Lowe's drywall settlement gets closer to final approval

An amended settlement for people who say they bought tainted drywall from Lowe's, has won preliminary approval in a Georgia state court, according to ProPublica. "Lowe's, the nation's No. 2 home improvement chain, is offering as much as $100,000 in cash to customers who can prove they bought drywall from the retailer and also prove that it caused at least $4,500 in damages," the investigative website reported.

News of the settlement offers a faint glimmer of hope to some of the 7,000 homeowners whose residences are affected by contaminated drywall made in China. But only to those who can prove they purchased their drywall from Lowe's.

Last year, Lowe's negotiated a settlement that offered victims a maximum of $4,500 in cash and gift cards. But after ProPublica and the Sarasota Herald-Tribune reported that the settlement "Offers Small Payouts to Victims, Big Fees for Attorneys," Lowe's returned to the negotiating table and offered its customers an enhanced settlement of up to $100,000.

The settlement includes several levels of compensation: A $50 gift card for those who have no proof of purchase but sign a form saying they bought drywall from Lowe's and a $250 gift card for those who have proof of purchase but no documentation that they suffered damages, ProPublica reports. Homeowners who qualified for the original maximum payment of $4,500 will receive a notice informing them that they are now eligible for up to $100,000 in cash.

The amended settlement will be advertised at the bottom of all Lowe's receipts and in three national publications: Parade Magazine, USA Weekend, and National Geographic. Homeowners who think they have a claim can file one on the informational website for the class action suit. The next hearing on the settlement will be October 12.

A week ago we reported that the federal task force on drywall reversed earlier guidelines by advising that affected homeowners no longer need to replace all the wiring in their homes. Adding to the confusion, the Consumer Product Safety Commission and the Department of Housing and Urban Development recommend replacing selected electrical components such as outlets and fire and smoke detectors.

Yesterday, senators Bill Nelson (D-FL) and Mark Warner (D-VA) urged the CPSC to invite public comment on the new recommendations. "The decisions homeowners make in response to these protocols will have a bearing on the future value and insurability of their homes," the senators wrote in a letter to the agencies. "With such economically-significant decisions in the balance, it is critical that your agencies get this decision right for homeowners."

Follow ProPublica's drywall coverage on its website.

—Mary H.J. Farrell