On January 15, 1998, the Circuit Court of Mobile County, Alabama, granted approval to a settlement reached by plaintiffs, the Masonite Corporation and International Paper that provides regionally adjusted replacement costs for damaged siding to class members who make a qualified claim.
Plaintiffs in this action have alleged that hardboard siding manufactured by Masonite Corporation has been incorporated into homes, any structures, and rental properties and will rot, buckle, discolor, deteriorate, and cause damage to other parts of the buildings.
Masonite Corporation is a leading manufacturer of a product made from wood fiber, wax and resins that is widely known as hardboard siding. Masonite® siding is distributed both in lap (board) and panel (4x8 & 4x9 sheet) applications, each available in various external textures designed to look like conventional lumber siding.
Masonite Corporation markets its siding products for a variety of external construction uses, including exterior siding for residential and other structures. This lawsuit does not concern Masonite® products used for interior, roof, wall substrate, plywood or deck sheathing, or for purposes other than exterior siding. The lawsuit also does not concern oriented-strand board (OSB) siding.
If you do not already know whether you have Masonite® Hardboard Siding on your property, there are several steps you may take to make that determination. You may wish to contact the builder of your property; you may remove a board or sheet of the siding and inspect the reverse side; or, if you have a garage with the back side of the siding exposed, you may look there. Scott's Painting & Staining Inc. can also help you determine the manufacturer.
Not all hardboard siding is manufactured by Masonite Corporation. The Masonite name is often used improperly to refer to other manufacturers' brands of hardboard siding. Masonite® is a registered trademark of Masonite Corporation. Another manufacturer with a current lawsuit is Weyerhaeuser. If you think that Weyerhaeuser is the manufacturer you are looking for, then click here.
Masonite® siding is typically identified by a stamp of the name "Masonite" and/or the number "X-90" on the siding itself. You may also take a piece of your siding to your local building supply store, which may be able to assist you. As part of the claims process, you will be required to establish that you have Masonite® Hardboard Siding on your property.
The stamps on the back of most Masonite® siding will typically be one of the following:
Also, note that all siding products have the liquid slip sheet applied on the backside except for Colorlok.
The corporate logos or brand name as shown below are used to positively identify hardboard siding products manufactured by Masonite Corporation. Any of these brandings may appear on the back of the siding.
You can probably file a claim if:
The text of the Settlement Agreement follows:
WHEREAS the Plaintiffs in this Action represent homeowners and developers who own homes, structures or rental properties into which Masonite Hardboard Siding was installed and incorporated from January 1, 1980 to the date of Final Order and Judgment in this Action; and
WHEREAS the Plaintiffs in this Action have alleged that Hardboard Siding manufactured by Masonite Corporation that has been incorporated into homes, any structures, and rental properties will rot, buckle, discolor, deteriorate, and cause damage to other parts of the buildings; and
WHEREAS the Plaintiffs in this Action have alleged that members of the Class have suffered and will continue to suffer irreparable harm and therefore seek money damages as a result of the damage described above; and
WHEREAS the Plaintiffs in this Action have agreed that an appropriate compromise of these claims is to measure the Plaintiffs' alleged compensable damages by the cost of removal and replacement of damaged Siding, or in some cases the cost of refinishing damaged Siding; and
WHEREAS Masonite Corporation and International Paper Company have denied and continue to deny each and every allegation and all charges of wrongdoing or liability of any kind whatsoever asserted or which could have been asserted in this Action; and
WHEREAS Masonite Corporation and International Paper Company have agreed to enter into this Settlement Agreement in order to put to rest all controversy and to avoid further expense and burdensome, protracted and costly litigation which would be involved in defending this Action, without in any way acknowledging any fault or liability.
NOW, THEREFORE, THIS AGREEMENT is entered into this 9th day of September, 1997, by and among (1) the Plaintiffs in this Action, for themselves and on behalf of the Class as defined below (the "Class"); and (2) Defendants Masonite Corporation and International Paper Company (as defined below and collectively "Defendants").
Subject to Court approval as required by the Alabama Rules of Civil Procedure and as provided below, it is hereby stipulated and agreed by the Parties that, in consideration of the promises and covenants set forth in this Agreement and upon the entry by the Court of a Final Order and Judgment approving the settlement and directing the implementation of the terms and conditions of the this Agreement, this Action shall be settled and compromised upon the terms and conditions set forth below.
As used in this Agreement and the attached Exhibits, in addition to any definitions elsewhere in this Agreement, the following terms below shall be defined as follows:
1.1 "Action" means the above-captioned action, Judy Naef, et al. v. Masonite Corporation, et al., Mobile County, Alabama, Circuit Court No. CV-94-4033.
1.2 "Agreement" or "Settlement Agreement" means this Settlement Agreement, including all Exhibits.
1.3 "Claim" or "Claims" means a claim submitted pursuant to the Claims Program established by this Agreement.
1.4 "Claims Administrator" means the firm hired to process Claims in accordance with Section 9 of this Agreement.
1.5 "Claim Program" means the procedure set forth in Section 5 below.
1.6 "Claim for Un-Reimbursed Expenditures" means a Claim described in Section 5.3 in the form attached as Exhibit "A," and filed with the Claims Administrator.
1.7 "Claim Form" means a claim form referred to in Section 5.4 of this Agreement in the form attached as Exhibit "B," and filed with the Claims Administrator.
1.8 "Claims Period" or "Term of Agreement" or "Term" means: (a) for owners of homes, structures, or rental properties with Masonite Hardboard Siding installed from January 1, 1980 through December 31, 1989, seven (7) years from Final Order and Judgment in this Action; and (b) for owners of homes, structures or rental properties with Masonite Hardboard Siding installed from January 1, 1990 through the date of the Final Order and Judgment in this Action, ten (10) years from Final Order and Judgment in this Action.
