New Drywall Revelations, Courtesy of the Tort System

Ben Somberg

June 3, 2010

ProPublica teamed with the Sarasota Herald-Tribune to put out an important investigative piece on drywall a few days ago -- "Tainted Chinese Drywall Concerns Went Unreported for Two Years."

The article, by Joaquin Sapien and Aaron Kessler, reports that:

A leading East Coast homebuilder learned four years ago that the Chinese-manufactured drywall it had installed in several Florida homes was emitting foul odors, according to documents obtained by ProPublica and the Sarasota Herald-Tribune.

The company, WCI Communities, was so concerned that it started planning to tear out the material and rebuild the houses. But it never disclosed the problem to the bulk of its customers or to government authorities.

The evidence comes mainly through a series of emails between several companies in the building process. The article said the documents were from ongoing lawsuits; subsequent articles have said explicitly that the documents have been released by Victor Diaz, an attorney representing homeowners in Florida.

It's early yet in this process. But it strikes me that there may be a useful lesson coming here in the value of the common law system as a complement to the regulatory system. Plaintiffs' attorneys, it appears, have uncovered a development that federal regulators had not found (or certainly had not made public).

There's ideally a side-by-side, cooperative place for the regulatory and tort systems. The role of the common law system is particularly important when the regulatory side is weak, though. We've said previously that we think the Consumer Product Safety Commission's response to the toxic drywall matter has been too slow. It's also important to note that the agency has a small budget and a small staff, and more and more products to monitor. The CPSC has fewer employees today than it did pre-Reagan. It needs all the help it can get.


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