NU Online News Service, June 15, 11:27 a.m. EDT
A Florida-based drywall supplier and its insurers have reached a preliminary $55 million settlement with hundreds of Florida homeowners whose homes were damaged by tainted Chinese drywall, according to court documents and a statement.
Miami-based Banner Supply Co.'s insurers—Chartis, FCCI Insurance Co., Hanover American Insurance Co. and Maryland Casualty Co.—will pay the award to affected homeowners.
The settlement comes nearly a year after a Miami-area couple was awarded about $2.5 million from Banner in the first jury trial involving the defective building product, which is said to emit a foul smell, fumes that cause corrosion to plumbing and electrical components, and lead to health problems for homeowners.
The $55 million settlement needs approval from U.S. District Court Judge Eldon E. Fallon in New Orleans. Fallon is handling all ongoing drywall cases.
"We are settling this matter to bring a resolution for our customers and to allow the homeowners to fix their homes," says attorney Michael Paterson of Miami-based firm Paterson and Espino on behalf of Banner. "We regret that this could not have been achieved sooner, but Banner recognizes that prolonged litigation would not have accomplished this goal."
In the same joint statement, Chartis says it is "pleased this settlement resolves this particular matter."
Chinese-made drywall was used in U.S. construction in tens of thousands of homes between 2004 and 2008 when busy hurricane seasons and the housing boom led to shortages of U.S.-made drywall.
Plaintiffs' attorney Russ Herman of Herman, Herman, Katz & Cotlar adds that plaintiffs' attorneys "continue to engage in negotiations with other responsible parties and expect other settlement developments within the next 60 days."
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