1.9 "Class" means the class composed of all Persons who have owned, or own, Property on which Masonite Hardboard Siding has been incorporated and installed in the United States and United States Territories from January 1, 1980 to the date of Final Order and Judgment in this Action. All Persons who, in accordance with the terms of this Agreement, properly execute and file a timely request for exclusion from the Class are excluded. This Agreement is without prejudice to the rights of Plaintiffs to continue the prosecution of the Naef Action as a class action in the event this Settlement Agreement is disapproved, reversed, vacated, or terminated by Defendants pursuant to this Agreement, and is without prejudice to the rights of the Parties to (a) take action in support of or opposition to certification in this Action should the Settlement not be approved or implemented for any reason for any reason; (b) only in the event that this Settlement Agreement is disapproved, reversed, vacated or terminated by Defendants pursuant to this Agreement, preserve any appellate rights until Final Order and Judgment and any appeals therefrom or expiration of the time to appeal with no appeal taken; (c) take action in support of or opposition to certification in any other proposed or certified class action; or (d) use the certification of the class in this Action to support or oppose certification of any other proposed Class arising out of the claims asserted in this Action.
1.10 "Class Member" means a member of the Class.
1.11 "Compensation Formula" as it relates to the alleged property damage to a claimant's Property is the measure of damages applied to a Class Member with a claim compensable under this Agreement. The Compensation Formula shall be applied by multiplying the number of square feet of Siding determined to have sustained Damage as defined in this Agreement, times the cost of Siding replacement or refinishing as the case may be and as further explained below.
(a) For Damages as defined in Section 1.13(1)-(4), and (7)-(8) below, siding replacement shall be the measure of damages. In such cases, the Compensation Formula shall be determined by reference to Mean's Price Data as published by R.S. Means Company (the "Initial Means Price") for the costs of removal and replacement of siding, including an appropriate adjustment for waste and overlap, adjusting the cost for such geographic areas as are agreed upon by the Parties. The siding cost portion shall be determined by averaging the cost per square foot of oriented strand board ("OSB") siding, hardboard siding, and solid wood siding available in that area, with the cost of the solid wood siding component of this Compensation Formula being capped at 115% of the average price R.S. Means Co. establishes by area for hardboard and OSB. The cost of permits actually incurred for siding repair or replacement work conducted in conjunction with this Agreement shall be reimbursed by Defendants to Eligible Claimants in the actual amount or $100, whichever is less, of each required permit.
(b) For Damage as defined in Section 1.13(5) and (6) below, Siding refinishing shall be the measure of damages. In such cases the Compensation Formula shall be determined by the Initial Means Price for the cost of appropriate refinishing, adjusting the cost for such geographic areas as are agreed upon by the Parties. In the case of primer peel "refinishing" shall include the cost of sanding the affected area as necessary, priming and repainting. In the case of wax bleed "refinishing" shall include appropriate washing and priming of the affected area with an oil-based primer and repainting the wall section. If Damage recurs within five (5) years after refinishing, then the Compensation Formula will apply as described in subsection 5.8(a). For Claims recurring after 5 years or more after refinishing, the Compensation Formula will apply as described in this Section 1.11(b).
(c) With respect to the Compensation Formula set forth above, the Initial Means Price will be adjusted annually for inflation.
1.12 "Court" means the Circuit Court of Mobile County, in which the Action is pending.
1.13 "Damage," "Damages," and "Damaged" as it relates to the installation and incorporation of Masonite Hardboard Siding into Property means any of the following:
Damage does not include (i) intentional, reckless or negligent physical damage to Siding (unrelated to installation or maintenance or weather) caused directly or indirectly by a Claimant or other Person; or (ii) damage to Siding to the extent resulting from natural disaster including, but not limited to, fire, hurricane, flood, earthquake, earth movement, or other similar force major events.
1.14 "Date of the Claim" means the date or dates on which Claims were submitted under this Agreement by an Eligible Claimant with respect to damage to a home or other structure as a result of the installation and incorporation of Masonite Hardboard Siding.
1.15 "Date of Installation" means the date or approximate date that Masonite Hardboard Siding was installed and incorporated into the Property of a Class Member. In the absence of proof of installation on a different date, the Date of Installation and incorporation will be presumed to be the date of certificate of occupancy or first purchase of the Property. If the Claimant does not know the date of installation, the Independent Inspector shall make a good faith estimate of such date after first having verified that the siding is Masonite Hardboard Siding.
1.16 "Defendants" means Masonite and International Paper.
1.17 "Eligible Claimant" or "Claimant" includes the following:
"Eligible Claimant" and "Claimant" does not include persons, associations, or entities who made claims to or filed lawsuits against Defendants, were represented by counsel other than Plaintiffs' Class Counsel as defined in Section 1.31 below, and whose claims or lawsuits were resolved either by payment, release or judicial action.
1.18 "Fairness Hearing" means the settlement approval hearing(s) to be conducted by the Court in connection with the determination of the fairness, adequacy and reasonableness of this Agreement in accordance with Ala. R. Civ. P. 23 and the settlement approval procedures recommended by the Manual for Complex Litigation 3d.
1.19 "Final Order and Judgment" means the Order to be entered by the Court, in a form that is mutually agreeable to the Parties, approving this Agreement as fair, adequate and reasonable and in the best interests of the Class as a whole in accordance with Ala. R. Civ. P. 23(e), and making such other findings and determination as the Court deems necessary and appropriate to effectuate the terms of this Agreement.
1.20 "International Paper" means International Paper Company, its divisions, successors, assigns, and subsidiaries, excluding Masonite.
1.21 "Independent Inspector" or "Inspector" means the firm(s) or person(s) hired, selected and trained in accordance with Section 6 below to evaluate claims submitted pursuant to the terms of this Agreement.
1.22 "Initial Notice Date" means the first date upon which the Notice of Proposed Class Action Settlement is initially mailed to the Class pursuant to Section 7 of this Agreement.
1.23 "Masonite" means Masonite Corporation, its divisions, successors, assigns, and subsidiaries.
1.24 "Masonite Hardboard Siding" or "Siding" means any exterior hardboard lap or panel siding or trim manufactured by Masonite from January 1, 1980 through the date of Final Order and Judgment in this Action.
