The two largest Chinese Drywall MDL defendants are behaving as if they are addressing different cases entirely. Knauf, a German company whose Chinese subsidiary (a fact they disputed earlier in the litigation) manufactured some of the defective Chinese Drywall which made its way into the United States, and into the homes of hundreds of plaintiffs, has taken what can only be called a conciliatory tone. At the January monthly status conference in the Federal District Court for the Eastern District of Louisiana, Knauf's attorneys pointed out that even though it's pilot remediation program, targeted at 300 homes, has only identified 175 homes to participate in the program to date, it's plan is to expand the scope of the program to the point where the "substantial critical mass" of the homes affected by its product could be identified for remediation by the end of the year. The implication left by Knauf is that their goal is to exit the litigation as soon as possible.
The second, and largest, defendant in the federal MDL litigation is Taishan, a Chinese government-owned company which has been communicating a distinctly confusing message to the court as well as the American public. For months Taishan ignored attempts to secure its cooperation towards discussion of the defective drywall traced to its factories which ultimately ended up being installed in American homes. In statements issued by those speaking directly or indirectly for the Chinese government, denials of any such thing as defective drywall were mixed with bizarre accusations of conspiracies to shake the company down with frivolous lawsuits. At the January status conference attorneys representing Taishan were present, and spoke in defense of their client, but had still not formally entered an appearance in the litigation. They claimed that "there is no factual basis" to even sue Taishan, and that Taishan would be "vindicated of any wrongdoing" when the facts become known. Judge Fallon was left in the unenviable position of granting Taishan's attorneys the time to speak, in spite of their not having entered an appearance, but showed his obvious frustration at Taishan's lack of cooperation by cutting off one of their attorneys by asking him if he had made an apperance in the case yet. When addressing a motion against Taishan for default, Judge Fallon warned their attorneys that the motion would be granted in one week unless they formally entered the litigation by entering their appearance.
The facts surrounding the defective Chinese Drywall litigation are not generally disputed. The drywall has been found to be defective, the origin of the drywall has been established, and the remediation required to address the damage caused by the drywall has been laid out in carefully considered opinions in more than one case. One of the largest defendants in the litigation, Knauf, has reluctantly moved, in small steps, toward a pilot remediation program which could act as a template for a global settlement. Their attorneys have now, apparently, resigned themselves to exiting the litigation via a remediation program which will evolve into a global settlement. On the other hand the largest defendant, Taishan, has continued its unpredictable maneuvering towards an apparent goal of demonstrating its innocence without allowing its attorneys to formally enter the litigation. What can Taishan's strategy be, and is it being hatched in China or by its US attorneys? All eyes will be on next week's showdown, where Taishan attorneys will either appear formally, having entered their appearance, or will suffer another legal setback via a preliminary default judgment. Watch this space for the next chapter.
Posted
Mon, Jan 31 2011 9:28 AM
by
miltstafford
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