasterboard only waived its right to effectuate service through the Hague Convention for participants in the omnibus class action lawsuit, which they indicate will not be amended to add other litigants in the future. In November, the December deadline was set for plaintiffs who provided proof that their homes contain Knauf drywall. Proof of the defective drywall was established through use of photographs, samples, visual inspections or reports identifying Knauf markings on drywall.

Many of the participants in the class action lawsuit were New Orleans residents who rebuilt their homes after Hurricane Katrina devastated the city, only to discover that the drywall they used was corrosive and gave off a sulfurous smell. The lead plaintiff in the Chinese drywall class action suit is Sean Payton, the headcoach of the New Orleans Saints football team.

The class action complaint is just one of a number of lawsuits over Chinese drywall filed against manufacturers, importers and builders who used the materials. All of the Chinese drywall lawsuits filed in federal courts have been consolidated in the U.S. District Court in New Orleans under Judge Eldon Fallon as part of a multidistrict litigation (MDL).

Proceedings on the first lawsuit are scheduled to begin in January in a lawsuit against Taishan Gypsum, a Chinese drywall manufacturer. Representatives of the company have failed to appear for proceedings, and Judge Fallon has found the company in default.

If the lawsuit against the company is successful, it will effectively end their ability to import to the U.S. until they have paid the judgment against them. Their ships and cargo will be seized and sold until they pay, or until the value of the judgment has been reached.