Southwest Florida homeowners who had their homes built with Chinese drywall provided by Banner Supply Co. will get a piece of a $55 million settlement pie.
The proposed settlement announced Tuesday would resolve a portion of thousands of homeowners' claims against Florida-based Banner, several related companies and its insurers, because of damage caused by the defective drywall.
The drywall, imported mostly between 2004 and 2008, corrodes air conditioning coils, electrical wiring, plumbing fixtures and other metal elements in the home, including appliances and jewelry. Homeowners with the drywall complain of health problems from respiratory illness to nosebleeds.
Attorneys for the homeowners and Banner are urging federal Judge Eldon Fallon, who presides over thousands of drywall cases merged in multidistrict litigation in New Orleans, to approve the deal.
The $55 million would come from four of Banner's insurers: Chartis, FCCI Insurance Co., Hanover American Insurance Co. and Maryland Casualty Co.
"This is a global resolution, all the monies that Banner has in insurance, every dollar they have," said attorney Ervin Gonzalez of Miami, a principal negotiator and one of three lead counsels for the plaintiffs.
But even $55 million won't be enough to pay for all the damage done to Chinese drywall homes.
Gonzalez said the plaintiffs' attorneys were able to identify 2,000 homes with drywall from either Knauf Plasterboard Tianjin or Taishan Gypsum that was supplied by Banner.
All homes are south of Orlando, but he could not specify how many are in Lee, Collier or Charlotte counties.
The average cost of fixing a home with the defective drywall, which involves stripping it down to the studs and rebuilding it, is about $100,000.
If 2,000 homes have drywall supplied by Banner, that means it would take $200 million to fix them.
"We are going to need manufacturers and others to be accountable," Gonzalez said.
In a written statement, Russ Herman of New Orleans, another lead attorney for the plaintiffs, said they will "continue to engage in negotiations with other responsible parties and (they) expect other settlement developments within the next 60 days."
Knauf Plasterboard Tianjin has begun a pilot program in a separate settlement to fix about 300 homes built with its drywall.
Several of the homes are in Cape Coral, including the home of Richard Kampf, who opted to fix his home himself by taking out loans. Kampf is hoping to recover some of the renovation money from Knauf, but the drywall also was supplied by Banner.
"I think the settlement has got to be a positive," Kampf said. "It adds to the collective pool of money that could be used to fix these homes."
Banner had six locations in Florida, including one in Fort Myers. The company purchased about 1.4 million sheets of Chinese drywall, but claims it didn't know of defects.
Michael Peterson of Miami, Banner's counsel, said in a statement: "We have learned certain facts during the litigation that lead us to believe that certain manufacturers made misrepresentations regarding their Chinese-manufactured drywall."
Bill Hilldin, spokesman for Banner Supply, said there would be no other comment to questions from The News-Press.
"Our business has thrived for over 58 years because our customers have trusted us," Banner's statement said. "We are settling this matter to bring a resolution for our customers and to allow the homeowners to fix their homes. We regret that this could not have been achieved sooner, but Banner recognizes that prolonged litigation would not have accomplished this goal."