Polychlorinated Biphenyls (PCBs)… Asbestos… Hexavalent Chromium… Trichloroethylene (TCE). All of these substances raise the suspicion (and challenge the vocabulary) of the reader, suggest toxicity and health concerns, and are commonly associated with significant tort and environmental liability. However, none of these substances is what some legal experts are calling the next area of massive toxic tort litigation and liability. Rather, it is mold, the relatively innocuous-sounding inhabitant of many a bachelor’s refrigerator, that is generating nationwide media attention and involving homeowners, architects, construction companies, commercial and residential landlords, property managers, employers and contractors in multimillion dollar lawsuits. The following is a brief introduction to the strange new world of toxic mold litigation.

THE SCIENCE, OR LACK THEREOF, OF MOLD LITIGATION: A BATTLE OF THE EXPERTS

In the last few years, an increasing number of claims alleging personal injury and property damage resulting from mold infestation and exposure have been brought by property owners, employees, tenants, building occupants, and local governments. These claims have garnered significant publicity, resulted in surprising verdicts, and caused reactions by impacted industries. Despite the recent rash of mold-related litigation, the science regarding whether certain species of mold can cause significant and permanent health effects remains unclear.

Molds are a type of fungi and are ubiquitous in the environment. Molds require moisture to survive. However, unlike most other plants, molds lack chlorophyll and thus they grow on other materials. Outdoors, molds are an integral part of natural processes, breaking down leaves, wood and plant debris. However, indoors, mold spores grow by digesting whatever organic substance they land on, including wallpaper, insulation, drywall, carpet, ceilings and roofs. Scientists have identified over 5,000 species of mold, of which around 150 can cause allergies in humans, approximately 50 are pathogenic (i.e., they can grow inside the human body), and about 50 are capable of creating “mycotoxins,” fungal metabolites which may cause toxic reactions in healthy individuals.

Plaintiffs in mold litigation have alleged that molds cause a variety of different illnesses and adverse health effects: from the more mundane and generic headaches, nausea, fatigue, asthma, hay fever-like symptoms (runny nose and scratchy throat) and respiratory problems, to exotic disorders with accompanying acronyms, such as sick building syndrome (SBS), fibromyalgia (FM), chronic fatigue syndrome (CFS), reactive airway dysfunction syndrome (RADS), toxic encephalopathy (TE), and multiple chemical sensitivity (MCS).¹

Although it is generally accepted in the scientific community that certain mold species can cause allergic reactions in individuals such as coughing, sneezing and breathing problems, there is a lack of scientific consensus regarding (1) whether mold can cause permanent and severe illnesses, and (2) what level of mold exposure may cause such illnesses (or conversely, what is a permissible exposure level (PEL) to indoor mold). The U.S. Centers for Disease Control and Prevention (CDC) reviewed an investigation of pulmonary illnesses in infants in Cleveland, Ohio, in 1994, and initially agreed with the investigators’ conclusion that inhalation of Stachybotrys chartarum spores caused the children to die from pulmonary hemorrhage.² However, the CDC later criticized the unscientific sampling and unjustifiable assumptions of the investigators, and now states on the CDC Web site that “[t]here are very few case reports that toxic molds (those containing certain mycotoxins) inside homes can cause unique or rare health conditions such as pulmonary hemorrhage or memory loss. These case reports are rare, and a causal link between the presence of the toxic mold and these conditions has not been proven.”³

RECENT CASES AND INDUSTRY REACTIONS

• In May 2002, mold testing in a South Atlanta apartment complex showed “a serious mold problem” in at least 37 of the 119 rent-subsidized units, causing dozens of families to vacate their apartments and subjecting the property manager and complex owners to numerous claims from residents relating to the mold growth;⁴
• In June 2001, a jury awarded $32 million to a Texas family after the jury concluded that the defendant insurance company’s failure to properly cover repairs for water damage allowed the “toxic mold” Stachybotrys atra to grow in the family’s 22-room mansion;⁵
• In May 2001, the Delaware Supreme Court upheld a $1 million verdict (reduced by 22% for contributory negligence) in favor of two tenants of an apartment complex who claimed that mold growth in their apartments resulting from water leakage had caused respiratory problems and cognitive impairments. In addition, the Delaware Supreme Court rejected the landlord’s contention that the testimony of the tenants’ expert witnesses should be excluded as scientifically unreliable;⁶
• In 1998, the Florida Court of Appeals affirmed an over $14 million verdict in favor of Martin County and against the construction manager of a county courthouse based on the growth of “toxigenic” molds, water damage, and indoor air quality problems resulting from construction defects in the courthouse;⁷
• One California lawyer says he has more than 1,000 mold-related lawsuits in development; many of which involve claims by condominium residents that they suffered illnesses because their homeowners’ associations failed to properly maintain the common areas of their properties;⁸
• Recently, insurance companies in some of the states hardest hit by toxic mold litigation and mold-related insurance claims, such as Texas and California, announced moratoriums on the sale of policies that would cover mold and excluded coverage for mold and water damage in homeowners’ policies;⁹
• Many residential real estate companies have begun recommending to their agents and clients that they obtain a mold inspection, along with the customary general home inspection, before purchasing a home.

