What evolved into one of the largest consumer settlements in U.S. history began with persistent plumbing leaks in suburban neighborhoods in Sun Belt boomtowns in the 1980s.
Homeowners in the Houston area contacted Moriarty Leyendecker and co-counsel when the "revolutionary" new plumbing in their new homes repeatedly failed. Our investigation quickly determined that the homes contained polybutylene plastic plumbing or the "greatest thing since sliced bread," as it was marketed to homebuilders. Polybutylene plumbing was said to be more flexible, easier to install and cheaper than traditional materials such as copper.
As leaks began to affect neighborhoods throughout the nation, many homebuilders were reluctant to address the problems. They blamed the plumbing subcontractors or manufacturers who then blamed the raw materials suppliers. Homeowners throughout the nation faced misery as their homes and possessions were repeatedly damaged by leaks, and the neighborhoods came to be known for construction problems.
Behind the scenes, the polybutylene industry - which was led by raw materials suppliers Shell Chemical, Hoechst Celanese and DuPont, among others - retained some of the largest and most powerful law firms in the nation. They intended to overwhelm consumer lawyers representing affected homeowners. The industry also had a big secret to keep. The fact was, polybutylene pipes and the plastic and metal fittings used to connect them would corrode and ultimately leak when exposed to heated and chlorinated water, and industry insiders knew it.
Publicly, the polybutylene industry lawyers downplayed consumer problems. The industry bitterly fought almost all of the early homeowner lawsuits that were filed in courts around the nation, making the litigation as unpleasant as possible for homeowner claimants. One defense lawyer sneered at a Houston courthouse that he would be surprised if the plumbing problems affected 10,000 people. When the national scope of the problem became irrefutable, the industry blamed plumber "installation error" and occasionally even the homeowners. The legal fight went on and on.
Moriarty Leyendecker is proud to have helped build the legal team that exposed the truth of polybutylene plumbing and enabled polybutylene-affected homeowners to repair their homes and move on with their lives. With innovative use of computers, we established liability document and client databases that rivaled or exceeded the capabilities of the big law firms. We represented thousands of clients individually, not initially in class actions, and ensured that every phone call, letter or e-mail got a prompt response. With the leadership of co-counsel Steve Hackerman, our liability team built a devastating case after reviewing a million pages of evidence. And, when we needed a nationally respected mediator for settlement negotiations, we brought in Kenneth Feinberg, who subsequently served as special master of the federal September 11th Victim Compensation Fund and now serves as the special master monitoring executive compensation at U.S. financial institutions that took federal TARP bailout funds.
By the mid-1990s, the polybutylene industry could no longer avoid the truth of its products. The industry was brought to the negotiation table by the large number of homeowner damage claims, rejection by homebuilders and construction code bodies, and extensive news coverage, including CBS 60 Minutes, which revealing the truth of polybutylene plumbing.
In 1995, we were part of the legal team which reached the largest property damage class action settlement in U.S. history at the time. The settlement covered an estimated six million housing units that contained polybutylene plumbing - about 600 times as many consumers as the defense attorney originally claimed were affected.