By Michael Kunzelman
NEW ORLEANS, La. (AP) – A Chinese drywall manufacturer asked a federal appeals court to overturn a judge’s ruling that U.S. courts have jurisdiction over claims that its defective product wrecked thousands of homes.
A three-judge panel from the 5th U.S. Circuit Court of Appeals in New Orleans didn’t indicate how soon it would rule. It heard arguments from lawyers for Taishan Gypsum Co. Ltd. and a group of Virginia homeowners who sued the foreign company.
Plaintiffs’ attorneys argue Taishan can be held accountable in the United States for selling more than $8.5 million worth of its drywall in the U.S. between 2005 and 2008, with much of it going to Virginia-based distributor Venture Supply Inc.
Chinese drywall was used in the construction of an estimated 12,000 to 20,000 homes and businesses, mainly in the South, after a series of destructive hurricanes in 2005 and before the housing bubble burst. The problems caused by defective drywall ranged from a foul odor to corrosion of pipes and wiring – problems that were expensive to fix and, in some cases, drove people from their homes.
Taishan attorney Joe Cyr argued there is no evidence that Taishan knew its drywall would be used in Virginia or that it supplied Venture with a custom-made product.
“Venture Supply never said it was going to distribute the goods in Virginia,” Cyr said.
But two of the judges on the panel sounded skeptical, noting that Venture’s name and telephone number were printed on the boards.
“It was packaged and labeled for the Virginia market. Isn’t that correct?” asked Judge Jennifer Walker Elrod.
“It’s the client’s unilateral decision to put whatever they want on it,” Cyr responded.1 2 next >>