1.25 "Means Price Data" means the data supplied by the R.S. Means Co., Inc. for the appropriate locations and time period as agreed upon by the Parties.
1.26 "Notice of Proposed Class Action Settlement" means the Court approved Notice to Class Member of Proposed Settlement in the form attached as Exhibit "C" to this Agreement.
1.27 "Opt-Out Period" means the 60-day period from the date of the commencement of the notice period for the Notice of Proposed Class Action Settlement.
1.28 The "Parties" means Plaintiffs and the Plaintiff Class, Masonite and International Paper.
1.29 "Person" means any individual or legal entity or their successors or assigns.
1.30 "Plaintiffs" means the individuals acting as named Class representatives in this Action as of December 31, 1996.
1.31 "Plaintiffs' Class Counsel" means the following counsel: McRight, Jackson, Dorman, Myrick & Moore; Cunningham, Bounds, Yance, Crowder & Brown; Doffermyre, Shields, Canfield, Knowles & Devine; Lieff, Cabraser, Heimann & Bernstein, LLP; Levy, Ram & Olson LLP; and Cohen, Milstein, Hausfeld and Toll.
1.32 "Preliminary Approval" means the Court's preliminary approval of this Agreement.
1.33 "Property" and "Properties" means any structure including homes, mobile homes, town homes, condominiums, apartments, commercial structures, garages, and other types of buildings or structures into which Masonite Hardboard Siding was installed and incorporated or as to which money was spent to replace damaged Masonite Hardboard Siding.
1.34 "Settled Claim" means any claim, liability, right, demand, suit, matter, obligation, damage, including consequential damages, losses or costs, actions or causes of action, of every kind and description that the Releasing Party (as defined in Section 13.1 of this Agreement), had, or may have, against any of the Defendants, arising out of the subject matter of this lawsuit, whether known or unknown, suspected or unsuspected, asserted or unasserted, which if known by the Releasing Parties as defined in Section 13.1 would have materially affected his Settlement with the Releases (as defined in Section 13.1), accrued or which may thereafter accrue, including, and regardless of legal theory and the type of relief or damages claimed, claims of damage to Class Members' homes or other structures or for injunctive or declaratory relief as a result of the installation and incorporation of Masonite Hardboard Siding. Without limiting the scope of the foregoing, "Settled Claims" shall include, property damage to Class Members' homes or other structures or personal property as a result of the installation and incorporation of Masonite Hardboard Siding:
However, "Settled Claims" do not include any claim or claims arising from the installation of new Masonite Hardboard Siding manufactured following the entry of Final Order and Judgment in this Action.
1.35 "Settlement Date" means the date on which the Final Order and Judgment is entered.
2. SETTLEMENT PURPOSES ONLY
2.1 This Agreement is for settlement purposes only, and neither the fact of, nor any provision contained in, this Agreement or its Exhibits, nor any action taken hereunder shall constitute, be construed as, or be admissible in evidence as, any admission of the validity of any claim or any fact alleged by Plaintiffs in this Action or in any other pending or subsequently filed action or of any wrongdoing, fault, violation of law, or liability of any kind on the part of Defendants or admission by Defendants of any claim or allegation made in this Action or in any action, nor as an admission by any of the Plaintiffs, members of the Class, or Plaintiffs' Class Counsel of the validity of any fact or defense asserted against them in the Action or in any action.
3. SUBMISSION FOR PRELIMINARY APPROVAL
3.1 As soon as possible after execution of this Agreement, the Parties shall jointly submit this Agreement, through their respective attorneys, to the Court for Preliminary Approval.
4. SETTLEMENT ADMINISTRATION
4.1 Subject to the requirements of Section 5, Defendants shall provide sufficient funds to the Claims Administrator for payment of all Claims within thirty days of notice of approval thereof by the Claims Administrator. Defendants shall be responsible for the payment of all Claims under this Agreement.
4.1.1 There will be an expedited claims procedure for Class Members who have listed, posted or advertised their home or structure for sale or who are experiencing water intrusion into their homes which they have contracted to repair. If such Claims are filed before the entry of Final Order and Judgment but after a Claims Administration procedure is in place, the Claims Administrator will provide the relief to the Class Members to which they would be entitled as if Final Order and Judgment had been entered. Such relief will be conditioned upon the execution and delivery of a release by the Class Member consistent with Section 13 of this Agreement.
4.2 If timely payments are not made in accordance with Section 4.1 above, Class Members whose Claims have been approved and remain unpaid for a period of 90 days thereafter may pursue whatever legal remedies are available to them without regard to the release of claims provided in this Agreement and such claims thereafter shall be governed by the provisions of Section 15.1.
4.3 Defendants shall commence distribution of the Notice of Proposed Class Action Settlement or as ordered by the Court. Any amounts expended on the Notice of Proposed Class Action Settlement are non-refundable.
5. CLAIM PROGRAM
5.1 Only Eligible Claimants (as defined in Section 1.17) are eligible for participation in the Claim Program as defined in Section 1.5 of this Agreement.
5.2 Eligible Claimants shall be entitled to recover money under the Compensation Formula pursuant to this Agreement if:
(i) damage to their home or structure has occurred as a result of the installation and incorporation of Masonite Hardboard Siding into their Property;
(ii) there is Damage that falls within the definitions of "Damage" in Section 1.13 above;
(iii) the Damage occurred during the Term of this Agreement;
(iv) the Damage was not caused by certain enumerated causes described in Section 5.7 below; and
(v) the Eligible Claimant files a Claim within the Term of this Agreement.
5.3 If an Eligible Claimant paid to repair any Damage compensable under this Agreement prior to the date of Final Order and Judgment in this Action, he or she is eligible to participate in the Claims Program, if he or she provides proof as provided in Section 5.3.1 below, and files a Claim for Un-Reimbursed Expenditures. The Claims Administrator will have discretion to allow Claims for Un-reimbursed Expenditures made in good faith without knowledge of this Agreement or the Claims Program and within eighteen (18) months of the commencement of the Settlement Notice Program. Claims in accordance with this Subsection may not be made for refinishing alone, but where Siding has been replaced the costs associated with painting the replacement siding may be recovered.
