Class actionable sheetrock

 

2-26-09
The National Law Journal
Something Rotten in Drywall, Say Homeowners
Sulphur emissions suspected from drywall of undetermined origin
Daily Business Review
John Pacenti
http://www.law.com/jsp/nlj/PubArticleNLJ.jsp?id=1202428594677 [1]

George and Brenda Brincku knew they only wanted to use the best products for the third house they built together. She said they learned the hard way by scrimping in the past.

When it came to drywall, they insisted their subcontractors use an American-made product.

But the couple started experiencing unusual problems along with a number of owners whose homes were built in 2005 and 2006 when construction materials were scarce. The coils in their high-end air conditioner failed repeatedly. There was a strong odor in a downstairs bathroom.

"We knew something was wrong,"said Brenda Brincku.

They then read news accounts about houses with similar problems blamed on flawed toxic drywall manufactured in China by Knauff Plasterboard Tianjin and other Asian companies. But the Brinckus' home near Fort Myers didn't have Chinese drywall. Their drywall came from U.S. companies including National Gypsum in Charlotte, N.C.

"Our subcontractor swore he used National Gypsum because that's what we wanted," Brenda Brincku said. Inspectors and tests confirmed the subcontractor wasn't lying, and receipts show the Brinckus purchased American-made wallboard, the couple and their lawyer insist. The couple plan to file a lawsuit in Miami federal court as soon as Friday against National Gypsum and others. A proposed class action also is planned on behalf of other homeowners, naming another manufacturer, Chicago-based USG.

Numerous lawsuits have been filed over drywall, and the Palm Beach Gardens, Fla., law firm of Leopold-Kuvin filed a motion Wednesday with the Federal Multi-District Litigation Panel to consolidate the drywall class action complaints being filed across the country.

The Brinckus are represented by attorney Ervin Gonzalez, a partner with Colson Hicks Eidson in Coral Gables. He also is one of the lead lawyers in a team of attorneys filing the class action, which also names Knauff's Chinese operations and others. Builders will be pursued in arbitration. "Initially, I thought it was a Chinese drywall problem, and we even called it the 'Chinese drywall case,'" Gonzalez said. "But in doing our research and talking to some of the homeowners, we found that American manufacturers were also involved, specifically U.S. Gypsum and National Gypsum. [They] may be responsible for the same wallboard problems that we have seen with Chinese wallboard."

The class action plaintiffs bought homes mostly built in 2006. In some ways, the drywall problem is more fallout from the boom-to-bust housing market in Florida, though Gonzalez is quick to say homeowners in other states including Virginia have been affected and will be part of the class.

Some homeowners discovered their drywall was suspect after smelling a foul odor similar to rotten eggs -- a telltale sign of sulphur -- inside the house. An inspection found copper pipes that were not penny-colored but black, pitted metal fixtures in kitchens and bathrooms and even some corroded mirrors.

"Very strange, and these are relatively new homes," Gonzalez said.

So how did U.S. manufacturers end up allegedly making bad drywall?

Gonzalez suspects the drywall drought pushed U.S. companies to buy wallboard from Chinese manufacturers and relabel it as their own or recycled wallboard to make their own product.

Both National Gypsum and USG denied that happened.

"We have never purchased any Chinese wallboard or relabeled any Chinese wallboard," said Sam Schiffman, general counsel for National Gypsum. "We make all our wallboard in our United States plants."

Schiffman offered another possibility for sulphur emissions.

"It's not uncommon for homes that were built during times when demand was strong and wallboard was hard to get to have different brands of wallboard in the same home," he said. "It's entirely possible homes having a problem with Chinese wallboard may also have some of our product."

USG said it sold some Chinese-made Knauff products through its subsidiary, L&W Supply, but the product was clearly labeled and the amount purchased was miniscule. "The Chinese wallboard that is the source of the complaints represents less than one-half of 1 percent of L&W's total wallboard shipments in Florida in 2006," said USG spokesman Robert Williams, whose company made a name for itself with the Sheetrock brand.

