Today, Congressman Ted Deutch (FL-19) hailed a global class action settlement announced late last night that will help American homeowners affected by contaminated drywall from China. Thousands of homeowners living in South Florida and thirty-eight other states have been victims of defective Chinese drywall that corrodes electrical wiring, damages household appliances, and is associated with an array of serious health problems. The agreement reached between the Plaintiffs’ Steering Committee (PSC) and Knauf Plasterboard Tianjin (KPT), the corporation primarily responsible for the defective drywall, establishes a Remediation Fund and an Other Loss Fund to help relieve homeowners of economic damages.

“This settlement is a victory for thousands of families in Parkland, Boynton Beach, and other communities throughout South Florida and the nation whose lives have been turned upside down due to contaminated Chinese drywall in their homes,” said Congressman Deutch. “For the homeowners who may not be made whole as a result of this settlement, I will continue to work with my colleagues on the House Contaminated Drywall Caucus to pursue accountability from the Chinese government and the manufacturers of this defective product. We must also continue our efforts to strengthen the Consumer Product Safety Commission’s ability to help homeowners and ensure that tainted Chinese drywall is not recycled into additional homes and products.”

The agreement creates two funds from which plaintiffs may recover: the Remediation Fund and the Other Loss Fund. The Remediation Fund, which is uncapped, will pay costs of the three types of relief the class members can choose from: (i) remediation by Moss & Associates, the contractor for the remediation program established by the parties in October 2010; (ii) self-remediation by a qualified contractor of the homeowner’s choosing; and (iii) a cash out option, in which the homeowner can elect to receive a cash payment. The Other Loss Fund, which is capped, will reimburse for certain provable economic loss and provide a review process for individuals who believe they have bodily injury claims. In addition, attorneys’ fees and costs will be paid.

The settlement ultimately is subject to final approval by Judge Fallon, pending a fairness hearing that will be scheduled in 2012. Read a fact sheet on the settlement from KPT here.