5.3.1 In order for an Eligible Claimant to receive compensation for Unreimbursed Expenditures described in this Subsection, such Claimant must provide proof satisfactory to the Claims Administrator of the following facts:
An Eligible Claimant may, in seeking to satisfy the proof requirements of subsections (a) and (b) of this Section, submit both (i) photographs showing damaged Masonite Hardboard Siding and (ii) invoices or bills or other documents identifying the siding as Masonite Hardboard Siding. Masonite may offer evidence to the Claims Administrator that the above requirements of Subsections (a) and (b) have not been satisfied. In the event that the Claim above involves damaged associated with partial replacement of Siding or repairs to Siding, Masonite also may elect to inspect the subject Property to confirm the existence of Masonite Hardboard Siding.
5.3.2 Claimants submitting a Claim for Un-reimbursed Expenditures pursuant to Section 5 shall be entitled to the lesser of the amount of such Un-reimbursed Expenditure or the amount to which they would have been entitled under the Compensation Formula.
5.4 To recover under this Agreement, a Class Member must properly complete a Claim Form or Claim for Un-Reimbursed Expenditures (Exhibits B and A, respectively). Class Members may call the Toll-Free Number administered by the Claims Administrator to obtain information about the Settlement Agreement. The Claims Administrator will then forward to the Class Member a Claim Form (Exhibit B) or a Claim for Un-Reimbursed Expenditures (Exhibit A).
5.4.1 The following basic information will be obtained when the Class Member submits a Claim Form, or Claim For Un-Reimbursed Expenditures:
5.4.2 When a Claimant submits a Claim Form the Claimant must also submit one of the following:
The requirement of this Section is satisfied if the Masonite Hardboard Siding warranty claims database confirms that the siding on the subject Property is Masonite Hardboard Siding.
5.4.3 Data from all Claim Forms and Claims for Un-Reimbursed Expenditures shall be entered into the Claims Administrator's computer system for processing and the data base shall be available to the Independent Inspector and the Parties.
5.5 Once a properly completed Claim Form has been received by the Claims Administrator, an Independent Inspector will be sent as soon as practicable to inspect the Property. However, after the expiration of one year from the commencement of the Claims Administration program, the Claims Administrator will use its best efforts to ensure that such inspections occur within 60 days from the date the Claim Form is received by the Claims Administrator.
5.6 The inspection by the Independent Inspector shall include the following:
a. A determination as to whether the structure(s) are sided with Masonite Hardboard Siding;
b. A determination of the approximate Date of Installation of Masonite Hardboard Siding into the structure or home;
c. A determination as to whether any such Masonite Hardboard Siding has sustained Damage as defined in Section 1.13 above, and the amount thereof; and
d. A deduction from the amount of any Damaged Masonite Hardboard Siding for that amount of Damage caused by one or more of the Causation Exceptions detailed in Section 5.7 below.
5.7 All Eligible Claimants with Masonite Hardboard Siding that meets the definitions of Damage set forth in this Agreement in Section 1.13 shall be entitled to payment under the Compensation Formula unless such Damage is caused by one or more of the Causation Exceptions listed below. The Causation Exceptions listed below must be clearly observable to the Independent Inspector without intrusive testing and must be determined by him or her to be the sole, independent cause of the Damage in question. Any doubt by the Independent Inspector as to the existence or extent of these Causation Exceptions will be resolved in favor of the homeowner. If any part of a board is determined to be Damaged for reasons unrelated to the Causation Exceptions and, in addition, there is Damage on the board attributable to one of the Causation Exceptions, then the entire board will be treated as compensable. The Causation Exceptions apply to Damage caused by the following:
5.8 After completion of the inspection, the Independent Inspector will forward a completed Field Inspection and Evaluation Form (Exhibit "D") for each Claim inspected to the Claims Administration and the Parties. The Claims Administrator will determine the amount on Eligible Claimant shall be paid based on the information contained in the foregoing Form prepared by the Independent Inspector, the Compensation Formula as applied to the affected Siding and the factors listed below:
a. The maximum amount that may be paid for a single Property under the terms of this Agreement shall be measured by the Compensation Formula as applied to the surface area of the Siding. If a Siding piece is Damaged, the Compensation Formula will apply to the entire piece. If more than 50% of an outside wall section (floor, story, or face of that section) of a structure has compensable Damage, then this entire wall section will be compensated; that is, the Compensation Formula will be applied to the entire wall section. Masonite will have the discretion to authorize payment for an entire wall section when there is less than 50% Damage if that would be more economical. When Eligible Claimants submit multiple Claims, Damage can be accumulated over time to reach the "above 50%" threshold. If an Eligible Claimant receives compensation for Damage and does not pay to make repairs, and then submits an additional Claim which requires that the entire wall section with the prior Damage be fully compensable under the Compensation Formula, then Masonite will receive an offset for the first payment. If 75% of the Siding square footage of the structure is compensable under the Compensation Formula, then the Compensation Formula will be applied to the amount of the Masonite Hardboard Siding on the entire Property.
b. As of the date of this Agreement, Masonite has discontinued the manufacture of the following Hardboard Siding products: Countryside®, Salem®, Surewood®, Colorcoat®, Millwood®, Colorlok Seadrift®, Timberridge®, Ruf-X 4"O/C Panel®, Sawtooth Panel®, and Channel Rustic Lap®, and only Ruf-X 4"O/C Panel® and Sawtooth Panel® have reasonable substitutes. If an Eligible Claimant has sustained Damage to more than 25% of an elevation (side) of a Property which contains one of the above products discontinued as of the date of this Agreement for which there are no reasonable substitutes, then the Compensation Formula will be applied to the entire Masonite Hardboard Siding on the Property. If, after the date of this Agreement, Masonite discontinues the manufacture of other hardboard siding products during the term of this Agreement and there are no reasonable substitutes, then Eligible Claimants with such discontinued products shall be entitled to payment as follows: (i) if 25% of any elevation (side of a structure) is Damaged, then the Eligible Claimant shall receive payment under the Compensation Formula for that entire elevation; or (ii) if 15% of the Siding on the entire Property is Damaged, then the Eligible Claimant shall receive payment under the Compensation Formula for that entire Property.
