Masonite Omniwood

The purpose of this Notice is to inform you that your rights may be affected by the pro ceedings in the lawsuit known as Cosby v. Masonite , CV-98-2446, heard before the Honorable Robert G. Kendall, in the Circuit Court of Mobile County, Alabama. This Notice is given pursuant to Alabama Rule of Civil Procedure 23 and by order of the Circuit Court of Mobile County, Alabama.

2. What is the lawsuit about?

In 1997, Jeff Cosby and other homeowners filed a lawsuit called Cosby, et al. v. Masonite Corp., et al., No. CV98-2446. The Cosby Plaintiffs, who own structures with exterior Masonite OmniWood Siding, brought the case as a class action against defendants Masonite Corporation and International Paper Company (together, "Masonite" or "Defendants") on behalf of all individuals or entities owning property in the United States on which Masonite OmniWood Siding manufactured since 1992 is incorporated and installed.

Plaintiffs sought relief based on theories of negligence, breach of express warranties, and fraud. Plaintiffs allege that OmniWood siding manufactured by Masonite Corporation on or after January 1, 1992, and installed and incorporated into commercial and/or rental property and residences, will rot, buckle, discolor, deteriorate, and cause damage to other structural parts of the buildings into which it is incorporated, causing the Class Members to suffer and continue to suffer damages. Defendants vigorously deny these allegations and any and all liability for these claimed allegations. Defendants further deny that Class Members are generally entitled to damages or other relief from the Defendants.

On January 6, 1999, the Circuit Court of Mobile County, Alabama, approved a settlement of this matter, certifying this action as a class action, defining the Class as: all persons and entities owning property in the United States and its territories on which Masonite OmniWood Siding manufactured between January 1, 1992 and January 6, 1999 is incorporated and installed.

In this case and other litigation, counsel for the plaintiffs have conducted an extensive investigation of the claims concerning Masonite OmniWood siding. They have reviewed several hundred thousand documents and conducted depositions.

The parties have settled this class action. This Settlement is a compromise of disputed claims and is not to be taken as an indication of liability or that damages have been, or would be, found against Defendants if the action had proceeded to trial.

3. What is Masonite OmniWood Siding?

Masonite was a leading manufacturer of an oriented strandboard siding product made from wood fiber, wax, resins, and a hardboard overlay that is widely known as OmniWood Siding. Masonite OmniWood Siding was distributed both in lap (board) and panel (sheet) applications, each available in various external textures designed to look like conventional lumber siding. Masonite marketed OmniWood siding products for a variety of external construction uses, including exterior siding for residential and other structures.

4. Who is covered by the Settlement?

If you qualify as an Eligible Claimant, you may be entitled to recover under the Settlement Agreement. To be an Eligible Claimant, you must:

(1) own property in the United States or its territories in which Masonite OmniWood Siding has been incorporated and installed from January 1, 1992 to January 6, 1999, and have not assigned the claim regarding the alleged damage caused by Masonite OmniWood Siding;

or (2) be a subsequent purchaser of such property and have a valid assignment of Claim under the Settlement Agreement;

or (3) own or have formerly owned such property and have made Prior Un-Reimbursed Expenditures as defined by the Settlement Agreement.

Eligible Claimants do not include persons, associations or entities who made claims or filed lawsuits against Defendants other than in the Cosby class action, if they were represented by counsel other than Plaintiffs' Class Counsel in the Cosby class action, and their claims or lawsuits were resolved by payment, release, dismissal with prejudice, or judicial action.

5. How do I know if I have Masonite OmniWood Siding?

Masonite Corporation, prior to 1997, was a leading manufacturer of an oriented-strand board siding product made from wood fiber, wax, resins and a hardboard overlay that is widely known as OmniWood siding. Masonite distributed its OmniWood siding both in lap (board) and panel (sheet) applications, in various external textures designed to look like conventional lumber siding. Masonite marketed OmniWood siding products for a variety of external construction uses, including exterior siding for residential and other structures. This lawsuit does not concern Masonite^Ž products used for interior, roof, wall substrate, plywood or deck sheathing, or for purposes other than exterior siding. The lawsuit does not concern Masonite Hardboard Siding. The lawsuit also does not concern Masonite Woodruf^Ž roofing. If you are filing for Masonite Hardboard Siding, please call 1-800-330-2722, or Woodruf roofing, please call 1-800-256-6990, to obtain the appropriate claim form.

