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PROPERTY OWNERS AND SIDING MANUFACTURER ENTER INTO SETTLEMENT

Aug 21, 1997

Asbestos Property Litigation Reporter

Also:

Consumer Product Litigation Reporter

Mass Tort Litigation Reporter

Siding: Naef v. Masonite Corp.

Property Owners and Siding Manufacturer Enter into Settlement

A class of property owners and Masonite Corp. have reached a settlement, subject to court approval, that would provide regionally adjusted replacement costs of damaged siding to class members. Naef et al. v. Masonite Corp. et al., No. CV-94-4033 (AL Cir. Ct., Mobile Cty., proposed settlement July 14, 1997).

According to plaintiffs' attorney John Crowder of Cunningham, Bounds,

Yance, Crowder & Brown in Mobile, AL, all qualified claims will be paid in full. There is no cap on the settlement amount, Crowder said.

If the Mobile County Circuit Court grants preliminary approval to the proposed settlement, claims information will be sent to class members this month. Attorneys for the plaintiffs have requested that the final settlement approval hearing take place in November of this year.

The class is defined as all individuals across the United States who own a house or other structure upon which Masonite hardboard siding, manufactured since 1980, has been installed. The lawsuit alleges that the siding is subject to moisture invasion problems, and that as a result of this defect, the product swells, buckles, and prematurely rots, causing damage to property on which it is installed.

The plaintiffs further allege that Masonite has failed to disclose its knowledge of the design defect, and, in fact, has actively concealed this information from the property owners and public. The lawsuit seeks compensatory damages, replacement of the siding, and punitive damages on behalf of all property owners.

Masonite blamed the condition on faulty installation. However, a Mobile, AL jury in September 1996 determined that Masonite's product was defective and scheduled the damages phase of the trial to begin last month. The parties entered into a settlement on July 14.

Although the exact sum of the settlement will be determined by the amount of valid claims, Crowder expects the number to be in the hundreds of millions. Masonite sold over 6 billion square feet of the siding, which has been used on more than 4 million homes, he said.

"If this settlement is approved, property owners are going to get many more times greater than what they would receive under their warranty," Crowder says. "Some people will receive 100% reimbursement for their property damage."

Upon the court's approval, Crowder added, a national notice of the settlement agreement will be issued. At that point, people will have the opportunity to join the class or opt out of the settlement.

In addition to Mr. Crowder, the class is represented by Robert T. Cunningham Jr. of Cunningham, Bounds, Yance, Crowder & Brown in Mobile, AL; Richard Dorman of McRight, Jackson, Dorman, Myrick & Moore in Mobile; Ralph I. Knowles, Jr., Everette Doffermyre and Leslie Bryant of Doffermyre, Shields, Canfield & Knowles in Atlanta; and Elizabeth J. Cabraser, Jonathan D. Selbin and Fabrice V. Nijhoff of San Francisco's Lieff, Cabraser, Heimann & Bernstein.

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