5.9 Masonite shall receive a reduction of any amounts due an Eligible Claimant to the extent of the Claimant's use, in years, prior to the filing of the Claim, or the submission of a warranty claim, whichever is earlier, as follows:
5.10 Based upon review of the Field Inspection and Evaluation Form completed by the Independent Inspector and on the other requirements of this Agreement, the Claims Administrator will determine the amount, if any, of the payment to be made and will notify the Claimant of this amount. In conjunction with such notice, the Claims Administrator will forward to the Eligible Claimant a Release (Exhibit "E"). Upon receipt of an executed Release and a letter from the Claimant representing that the Property into which the Masonite Hardboard Siding has been installed and incorporated has not been sold by that Claimant, the Claims Administrator will forward to the Eligible Claimant a check, and a Notice of Individual Settlement.
5.10.1 If a Claimant is dissatisfied with the Inspector's payment calculation, he or she can request a second inspection. The second Inspector will be unaware of the details of the first inspection. The Claimant will receive the higher of the two damage calculations. If the second payment calculation is lower than the first, the cost of the second inspection (not to exceed $100) will be deducted from the Claimant's payment. If the payment amount calculated after the first inspection is $100 or less the Claimant will deposit with the Claims Administrator the difference between $100 and the first inspection amount before the second inspection occurs.
5.10.2 Each Class Member shall advise any subsequent purchaser of the Property from him or her of the settlement or shall record the Notice of Individual Settlement in the title records of the Property and make such other appropriate disclosure as may be required by local or state laws regarding the purchase and sale of property.
5.11 In the event an Eligible Claimant suffers subsequent Damage as a result of the Masonite Hardboard Siding that was not compensated by way of a prior Claim Form or Claim for Un-Reimbursed Expenditures, the Claimant may submit another Claim Form within the Claim Period of this Agreement and proceed through the Claim Program. A Claimant may make a Claim once every twelve-month period. After a Claimant has filed three Claims during the Term of this Agreement, the Claimant must pay in advance the cost of any additional inspections not to exceed $100 per inspection.
5.12 Class Members who were represented by attorneys other than Plaintiffs' Class Counsel and who resolved claims or lawsuits against Masonite through that representation are not "Eligible Claimants" with regard to any Masonite Hardboard Siding installed and incorporated into their Property at the time of any such claims. Purchasers of such Property will have no greater rights than their predecessors. Class Members who, without representation by an attorney, previously submitted or resolved a claim (the "Prior Claim") pursuant to any Masonite Hardboard Siding claim or warranty program (or signed a release of claims as part of such program), may participate under the terms of this Agreement to the extent that the Claimant:
Claimants must meet the above two requirements to the satisfaction of the Claims Administrator. Any amount due to such Claimant under this Agreement shall be reduced by the amount of any payment previously made by Defendants.
5.13 Class Members may assign their settlement benefits to the extent allowed by law, but only to subsequent purchasers of the affected Property. Any Claimant who is a subsequent purchaser of the Property with an assignment of claim determined by the Claims Administrator to be validly documented may file a Claim under the Compensation Formula, provided that such subsequent purchasers shall agree in writing to be bound by the terms and conditions of this Agreement and only to the extent such Damaged Siding has not previously been the subject of a claim filed by his or her predecessor. However, for any Damage not covered by the prior Claim filed by the predecessor, the subsequent purchaser with a valid assignment of claim may make Claims under this Agreement without regard to the Prior Claim or its resolution and may aggregate Claims with claims filed by predecessors to meet the" above 50%" threshold set forth in Section 5.8(a). Any dispute concerning the validity of any such assignment or payment made to such subsequent purchasers will be resolved by the Special Master to be appointed by the Court pursuant to Section 10.
5.14 The Claims Administrator shall process payment of Claims in the order of the Date of Claims received.
5.15 This Agreement applies to any Masonite Hardboard Siding manufactured after January 1, 1980 and installed prior to Final Order and Judgment in this Action.
5.16 Following the end of the Claims Period and the termination of the Claim Program established by this Agreement, Eligible Claimants will have the rest of any remaining applicable Masonite Hardboard Siding warranty period within which to file any claims for damage. Such claims will be considered to the extent that the applicable Masonite Hardboard Siding warranty period has not expired. The time period prescribed in any such Masonite warranties continues to run during the Claim Period established by this Agreement. Class Members agree that any claims for Damaged Masonite Hardboard Siding compensable under this Agreement which are made after the termination of the Claim Program established by this Agreement will be resolved exclusively through the applicable Masonite Hardboard Siding warranty program and Class Members agree to be limited in their recovery to the amounts contemplated by the Masonite Hardboard Siding warranty in effect at the time of the installation and incorporation of the Siding into their Property, to the extent that the warranty applies.
5.17 In no event shall Defendants, any attorneys representing Defendants, Plaintiffs or Plaintiffs' Class Counsel have any liability for claims of wrongful or negligent conduct by the Claims Administrator, Independent Inspectors, R.S. Means Company or their respective agents or employees.
6. SELECTION AND TRAINING OF INDEPENDENT INSPECTORS
6.1 The Independent Inspection firm will be selected following a competitive bidding process, although the lowest bidder need not be selected. Defendants will have the right to make such selection, subject to approval by the Court. Each Independent Inspector will be required to attend a training course presented and developed by Plaintiffs' Class Counsel and Defendants and/or their representatives. Plaintiffs' Class Counsel and Defendants will jointly train the Inspectors. The content of the course will be agreed to by the Plaintiffs' Class Counsel and Defendants and updated as required by experience. Any disputes as to the content of the training program will be resolved by the Special Master to be appointed by the Court pursuant to Section 10. The Independent Inspector firm shall have the right to hire and fire Inspectors subject to the provisions of Section 6.4.