6. What are the terms of the Settlement?

On January 6, 1999, the Court approved the Settlement. The essential terms of the Settlement are:

a. Eligible Claimants

If you qualify as an Eligible Claimant, you may be entitled to recover under the Settlement Agreement. To be an Eligible Claimant, you must:

(1) own property in the United States or its territories in which Masonite OmniWood Siding manufactured since January 1, 1992 is incorporated and installed, and have not assigned the claim regarding the alleged damage caused by Masonite OmniWood Siding;

(2) be a subsequent purchaser of such property and have properly documented assignments determined to be valid under the Settlement Agreement; or

(3) own or have formerly owned such property and have made Prior Un-Reimbursed Expenditures as defined by the Settlement Agreement.

Eligible Claimants do not include persons, associations or entities who made claims or filed lawsuits against Defendants other than in the Cosby class action, were represented by counsel other than Plaintiffs' Class Counsel in the Cosby class action, and whose claims or lawsuits were resolved by payment, release, dismissal with prejudice, or judicial action.

b. Compensation Formula

(1) Basic Formula.

The Settlement Agreement contains a Compensation Formula, which will be the measure of payments to which an Eligible Claimant is entitled for the damage to a home or other structure. As agreed by the parties, the Compensation Formula will be based on (1) the average cost per square foot for siding replacement, including all material and labor as calculated by industry standards in your area, adjusted annually for inflation, or (2) the cost of appropriate refinishing as determined by industry standards in your area, also adjusted for inflation.

If more than 40% of a wall section is found to have compensable damage, then an Eligible Claimant will receive compensation, determined by the Compensation Formula, for that entire wall section. If 60% of the siding square footage of the structure qualifies as damaged, then an Eligible Claimant will receive compensation, as determined by the Compensation Formula, for the entire structure.

(2) Definition of Damage.

To be entitled to payment under the Settlement, an Eligible Claimant must be determined to have compensable Damage as defined by the Settlement Agreement. In summary terms, the Settlement Agreement defines Damage as follows: (1) thickness swell exceeding .520"; (2) edge checking wherein a gauge can be inserted one half inch into the board; (3) fungal degradation which results in soft board in which thumb pressure exhibits sponginess in the board deforming or producing significant indentation; (4) buckling exceeding of 1/4" between studs placed not more than 18" on center; (5) wax bleed; (6) delaminated or cracked primer or primer peel or peeling, or blistering; (7) surface welting, or swelling around nailheads; (8) moisture content exceeding 20%; or (9) raised or popped wafers visible on more than 25% of the surface of a board. Damage does not include: (1) intentional, reckless or negligent damage to siding (unrelated to installation or maintenance); or (2) damage to siding to the extent resulting from natural disaster including, but not limited to, fire, hurricane, flood, earthquake, earth movement or other similar events (excluding hail).

(3) Causation Exceptions.

An Eligible Claimant with compensable Damage as defined above will be entitled to recovery unless one or more of the Causation Exceptions contained in the Settlement Agreement is determined to apply. The Causation Exceptions include damage caused by: (1) framing misalignment; (2) studs spaced more than 18 inches on center; (3) missing nails or nails which do not appear to penetrate framing members; (4) permanently installed sprinkler systems having directly sprayed the affected area; (5) siding within two inches of the ground; (6) the absence of or improper roof/wall flashing or cutbacks; (7) the failure of a chimney cricket to extend to the edge of the chimney; or (8) damage around a window assembly.

For a Causation Exception to apply, the condition giving rise to the Exception must be clearly observable to the Independent Inspector without intrusive testing and must be determined to be the sole, independent cause of the damage. The benefit of any doubt will go to the homeowner. In addition, an Eligible Claimant will be compensated under the Compensation Formula for all damage to a particular board if any part of such damage is determined to be a result of product failure.