Recycling wallboard material is relatively new and not cost-effective, he said.

"Sheetrock is 100 percent manufactured in North America. Nothing is ever re-branded as Sheetrock," Williams said.

Michael Gardner, executive director of the Gypsum Association in Hyattsville, Md., said using old wallboard to make new products is a tricky process considering each plant is geared to produce a specific stock.

"To my knowledge no one can take a pile of board and make new board," he said. "There is nothing that has indicated the North American product is of questionable nature. It's a Chinese drywall problem."

As for Knauff Plasterboard Tianjin, the company has hired a Florida public relations firm to press its case in the public arena, saying it supplied only 20 percent of all U.S. drywall imports from China from December 2005 to January 2007, and other Chinese manufacturers simply didn't label their products. The Lennar lawsuit names Knauff Tianjin and other Chinese manufacturers such as Taishan Gypsum as defendants. Knauff Tianjin said its medical experts have found no long-term damage and it is looking at a number of options, such as increased ventilation, filtration, cleaning or coating of potentially impacted metal surfaces.

Gonzalez isn't ready to jump to any conclusions.

"We don't know the extent of the health problem," he said. "I'm hoping that it isn't extensive. I'm hoping that it's relatively simple allergy problems, and when you remove the problem it goes away. But we don't know that, and we don't know the long-term effects."

The only real solution for homeowners with sulphur emission from wallboard is a complete renovation, Gonzalez said.

"The cure is very expensive and time-consuming," he said. "You can fix it, but what it requires is the gutting of the entire of the home down to the studs." The attorney said he has found three families with U.S.-made drywall causing problems in their homes, and others say American drywall could be causing similar problems.

Jack Snider, president of the environmental engineering firm AMRC Environmental in Fort Myers, said he has inspected homes exhibiting sulphur emissions and found U.S.-manufactured drywall.

"We have gone in some homes exhibiting the same problem, but we haven't found any drywall that is made in China," he said. "We still need to do further research until we make any conclusions. It may be we just haven't taken enough drywall to find out."

He said one U.S. manufacturer keeps popping up in these homes, but he would not name the company.

George Brincku got confirmation from the Massachusetts Institute of Technology that drywall was causing the problems in his home. He sent a drywall sample, a corroded brass corner from a jewelry box, a penny which had been placed in a wall for several days and other objects to Thomas W. Eagar, an MIT metallurgy professor.

The conclusion wasn't pretty. Eagar found evidence that gases created an acidic condition. The analysis of the Brinckus' wallboard indicated a composition of half gypsum and half cellulose. An exemplar wallboard should be 100 percent gypsum.

Anything less is particularly bad in humid Florida, according to Eagar.

"In our experience cellulose, sulfates and moisture when combined react to form sulfurous acids," Eagar wrote Brincku on Feb. 12. "These acids act as a catalyst causing further decomposition of the cellulose, releasing more moisture, producing more acid and continuing the reaction."

The only solution: Remove the drywall and electrical wiring, which appeared to be 40 years old, not four years old, Edgar said.

The Brinckus are moving out of their dream home and into a rental. Brenda Brincku said the drywall problem has consumed their lives and taken resources away from the couple's landscaping business.

"It's difficult right now. We are in the middle of trying to get moved out," she said. "It's been hard. My husband has broke open the walls to try to do research so I cough a lot more now, at night especially."

Gonzalez said it's best that manufacturers help come up with a solution. Plaintiffs will seek costs for repairs, relocation, inspections and medical monitoring. The lawsuits are expected to carve out claims of negligence, liability, breach of express warranty, unjust enrichment and violation of the state Deceptive and Unfair Trade Practices Act, among other counts.

"Every manufacturer and developer should look at this problem very seriously and try to do what is in the best interest of the homeowner now and work out the legalities between themselves later," Gonzalez said. "But the homeowner shouldn't be the victim of this problem, and they shouldn't have to bear the economic and emotional burden that this carries."