About 55,000 people who lived in fume-filled trailer homes in the aftermath of Hurricanes Katrina and Rita will share in a $37.5 million dollar settlement from the companies that built them. The so-called FEMA trailers used formaldehyde-based insulation and glues that often made the occupants sick. The prefabricated homes were used in Louisiana, Mississippi, Alabama and Texas.
The payout to each plaintiff in the class action suit will be modest. Almost half will go to attorneys’ fees and court costs. However, both sides were eager to avoid individual trials that could have stretched the litigation out for years. Even though FEMA ordered and purchased the trailers, the agency was not part of the suit. Only the trailer manufacturers were targeted. When FEMA inspected the homes they found formaldehyde levels five times higher than normal. Despite the fact that formaldehyde is a known carcinogen, FEMA downplayed the risks for years even as residents complained of nosebleeds, headaches and other illnesses caused by the vapors. When the test results were released, FEMA changed its tune.
The court still has to make a decision on a separate $5.1 million suit against the companies that installed and maintained the trailers. Several people who lived in those trailers were in court when the settlement was announced, and reporters say they seemed disappointed with the outcome. One man said, “We were told not to look for much.” Another remarked, “We’re glad to get it over with.” A court-appointed special master will be responsible for making the payouts.
Source: The Associated Press, “Judge approves $37.5 million toxic FEMA trailer settlement,” Sep. 27, 2012