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Between 2004 and 2006 when there was a housing boom, large contracting companies obtained much of their drywall from Chinese companies. They paid a low price and it was easy to obtain, so all seemed fine. It is actually a German brand called Knauf drywall and was made in China. However, it has since become clear why this drywall was cheap – it was made out of waste materials from Chinese power plants using coal and it gives off a bad smell.

The U.S. Consumer Product Safety Commission is investigating this situation, trying to learn whether the gases emitted from the drywall, which smell like sulfur, are toxic, and if so, how toxic.

One of the Chinese companies that made this drywall was Taishan Gypsum Co, Ltd. It shipped drywall to Florida and from there it was trucked to California, New York, Louisiana, and Virginia. Louisiana used it extensively since Habitat for Humanity bought a stockpile of it and used it in building over 600 houses. As many as 40 states may have used some of this drywall and defective product lawsuits have been multiplying for months. As many as 50,000 houses may be involved.

Banner-Knauf Agreement

According to documents unsealed on June 4 in Miami-Dade Country, Florida, Knauf Plasterboard Tianjin Co. Ltd. sold thousands of drywall sheets to Banner Supply, a Florida company. Banner complained about the smell and the documents state that Knauf Plasterboard urged Banner to resell them “overseas”. Banner refused and the two companies then made a deal:

  • Knauf would replace Banner’s drywall with about $500,000 worth of American drywall and Banner would refrain from suing Knauf and from mentioning the problem to its customers, government regulators, or the news media.

It is not clear whether Banner knew that the drywall was corrosive and dangerous, as subsequent lawsuits have claimed. Banner spokesmen have said the company stopped using it in early 2007 after some South Florida complaints were received about a smell like rotten eggs.

Recent Developments

Repair of houses built with this drywall is expensive, since each house must be stripped down to its frame. In May this year, a District Court Judge in Louisana, one Eldon E. Fallon, signed a judgment against Taishan ruling that the seven homeowners should receive $2.6 million between them.

On June 12, Taishan appealed this ruling to the Fifth Circuit Court of Appeals – the first time this company has participated in any of these U.S. legal proceedings.

If you are wondering about your own house but not noticing any bad smell, one sign to look for is black soot on wires behind your light switch plates. There might also be some on your washer or dryer plugs and in the air conditioning coils.

If you have been injured by a defective product, our product liability lawyers are ready to help. Please contact our Mobile Alabama office today for a free case evaluation.

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