6.2 Plaintiffs' Class Counsel and Defendants, upon agreement, shall have the right to supplement the list of Independent Inspectors and substitute or add others with the consent of opposing counsel, which consent shall not be unreasonably withheld.
6.3 During the Term of this Agreement, Plaintiffs' Class Counsel and Defendants shall have the right independently to audit any of the work of the Independent Inspectors and to test, on a sample basis, the findings of the Independent Inspectors.
6.4 In the event either Plaintiffs' Class Counsel or Defendants reasonably believes that any of the Independent Inspectors is not properly applying any of the terms of this Agreement, or in the event there is a question concerning the application of the terms of this Agreement by the Independent Inspectors, then:
a. The objecting Party's counsel shall notify counsel for the other Parties to this Agreement in writing of the concern;
b. Plaintiffs' Class Counsel and counsel for Defendants shall meet within 30 days of receipt of the written notification to resolve the concern;
c. In the event that Plaintiffs' Class Counsel and Defendants' counsel cannot resolve the matter, then the matter shall be submitted to the Special Master, whose ruling shall be final and not appealable;
6.5 Plaintiffs' Class Counsel and Defendant's counsel shall meet in person or by telephone conference regularly to discuss the implementation and execution of this Agreement and to attempt to resolve any concerns of the Parties.
7. NOTICE OF PROPOSED CLASS ACTION SETTLEMENT
7.1 As the Court may direct, the Parties shall cause the Notice of Proposed Class Action Settlement describing this proposed Settlement Agreement and the Fairness Hearing to be provided to the members of the Class as provided in this Section.
7.2 The Notice, in a form similar to attached Exhibit "C," and approved by the Court, shall be mailed, first class postage prepaid, to each member of the Class identified by the Parties through reasonable efforts. In addition, such mailing shall be sent to each member of the Class whose identity becomes known as a result of the Notice of Proposed Class Action Settlement being published, and other subsequent mailings will be made as the identities or addresses of additional Class Members become known. The Notice shall be made available for distribution and publication in Spanish as well as English where appropriate or upon request.
7.3 The Notice of Proposed Class Action Settlement shall be distributed to all known Class Members, including, without limitation, those having made Prior Claims. Masonite will submit for Court approval a letter to its customers describing the Settlement Agreement. The notice program to be submitted for Court approval shall include a short form of Notice of Proposed Class Action Settlement to be published initially in newspapers, and magazines, and broadcast on television in a manner reasonably calculated to reach members of the Class, as more particularly described in the Notice plan to be approved by the Court. The short form of the Notice of Proposed Class Action Settlement shall inform the reader, and/or listener or viewer, as the case may be, of a toll-free telephone number or numbers through which he or she may arrange for a mailing of the long form of the Notice of Proposed Class Action Settlement, Claim Form, or Claim for Un-Reimbursed Expenditures (Exhibits C, B, and A, respectively).
7.4 No later than the first dissemination of the Notice of Proposed Class Action Settlement, the Claims Administrator shall cause a nationwide toll-free telephone facility to be established. This facility shall be capable of (a) receiving requests for the long form of the Notice of Proposed Class Action Settlement and other materials described in this Section; (b) providing generalized information concerning deadlines for opt-outs, proofs of claim, and presentations to the Court at the Fairness Hearing; and (c) mailing the materials to Class Members as provided in this Section. The facility may, as appropriate under instructions from Plaintiffs' Class Counsel, refer individual inquiries to Plaintiffs' Class Counsel for response. The facility shall maintain records of all mailings and such other information in such form and in such manner as Plaintiffs' Class Counsel and Defendants jointly direct.
7.5 The Notice of Proposed Class Action Settlement, in a form agreed by the Parties, or in the event of no agreement, as decided by the Court-appointed mediators (Judges Fannin and Etheridge), shall be disseminated throughout the term of this Agreement as Plaintiffs' Class Counsel and/or the Claims Administrator identify additional Class Members.
8. CLASS MEMBERS' RIGHT OF EXCLUSION/INCLUSION
8.1. A Class Member may opt out of the Class during the Opt-Out Period. To exercise the opt-out right set forth in this Section, the Class Member must complete, sign, and return a request for exclusion. The request must be signed by the Class Member and notarized and must state the address of the Class Member's Property(ies) which contain Masonite Hardboard Siding and the number of units of residential Property or commercial structures containing the Siding. Such request must be postmarked on or before the end of the Opt-Out Period, which shall be 60 days from the date of the Order of Notice of Proposed Class Action Settlement.
8.1.1 Except for those Class Members who have properly opted out, all Class Members will be deemed Class Members for all purposes under this Agreement. Any Class Member who elects to opt out of the Class pursuant to this Section shall not be entitled to relief under or be affected by this Agreement.
8.1.2 Former Class Members who previously elected to opt out of the Class may withdraw their opt-out requests only if they accept the benefits and terms of this Agreement, do not object to this Agreement, and dismiss with prejudice any other pending action against any of the Defendants, arising from damage to Class Members' homes or other structures because of any defects or alleged defects in Masonite Hardboard Siding.
8.2 In the event that the number of Class Members requesting exclusion reaches a level that threatens to frustrate the essential purpose of this Agreement, Defendants may elect to terminate this Agreement by so notifying Plaintiffs' Class Counsel and the Court, not less than ten (10) days prior to the date set for the Fairness Hearing. The number of timely and valid opt outs at which this election arises has been agreed by the Parties, shall be submitted to the Court under seal, and shall remain confidential. Plaintiffs' Class Counsel shall have the right to challenge the timeliness and validity of any exclusion request, as well as the right to effectuate the withdrawal of any exclusion filed in error and any exclusion which a present or former Class Member wishes to withdraw for purposes of participating in the settlement as set forth in this Agreement. The Court shall determine whether any of the contested opt outs is valid.
9. CLAIMS ADMINISTRATOR
9.1 The Claims Administrator will be selected following a competitive bidding process, although the lowest bidder need not be selected. Defendants shall have the right to make such selection subject to approval by the Court.
