Fighting the Myth of “Toxic Mold”

For the past several years, the real estate and construction industries have been rocked by “toxic mold” litigation.  No sector of these industries is safe from the attack being mounted by the plaintiff’s bar.  Targeted defendants include property owners, developers, contractors, material suppliers, property managers, schools, municipalities, real estate agents, insurers and employers.  The industry is even turning on itself! The latest victims of the planned aggression are the indoor air quality professionals and remediation contractors that the antagonists retained to develop and implement plans to “fix” the so- called “contaminated” buildings during the first wave of litigation.

How did this area of litigation grow so rapidly?  Two myths support the ever-expanding wave of litigation; that plaintiffs have been getting rich pursuing “mold” claims; and that exposure to mold causes serious injury.  These myths lead to increased media exposure, which in turn, leads to more (and more obdurate) plaintiffs.  The vicious circle continues, funded by the industry “experts” that reap the rewards of the battle.  The underlying premises, however, are not supported by the data and reliable evidence.  After debunking the myths, we recommend some simple steps that any company can take to minimize their exposure to this industry.

The myth that Plaintiff’s are getting rich.  Despite media attention, plaintiffs are not getting rich in large numbers pursing mold claims.  We have all heard about the Ballard case in Texas, where a jury awarded a homeowner 32 million dollars against her homeowner’s insurance company (an award that did not include damages for bodily injury and that was reduced to about $4,000,000 on appeal – often omitted facts) and Ed McMahon claiming that “toxic mold” killed his dog (it was later determined that the dog had been put to sleep before the flood which Mr. McMahon asserted was responsible for contaminating his home).  However, those keeping score of the national trend report very few “big hits.”  Of 31 verdicts reported nationally where plaintiffs claimed bodily injury from exposure to mold in indoor environments, 17 have been defense verdicts.  While 14 cases have resulted in verdicts for a plaintiff, only four exceeded the million dollar mark.  Despite the perception of many, plaintiffs are not routinely getting multi-million dollar verdicts.

The myth that exposure to mold causes serious injury.  It has been reported that mold and fungi make up more than twenty percent of the earth’s biomass.  Every person is exposed to airborne mold spores everyday.  Yet, one reading newspapers would get the impression that risks associated with common molds and nuclear waste is identical.  In an effort to address this misconception, in 2003, the National Association of Home Builders commissioned a review of available scientific literature.  The commissioned panel included well credentialed experts from the fields of mycology, industrial hygiene, immunology and toxicology.  The panel concluded that while evidence exists to support an association between exposure to indoor dampness and the occurrence or exacerbation of asthma or upper respiratory infections, there is insufficient evidence to support a causal relationship between exposure to mold in the indoor environment and any systemic disease or neurological illness.  This study was largely ignored by the media and the plaintiff’s bar, either because they found the results uninteresting or discounted same as industry biased.  However, in May 2004, the Institute of Medicine, an organization affiliated with the National Academy of Sciences, issued a report that reached the same conclusions.  The study concluded that exposure to excessive dampness and mold could cause upper respiratory problems in individuals sensitive to mold, but that no evidence existed to support claims of fatigue, neuropsychiatric disorders or similar serious disorders that some were claiming from exposure to mold in the indoor environment.  This report simply cannot be ignored by any responsible party.

How does a Company defend itself?  Whether the threat of mold is real or not, the public perceives a threat and acts accordingly.  How does a company minimize its exposure to this perceived risk?  Be prepared!  There are a number of steps a company can take to protect themselves.  First, educate those that interact with consumers to treat all complaints as real.  Nothing sends a consumer to a lawyer faster than feeling that they have been ignored or taken lightly.  Second, respond quickly.  Mold can grow within 24-48 hours of a water intrusion event.  Those responsible for maintaining property must have a water intrusion protocol that allows for a rapid response.  A lot of damage can be done while a maintenance worker waits for a call back from a manager with the appropriate knowledge.  Third, be careful of the professionals you hire.  If you retain indoor air quality experts to assist you in evaluating a problem, check credentials carefully.  A “Certified Industrial Hygienist” has a four year college degree in science, a minimum of 5 years industry experience and has passed a 16 hour test; while a “Certified Indoor Environmentalist” may have passed a 3-5 day internet course! Fourth, if you find yourself facing a lawsuit, use a lawyer with significant industry experience.  This area has become very specialized, mixing elements of construction defect and toxic tort litigation.  Your lawyer has to be able to read the blueprints for the building at issue and  relevant abstracts from the Journal of the American Medical Association. 

The “toxic mold” phenomenon will run its course as the plaintiff’s bar achieves increasingly disappointing results and reliable science discredits claims of serious personal injury.  In the meantime, every potential defendant must act to minimize their own exposure.