Settlement Reached in Lawsuit Over Defective Chinese Drywall

Settlement Reached in Lawsuit Over Defective Chinese Drywall

Publication Date 06/22/2010
Source: Miami Herald (FL)

Two companies in a class-action case over defective Chinese drywall in Homestead, Fla., houses are willing to pay $6 million to settle the case.

South Kendall Construction and an affiliate, Palm Isles Holdings, will pay $4 million, and Keys Gate Realty will pay $2.6 million to homeowners if the offer is approved in court.

Jason and Melissa Harrell, who bought a two-story house in a Homestead neighborhood built by South Kendall Construction in 2008, sued last year in Miami-Dade Circuit Court after they found imported drywall was the source of the smell in their home and the cause of appliances failing repeatedly. Their case was granted class-action status last month.

“The settlements are fair and reasonable,” said the Harrells’ attorney, Victor Diaz. But the couple and other parties in the class aren’t yet whole. “They do not fully compensate the plaintiffs for their injuries.”

Separately, he will pursue a suit against Banner Supply, which provided the drywall used in the Harrells’ home, drywall manufacturer Knauf Plasterboard Tianjin, importer La Suprema and exporter Rothchilt International.

Last week, a Miami-Dade jury found those parties liable for $2.5 million in damages and expenses for a Coconut Grove couple whose home was ruined by drywall emissions.

Notices to the 152 families eligible to join the Harrells’ class-action suit – residents of Palm Isles, Arbor Park and Augusta Greens – are expected to be mailed Thursday.

The agreement in the Harrells’ case would be the second settlement reached over Chinese drywall recently. At the end of last week, drywall manufacturer Knauf Plasterboard Tianjin settled with two Louisiana homeowners whose cases were set for trial this week in federal court in Louisiana.

Paul and Celeste Clement and John Campbell own property in Louisiana that contain KPT drywall. The settlement calls for KPT to hire a contractor to remove drywall and repair the plaintiffs’ homes in select areas.

The repair costs will be negotiated with the contractor, so the settlement isn’t for a specific amount.

Campbell and the Clements will also get small cash payments for relocation expenses, lost rental income – Campbell’s property is a duplex – and attorneys fees.

“This settlement proves that KPT is willing to stand by its product, work broadly with those impacted by its drywall and settle on reasonable repairs,” KPT attorney Steve Glickstein said.

Diaz said he thinks the settlements represent a new phase in Chinese drywall litigation – which includes thousands of lawsuits from homeowners all over the country.

“I hope other defendants will realize it’s much better to settle than to go in front of a jury,” he said. “As the first jury verdict revealed, the facts really anger people.”

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