GAF Reaches Tentative Settlement with Customers, Avoids Trial

GAF Materials Corporation announced this week that a tentative agreement has been reached to resolve lawsuits over its allegedly defective shingles. Attorneys for GAF made the announcement and, though no details have been released yet, the proposed settlement looks set to bring an end to the lawsuits before the first case would have gone to trial.

Negotiating the settlement may take some time, and it remains to be seen just how satisfied plaintiffs will be

The settlement – which presumably will allow GAF customers to obtain compensation if they’ve suffered damages due to defective shingles – follows the company’s earlier attempts to defeat a class action filed over the allegedly defective roofing product. At the time, GAF argued that the litigation should not proceed as a class action, because individual assessments would be needed to establish the cost of damages. The presiding judge, U.S. District Judge J. Michelle Childs, disagreed and allowed the case to move forward as a class action. Customers claimed that GAF shingles produced and sold between 1999 and 2007 were prone to crack prematurely, causing moisture penetration and property damage. Customers also accused the company of violating warranties and deceiving customers about the quality of its shingles.

In January 2013, GAF asked Judge Childs to remove the warranty claims from the lawsuit, arguing that the charges were unfair. Judge Childs rejected that request– although she did throw out certain claims for fraud and negligence under Virginia’s five-year statue of repose and Pennsylvania’s economic loss doctrine, which generally forbids negligence actions for purely economic damages.

GAF manufactures shingles at several sites throughout the United States. According to the lawsuits, shingles manufactured at the company’s Mobile, Alabama factory cracked at a much higher rate than those produced at other GAF facilities, suggesting that the shingles suffered from an inherent defect that could not be blamed on customers. Nevertheless, GAF seems happy with the proposed agreement, and although the terms of the settlement have not yet been finalized, a company spokesman reported they were “highly pleased.”

It looks – initially – like a good result, with customers in a position to receive compensation for a problem they could not have foreseen, and GAF willing to negotiate after the threat of the lawsuits going to trial. It’s far from over, though – negotiating the settlement may take some time, and it remains to be seen just how satisfied plaintiffs will be when all is said and done.