9.2 The Claims Administrator shall, under the supervision of the Court, administer the relief provided by this Settlement Agreement in accordance with the terms of this Agreement and shall resolve Claims in a rational, responsive, cost effective, and timely manner. The Claims Administrator shall maintain the records of its activities in computerized database form and shall provide such periodic and special reports and such other information as the Court, Plaintiffs' Class Counsel, or Defendants may request. Plaintiffs' Class Counsel and Defendants shall also have the right to independently audit any work of the Claims Administrator.
9.3 In the event either Plaintiffs' Class Counsel or Defendants reasonably believe that the Claims Administrator is not properly applying any of the terms of this Agreement or in the event there is a question concerning the application of the terms of this Agreement by the Claims Administrator, then:
a. The objecting Party's counsel shall notify counsel for the other Parties to this Agreement in writing of the concern;
b. Plaintiffs' Class Counsel and counsel for Defendants shall meet within 30 days of receipt of the written notification to resolve the concern;
c. In the event that Plaintiffs' Class Counsel and counsel for Defendants cannot resolve the matter, then the matter shall be submitted to the Special Master, whose ruling shall be final and not appealable;
9.3.1 Plaintiffs' Class Counsel and counsel for Defendants shall meet in person or by telephone conference regularly to discuss the implementation and execution of this Agreement and to attempt to resolve any concerns of the Parties.
10. SPECIAL MASTER
10.1 The Parties shall jointly propose a Special Master to be appointed by the Court, to preside over implementation of the Settlement Agreement. The Special Master shall have power to make decisions in all matters pertaining to administration and enforcement of the Settlement Agreement, subject to review by the Court upon request of any Party. The Parties will use their best efforts to agree on the Special Master to be proposed to the Court. In the event that the Parties are unable to agree, the Court shall appoint the Special Master.
11. STATUTES OF LIMITATIONS OR REPOSE
11.1 A Class Member shall not be barred from obtaining compensation in accordance with the terms of this Agreement because of a statute of limitations or repose or due to the execution of a prior release, except as provided in Section 1.17 (Eligible Claimant) above.
12. EXCLUSIVE REMEDY; DISMISSAL OF ACTION; JURISDICTION OF COURT
12.1 This Agreement shall be the sole and exclusive remedy for any and all Settled Claims of Class Members against Defendants arising from the installation and incorporation of Masonite Hardboard Siding, and upon entry of the Final Order and Judgment by the Court, each Class Member who has not opted out of the Class, shall be barred from initiating, asserting, or prosecuting any Settled Claims against Defendants. In the event that any Class Member attempts to prosecute an action in contravention of the Judgment and Settlement Agreement in this Action, Plaintiffs' Counsel shall forward the Settlement Agreement to such Class Members and advise them of the Release provided pursuant thereto, and as necessary shall otherwise assist Defendants in ensuring that the Judgment in this Action is given full faith and credit.
12.2 On the Settlement Date, the Complaint in this Action shall be dismissed subject to the reactivation of claims as provided in Section 17 of this Agreement. Except as provided in Section 17 of this Agreement (reinstatement of Action and reactivation of claims), Class Members may not commence or actively prosecute actions on Settled Claims against any Defendant once the Final Order and Judgment is entered.
Class Members agree to the dismissal of any action pending against any of the Defendants to the extent any such action seeks recovery for any Settled Claims.
12.4 The Court shall retain exclusive and continuing jurisdiction of the Action, all Parties and Class Members, to interpret and enforce the terms, conditions, and obligations of this Agreement.
13.1 Upon entry of the Final Order and Judgment, and subject to Section 12 of this Agreement, each Class Member who has not timely opted out of the Settlement Class, on behalf of himself and any Person claiming by or through him as his heir, administrator, devisee, predecessor, successor, representative of any kind, shareholder, partner, director, owner or co-tenant of any kind, affiliate, subrogee, assignee, or insurer (the "Releasing Parties"), and regardless of whether any Class Member executes and delivers a written release, shall be deemed to and does hereby release and forever discharge Masonite and International Paper, including their successors, parents, subsidiaries, divisions, departments, or affiliates, and any and all of its past, present and future officers, directors, stockholders, partners, agents, servants, successors, subrogees and assigns and their respective insurers ("Releasees"), of and from any and all Settled Claims and related subrogation claims of the Releasing Party's subrogees or insurance carriers not protected from waiver of subrogation by the provisions of applicable insurance policies (or assigned or subrogated prior to final approval of this Agreement and not subject to compromise or settlement by the policyholder) except as provided herein. Each Releasing Party, upon entry of the Final Order and Judgment, and subject to Section 12 of this Agreement, shall be deemed to and does hereby release and discharge each Release of and from any and all Settled Claims. The Releasing Parties shall be deemed to and do hereby release and forever discharge any other
persons or entities from claims for which Defendants could be liable to any Releasing Parties, arising out of or based solely on the design, manufacture, advertising, sale, or distribution of the Masonite Hardboard Siding. Releasing Parties specifically reserve any and all other claims and causes of action against any and all other persons or entities not Parties to this Agreement.
13.2 Nothing in this Agreement shall prejudice or in any way interfere with the rights of the Class Members and the Defendants to pursue all their rights and remedies against any persons or entities not a party except as released in this Section.
13.3 Nothing in this Agreement shall be construed to affect in any way, or require the forfeiture or compromise of any claims that may raise from Class Members' purchase of any Masonite Hardboard Siding after Final Order and Judgment in this Action.
13.4 Nothing in this Agreement shall be construed in any way to prejudice or interfere with Defendants' rights to pursue their rights under their insurance policies.
14. EXPENSES AND FEES ASSOCIATED WITH CLAIMS
14.1 All reasonable fees and expenses incurred by the Special Master, the Claims Administrator and the Independent Inspector in administering this Agreement, the cost of all Notices provided in this Agreement, and all costs of implementing and administering the Claims Program, shall be paid by Defendants. Defendants shall have the right to monitor, inspect and audit such fees, expenses and other costs. Any dispute concerning the validity of such fees, expenses and any other costs incurred by the Claims Administrator or Independent Inspector shall be resolved by the Special Master.
