Foreign Manufacturers Must be Held to Same Legal Standards as U.S. Businesses

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For Immediate Release: June 16, 2010

Contact: Jennifer Fuson
202-965-3500, ext. 8369
media.replies@justice.org

Foreign Manufacturers Must be Held to Same Legal Standards as U.S. Businesses

Retired Police Officer to Testify about Destruction Chinese Drywall Made to Home

Washington, DC—The American Association for Justice (AAJ) today called for quick passage of the Foreign Manufacturers Legal Accountability Act (S. 1606 / H.R.4678), as the U.S. House Energy and Commerce’s Subcommittee on Commerce, Trade and Consumer Protection today hears oral testimony on the legislation.

Retired police officer William Morgan of Williamsburg, VA, will testify about losing his home to foreclosure after the family was forced to relocate because of defective Chinese-manufactured drywall in his home, essentially rendering the home unsafe and worthless. 

Because Taishan Gypsum, the manufacturer of the drywall, is owned and operated in China, the documents to hold the company accountable in the U.S. legal system had to be translated into Mandarin, with special process servers flying to China to serve the papers.  After months of failing to respond to the legal proceedings, last week Taishan appealed the default ruling held by U.S. District Court Judge Eldon Fallon.  

“Foreign corporations should not be able to profit by selling their products in our country if they do not intend to follow our safety standards, risking the health and safety of U.S. consumers,” said American Association for Justice President Anthony Tarricone.  “Both American businesses and consumers suffer when a foreign manufacturer cannot be held accountable in our legal system.” 

According to a recent analysis by AAJ, 83 percent (312) of the 377 recalls announced by the Consumer Product Safety Commission (CPSC) in 2009 were from foreign manufacturers.  The 2008 CPSC data is similar, when 84 percent (329) of recalls were from foreign manufacturers out of 392 total recalls for the year.

Currently, bringing a case against a foreign manufacturer requires serving legal notice on the company in their country.  This often means translating the papers into the language of the native country and tracking down the companies’ foreign address, adding time and thousands of dollars in expense to the legal process.

The Foreign Manufacturers Legal Accountability Act (S. 1606 / H.R.4678) does several things:

  • Requires manufacturers to have an “agent” located in at least one state where the company does business that would accept service of process for civil and regulatory claims.
  • By registering an agent, companies would consent to U.S. jurisdiction in disputes involving U.S. consumers.
  • The legislation covers products regulated by the Consumer Product Safety Commission (CPSC), such as children’s toys; the Food and Drug Administration (FDA), including prescription drugs and medical devices; and the Environmental Protection Agency (EPA), like pesticides.

Full list of CPSC’s 2009 recalls .

Full list of CPSC’s 2008 recalls .

To speak to William Morgan or his attorney about Chinese drywall, feel free to contact AAJ at 202-944-2896.   

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