Although a bill is expected to be introduced in the United States Congress that would require the Environmental Protection Agency (EPA) to create guidelines establishing “what levels of toxic mold are acceptable, and what levels are dangerous,”¹⁰ currently there are no government or industry standards that specify allowable or acceptable levels of indoor, airborne fungi.[^5] In addition, there is little published information comparing indoor and outdoor fungal populations or comparing fungal populations in different parts of the United States, and only limited available information on the prevalence of certain fungal types in buildings.¹¹

Given this scientific uncertainty, the outcome of toxic mold litigation frequently hinges on expert witness testimony and the ability of the plaintiff to establish causation between his or her alleged injuries and the particular species of mold. In order to establish causation, the plaintiff must prove both “general causation,” that the particular species of mold is capable of causing the plaintiff’s specific injury, and “specific causation,” that the plaintiff was in fact exposed to a dose of the alleged toxic mold sufficient to cause the plaintiff’s injury.¹²

In order to attempt to satisfy these causation thresholds, a plaintiff will frequently utilize an environmental testing firm or laboratory to conduct mold sampling in the allegedly contaminated structure and will engage expert witnesses in fields such as mycology (the study of fungi), microbiology, environmental and occupational medicine, allergy and immunology, neuropsychology, industrial hygiene, architecture and building design, and building maintenance. The focus of the defense is on convincing the Court to exclude the plaintiff’s proposed “expert” testimony as scientifically unreliable, which is a real possibility in light of the lack of scientific consensus regarding mold toxicity and the questionable methodology utilized by many environmental sampling firms. If the defense fails in its efforts to exclude the plaintiffs’ experts, mold lawsuits frequently are resolved via the jury’s determination of which side’s experts “win” the “battle of the experts” at trial.

HOW DOES MOLD ARRIVE INDOORS AND WHAT CAN BE DONE ABOUT IT?

Molds require moisture to survive, and thus they grow in damp or wet areas indoors. When excessive moisture is present in a building or home, and the moisture problem is undiscovered or not addressed, mold growth is a real threat because molds flourish on wet building materials. Common areas for indoor mold growth include bathroom tile, basement walls, areas around windows where moisture condenses, and near leaky water fountains or sinks. Common sources or causes of water or moisture problems, and the resultant mold growth, include roof leaks, delays in proper building maintenance, condensation from heating, ventilation, and air conditioning systems, condensation associated with high humidity or cold spots in a building, flooding from plumbing failures or heavy rains, slow leaks in plumbing fixtures and pipes, and the malfunction of humidification systems. Moreover, mold infestation is an increasingly problematic issue in newer buildings and homes because more recently constructed buildings and homes are much tighter and more energy efficient, and occupants rarely open windows, resulting in less ventilation of the indoor environment.

The growing awareness of mold growth and indoor air problems has spawned an industry specializing in mold testing and remediation of commercial and residential buildings. Until recently, there was little guidance and no standards governing mold remediation, and thus some unscrupulous testing and remediation companies charged exorbitant amounts for, and engaged in extensive cleanups of, relatively minor mold problems. However, in March 2001, the EPA issued a guidance document for mold remediation projects that provides some general guidelines for evaluating and responding to an indoor mold problem.14 In addition, the EPA guidance lists a number of measures to prevent indoor mold growth which, although generally common sense, are helpful for building owners and homeowners:

The key to mold control is moisture control;
– Fix leaky plumbing and leaks from outside the building as soon as possible;
– Watch for condensation and wet spots;
– To reduce the moisture level in indoor air, increase ventilation (if outside air is cold and dry), or use a dehumidifier (if outside air is warm and humid);
– Keep heating, air-conditioning and ventilation (HVAC) drip pans clean, flowing properly, and unobstructed;
– Perform regular HVAC system inspection and maintenance (do not run HVAC system if you suspect that the HVAC system is contaminated with mold);
– Do not allow building foundations to remain wet. Provide drainage and slope the ground away from the foundation; and
– Remove and replace any flooded carpets.

There is little question that, at least for the short-term future, toxic mold litigation and insurance claims will continue to grow, generate significant publicity, and trigger legislative and regulatory responses from government. Although individuals and companies facing indoor mold issues and/or mold-related claims should not overreact, it is important to take such issues seriously and respond in a timely manner by consulting an experienced environmental remediation firm and seeking legal advice if necessary.

ENDNOTES