(4) Discontinued Masonite OmniWood Siding Products for Which There Are No Reasonable Substitutes.

As of the date of the Settlement Agreement (July 1998), Masonite has discontinued the manufacture of all OmniWood siding products. For certain products, specifically OmniWood Pine Textured 8" Lap, there are no substitutes that are reasonably similar in appearance. If an Eligible Claimant owns a structure with this discontinued product, and has sustained compensable damage to more than 25% of an elevation (side) of the structure, then the Eligible Claimant will be paid under the Compensation Formula for the entire structure.

(5) Limited Age Deduction.

The Settlement Agreement also provides for an age deduction based on the number of years the Masonite OmniWood Siding has been installed and incorporated into the structure. For the first five (5) years following installation, there is no deduction or proration under the compensation formula. For each year thereafter, there will be a deduction of three percent (3%) per year for use of the Masonite OmniWood Siding, up to a maximum deduction of twenty-seven percent (27%), based on the compensation formula.

c. Settlement Claims Program

(1) Claim Form and Procedures for Damage That Has Not Been Repaired and Product Identification.

To make a claim for damage that has not been repaired, a Class member must be an Eligible Claimant as defined above, and must submit a properly completed Claim Form to the Claims Administrator, along with proof of product identification. Proof of the existence of the Masonite OmniWood Siding on an Eligible Claimant's property may be achieved by: (1) providing the Claims Administrator with a 6" by 6" sample of Masonite OmniWood siding on the home or property certified by the Claimant to have been from the structure in question that includes the lower drip edge for lap siding or the vertical groove for panel siding; (2) a prior communication from Masonite that confirms that the siding in question is Masonite OmniWood Siding; (3) submitting a Claim Form with a check for $100.00 (one hundred dollars), which will be refunded if the Inspector determines the siding is Masonite OmniWood Siding; (4) an invoice or warranty, along with photographs of the exterior walls of the structure, showing that the siding is Masonite OmniWood Siding; or (5) a photograph depicting the back of the Masonite OmniWood siding and the Masonite OmniWood Siding stamp.

(2) Inspection and Payment of Claim.

After receipt of a properly completed Claim Form, an Independent Inspector will inspect the property to verify the amount, if any, of compensable Damage. All damage associated with siding that meets the agreed definitions of Damage shall be compensable unless it is subject to one of the Causation Exceptions identified above. After completion of the inspection, the Independent Inspector will forward his/her report to the Claims Administrator, who will determine the amount of payment based on the information contained in the report of the Independent Inspector, according to the Compensation Formula defined above as applied to the damage compensable under the Settlement Agreement.

(3) Claim for Un-Reimbursed Expenditures.

Eligible Claimants also are entitled to make claims for Un-Reimbursed Expenditures associated with Masonite OmniWood Siding if they made the repairs (i) before January 6, 1999 or, (ii) between the entry of final order and judgment, January 6, 1999, and April 1, 2000, if they did so in good faith and with no knowledge of the Settlement Agreement or Claims Program established by this Agreement. To make such a claim, the Eligible Claimant must properly complete a Claim for Un-Reimbursed Expenditures and must provide satisfactory proof (1) that the siding that is the subject of the claim was Masonite OmniWood Siding, (2) that the siding was damaged, (3) that the damage that is the subject of the claim was repaired or replaced, and (4) of the costs of any such repair or replacement work. In seeking to satisfy the first and second proof requirements, an Eligible Claimant may submit (i) photographs showing damaged Masonite OmniWood Siding, (ii) contracts, invoices, bills or other documents reflecting the repairs to the siding, or (iii) sworn statements from third persons in the business of inspecting or making repairs attesting to the inspection, damage and repairs. Claims may not be made for painting alone, but where the siding has been replaced, the cost of painting the siding may be included.

(4) Subsequent/Multiple Claims.

You are not limited to making a single claim during the life of the Settlement. If you experience additional compensable Damage subsequent to an initial claim that was not the subject of a previous claim, you may make additional claims in subsequent years during the life of the Settlement.

(5) Claims Periods and Deadlines.

