FEMA Trailer Makers Poised to Hand Over $43 Million Settlement

Manufacturers and contractors responsible for providing the temporary housing that made thousands sick have decided to pay up.

Posted: 05/31/2012 10:32 AM EDT

As the dust settles on a class action lawsuit against the manufacturers and contractors that provided the FEMA trailers for victims of Hurricane Katrina, it appears that thousands who were affected by the toxic trailers will share a settlement payout of $43 million.

Lawyers for the plaintiffs filed an expanded settlement agreement on Monday which previously called for a total of $14.8 million to be paid by two dozen trailer manufacturers. The expanded settlement, which the plaintiff’s attorney’s says a judge could preliminarily approve as early as next week, implicates four additional manufacturers and calls for the $43 million settlement amount. The award will be split between 60,000 plaintiffs and a portion will likely be allotted to attorney’s fees.

Although thousands stand to be compensated for the health issues they suffered as a result of the toxins found in the trailers, the plaintiffs in the settlement make up less than half of the 114,000 households who were provided "FEMA trailers" after Hurricane Katrina. Shortly after families moved into the trailers, many began having respiratory problems as a result of extremely high levels of formaldehyde used in the construction of the trailers.

Formaldehyde was used to make particle board and plywood in the trailers and is an industrial chemical linked to leukemia, nasal cancer and respiratory problems. The government has since banned the chemical’s use for long-term housing.


"The plaintiffs are faced with significant burden of proof issues with respect to causation," Gerald Meunier, a lawyer for plaintiffs told CNN. "For many plaintiffs, the manufactured home no longer exists or can no longer be located. Further, many individual plaintiffs faced causation problems due to the fact that they were smokers or had independent bases separate from formaldehyde exposure for their health issues."

Most of the settlement will come from companies who manufactured the trailers, but a portion of the money will also come from contractors who set up the temporary homes. In addition to the larger settlement, six smaller manufacturers agreed to separate settlements which have not been made public.

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