14.2 If the Court does not issue the Final Order and Judgment, Defendants shall bear, in accordance with the terms of this Agreement, the costs of the Notice of Proposed Class Action Settlement and any expenses associated with this Settlement incurred to such point by a Special Master, Claims Administrator, Independent Inspector or R.S. Means Company, and any associated shutdown expenses, including any notices as the Court may direct, excluding attorneys' fees, and Defendants shall not have the right to recoup such funds.
15. ENFORCEMENT OF AGREEMENT
15.1 In the event Defendants fail to perform under the Agreement or to make a payment due and owing under the terms of this Agreement, Plaintiffs' Class Counsel shall so notify the Court. Defendants shall then be given written notice of the breach. If a breach is not cured under this Agreement, Plaintiffs' Class Counsel shall apply to the Court for relief.
15.2 In the event of a breach by Class Members or Defendants under this Agreement, the Court may exercise all equitable powers over the breaching Party(ies) to enforce this Agreement and the Final Order and Judgment irrespective of the availability or adequacy of any remedy at law. Such powers include, among others, the power of specific performance and injunctive relief.
16. REPRESENTATIONS AND WARRANTIES
16.1 Defendants represent and warrant that (i) they have all requisite corporate power and authority to execute, deliver, and perform this Agreement and to consummate the transactions contemplated hereby, (ii) the execution, delivery, and performance of this Agreement and the consummation by it of the actions contemplated herein have been duly authorized by all necessary corporate action on the part of Defendants; and (iii) this Agreement has been duly and validly executed and delivered by Defendants and constitutes their legal, valid and binding obligation.
17. TERMINATION OF THE AGREEMENT
17.1 The performance of this Agreement is expressly contingent upon entry of the Final Order and Judgment. If the Court fails to issue such Order and Judgment approving this Agreement following conclusion of the Fairness Hearing(s), the Agreement will be terminated, having no force or effect whatsoever, null and void, ab initio, and not admissible as evidence for any purpose in any pending or future litigation (in any jurisdiction) involving any of the Parties. Defendants will use commercially reasonable efforts to implement the Claims Program in accordance with the terms and conditions of this Agreement as soon as practicable after the entry of Final Order and Judgment.
17.2 After seven (7) years from the Settlement Date, Defendants will have the option to terminate this Agreement. In the event Defendants elect to terminate the Agreement under this Section of this Agreement, this Action will be reinstated and the claims of Class Members having Claims falling within the Claims Period prescribed by Section 1.8 shall be reactivated just as they were at the time of settlement to the extent stated in this Section. Class Members who would still be eligible for relief under this Agreement would then be able to pursue, notwithstanding any other provision in this Agreement or the Final Order and Judgment to the contrary, Settled Claims that have not been paid and released pursuant to this Agreement and any associated new claims against Defendants and the statute of limitations and/or repose for all those claims shall be deemed to have been tolled from December 8, 1994, until the date of reinstatement and reactivation or for such longer period as the law may provide without reference to this Agreement.
17.3 Notwithstanding any other provision of this Agreement, if this Agreement is terminated for any reason, Masonite and International Paper hereby stipulate and agree that, to the extent legally permissible, the Plaintiffs may pursue their claims by proceeding with the certified class action and the appropriateness of the Plaintiffs to act as representative Plaintiffs shall be based on their status as of the date of Preliminary Approval, even if one or more of the Plaintiffs' individual claims will thereafter have been paid under this Agreement
17.4 Until the Term of this Agreement has expired, Defendants agree to use their best efforts to preserve all records and evidence which are or could be relevant to, or could lead to the discovery of relevant evidence, concerning the research and development of Masonite Hardboard Siding, its marketing, distribution, and manufacture, and the operation of its Hardboard Siding warranty claims process.
18. MISCELLANEOUS PROVISIONS
18.1 Subject to Court approval, Defendants shall pay, separately and apart from the Settlement Amount, to each Class Representative within ten days of the Settlement Date one payment of $10,000, not to exceed the sum of $30,000, owned by them into which Masonite Hardboard Siding is or was incorporated and installed in recognition of their efforts on behalf of the Class.
18.2 This Agreement, including all attached Exhibits hereto, shall constitute the entire Agreement among the Parties with regard to the subject matter of this Agreement and shall supersede any previous agreements and understandings between the Parties. This Agreement may not be changed, modified, or amended except in writing signed by Plaintiffs' Class Counsel and Defendants' and subject to Court approval. The Parties contemplate that, except for Exhibit C, the exhibits may be modified by subsequent agreement of Masonite, International Paper Company and Plaintiffs' Class Counsel prior to dissemination to the Class Members.
18.3 This Agreement may be executed by the Parties in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
18.4 This Agreement shall be binding upon and inure to the benefit of the Class, the Parties, and their representatives, heirs, successors, and assigns.
18.5 The headings of the sections of this Agreement are included for convenience only and shall not be deemed to constitute part of this Agreement or to affect its construction. The decimal numbering of provisions herein is intended to designate subsections where applicable.
18.6 Any notice, instruction, application for Court approval or application for Court order sought in connection with this Agreement or other document to be given by any Party to any other Party shall be in writing and delivered personally or sent by registered or certified mail, postage prepaid, if to Masonite or International Paper, to the attention of Masonite's and International Paper's respective representatives and to Plaintiffs' Class Counsel on behalf of Class members, or to other recipients as the Court may specify. As of the date of this Agreement, the respective representatives are as follows:
For Masonite: _____________________:
For International Paper Company: ____________________:
For the Plaintiff Class: Richard Dorman.
Dated this ___ day of September, 1997.
Masonite Corporation International Paper Company
Counsel for Defendant Masonite Corporation
Counsel for Defendant International Paper Company
Stephen M. Bickford
Robert H. Shulman
PLAINTIFFS' CLASS COUNSEL:
Richard T. Dorman
Elizabeth J. Cabraser
Michael F. Ram
John T. Crowder, Jr.
NOTE: Masonite® is a registered trademark of Masonite Corporation.