Friday, September 25, 2009
Court holds Chinese drywall maker in default
Jacksonville Business Journal - by Paul Brinkmann
A Louisiana federal judge has declared Chinese company Taishan Gypsum Co. – one of the largest manufacturers of contaminated Chinese drywall imports – in default in a class action lawsuit.
U.S. District Court Judge Eldon Fallon’s order holds the company in default for failing to respond to the lawsuit.
The default ruling has the
potential to heighten the international tension in the unfolding drywall case, said Miami attorney Ervin Gonzalez, of Colson Hicks Eidson.
“The bottom line is: If you want to do business in the U.S., you have to hold companies accountable,” said Gonzalez, co-chairman of the trial committee for multidistrict court panel that is coordinating the federal drywall litigation. “If they’re not willing to appear in a court of the U.S., you shouldn’t be able to do business here.”
At least one national legal group said the ruling is an example of why new federal legislation is needed to hold foreign manufacturers accountable.
The American Association for Justice, formerly known as the Association of Trial Lawyers of America, said in a news release that manufacturers such as Taishan are able to skirt U.S. laws because of multiple obstacles. The organization called for passage of the proposed Foreign Manufacturers Legal Accountability Act of 2009.
“Taishan Gypsum profited from a product they sold here in the U.S. that has now proven to be defective, costing millions of dollars in damage, decreased property values and countless health problems. The ruling today shows the company has turned their back, hoping U.S. consumers, homebuilders and insurance companies will pick up their tab," AAJ President Anthony Tarricone said.
Earlier this week, Nancy Tennenbaum, the new chairwoman of the Consumer Product Safety Commission, told reporters in St. Petersburg that a recall of Chinese drywall appeared unlikely because of logistical problems and multiple manufacturers.Other Chinese defendants in the federal class actions, such as Knauf Plasterboard Tianjin, have responded to the lawsuit by filing an appearance.
The proposed act would require manufacturers to have an agent, located in at least one state where the company does business, that would accept service of process for any civil and regulatory claims. It would also require companies to consent to state and federal jurisdiction, holding foreign manufacturers accountable to those judicial standards.http://jacksonville.bizjournals.com/jacksonville/stories/2009/09/21/daily47.html?ana=tt3245