$107.5 million settlement reached over wood-sealant damage

Thousands of Western Washington homeowners who put a popular brand of wood sealant on their homes, decks and fences — only to find out the products caused mildew instead of preventing it — will likely receive the most compensation from a $107.5 million settlement this week of a nationwide class-action lawsuit.

Masco, the Michigan company that manufactures Behr brand wood coating, agreed to pay damages or award merchandise certificates to tens of thousands of homeowners nationally who used certain Behr products.

In addition, some 5,000 Western Washington homeowners, part of the original suit that grew into the national class-action suit, will share in an extra pot of about $55 million to fix their mildew-damaged homes.

"We think it's a great settlement; Masco did the right thing here," said Mike Withey, a partner in the Seattle law firm Strittmatter, Kessler, Whelan, Withey and Coluccio, which began the suit as a small action in Grays Harbor County four years ago.

The settlement, in which Masco doesn't admit wrongdoing, received preliminary approval in a California court Tuesday.

Homeowners who used the sealant would begin to receive their varying levels of compensation by September, Withey said.

Masco, which also makes Delta faucets and other home products, declined comment, except to issue a statement that says it expects that all claims related to the Behr products are settled. The company also announced it still expects to post third-quarter profit of about 44 cents a share.

The company's stock rose 3.5 percent, to $19.92, on the New York Stock Exchange Tuesday afternoon, immediately after the settlement was announced. The stock rose another 2.66 percent yesterday, closing at $20.43. It had sold for as high as $29.44 in May. The stock bottomed out three weeks ago at a yearly low of $17.17.

Payouts from the lawsuit will range from a few hundred dollars for homeowners who only used a little bit of the treatment on small decks or fences, to many thousands of dollars for some Western Washington homeowners who covered their entire houses with it, Withey said.

At issue are two Behr products, Super Liquid Raw-Hide and Natural Seal Plus, both sold most widely through Home Depot stores.

Behr sold more of those products in Western Washington than in any other state, Withey said. And users here typically had the most damage because they used more of the stain to protect their homes from the damp, mildew-prone climate.

In 1998, nine home and business owners in Grays Harbor County sued Behr alleging that the company had falsely advertised the wood sealants as mildew resistant, even though the company knew they contained large amounts of linseed oil, which feeds mildew. The plaintiffs said they applied the Behr products only to watch their buildings turn black with mildew.

In 2000, a Grays Harbor jury ruled against Behr and a judge also allowed the suit to apply to anyone in Western Washington with damage from the stains.

Last month, a state appeals court upheld the ruling in the Western Washington case and allowed punitive damages against Behr. The company's stock price dropped 16 percent after the ruling.

The settlement only applies to the two Behr products — Super Liquid Raw-Hide (product numbers 12, 13, 31-12 and 31-13) and Natural Seal Plus (numbers 79, 80, 81, 82, 83, 84, 92, 31-79, 31-80, 31-81, 31-82, 31-83, 31-84, 31-92) — sold since Jan. 1, 1991.

The amount of money or free merchandise each homeowner will get from the company will be calculated based on which product was used, how much of it, the size of the area that was treated and how much damage was done, Withey said.

To join in the settlement, homeowners should call a hotline, 877-637-5997, or look online at www.behrsettlement.com and print out a claim form.