The Settlement provides a ten (10) year claims program, subject to two provisions. The first would allow defendants to void the settlement after seven years; the second would permit defendants to extend the agreement for an additional ten (10) years. If the settlement extends for the first ten years, you must file your claim(s) by January 6, 2009. If the defendants exercise the early termination option, claims must be filed by January 6, 2006. If defendants exercise the option to extend the agreement an additional ten years, the settlement will terminate January 6, 2019. Once the Settlement expires, the remainder of Masonite's warranty, if any, will remain in effect, and you may be entitled to receive compensation for siding that fails under the terms of Masonite's warranty program separate and apart from this Settlement.

7. What if I have sold my house?

If you have sold your house, you are eligible to participate in the lawsuit if you previously repaired or replaced damage related to your siding without submitting a claim to Masonite, if you submitted a claim which was not fully paid in accordance with the terms of this Settlement, or if you have a valid assignment of claim from your buyer. Call 1-800-256-6990 to obtain a form. You may also assign your right to take a future claim to the buyer of your home, by advising the buyer of this settlement and making a written assignment of your potential claim.

8. What if I already made a warranty claim or signed a release?

If you settled a warranty claim with Masonite and you were not represented by an attorney, you are eligible to file a claim. Under the settlement, you will receive the difference, if any, between what you are entitled to under the settlement and any payment previously made to you by Masonite.

If you were represented by an attorney in making a warranty claim against Masonite and signed a full release, you are not eligible to participate in this claims program.

9. Do I need to do anything to participate in the Settlement?

Yes. If you have damage associated with Masonite OmniWood Siding, you will need to complete a Claim Form to begin the processing of your claim. You are encouraged to submit your Claim Form or Claim for Un-Reimbursed Expenditures as soon as possible, and must do so before the end of your applicable claims deadline.

If you believe that you have Masonite OmniWood Siding on your home or structure, but have not yet experienced any damage, please retain this notice and the claim form until you experience damage.

10. How can I exclude myself from the Settlement?

If you have not previously indicated that you wished to be excluded from Cosby v. Masonite , you no longer are able to do so. Your rights are now those of a participating Class Member in the Settlement.

11. How do I make a claim?

If you believe you are an Eligible Claimant, in order to participate in the Settlement, you must make your claims by the applicable deadlines described above, and follow any procedures set by the Court and provide the information requested to support and verify your claim. To begin your claims procedure, you should complete the claim form and return it to the proper address.

12. Who represents the Class?

a. Class Representatives

Plaintiffs Jeff and Donna Cosby, Delores Ruscigno, Charles David Isaak, and David and Virginia Steinmetz have been designated as Class Representatives by the Court. They have presented this action on behalf of the Class since 1996. They have provided documents and information in support of Class Claims.

b. Class Counsel

In its August 7, 1998 order granting preliminary approval of the Settlement, the Court appointed the following attorneys as Class Counsel:

CUNNINGHAM, BOUNDS, YANCE,
SANDLER AHERN & McCONAUGHY PLLC

   CROWDER & BROWN Bennet A. McConaughy

Richard T. Dorman Paul L. Ahern, Jr.

John T. Crowder 1200 Fifth Avenue, Suite 1900

Post Office Box 66705 Seattle, Washington 98101

Mobile, Alabama 36660 Telephone: (206) 346-1750

Telephone: (251) 471-6191

DOFFERMYRE, SHIELDS, CANFIELD,

HAGENS & BERMAN    KNOWLES & DEVINE

Clyde A. Platt, Jr. Ralph I. Knowles, Jr.

1301 Fifth Avenue, Suite 2929 Everette L. Doffermyre

Seattle, Washington 98101 1600 The Peachtree

Telephone: (206) 623-7292 1355 Peachtree Street

Atlanta, Georgia 30309

LEVY, RAM & OLSON, LLP Telephone: (404) 881-8900

Michael F. Ram

639 Front Street, 4th Floor LIEFF, CABRASER, HEIMANN

San Francisco, CA 94111-1913 & BERNSTEIN, LLP

Telephone: (415) 433-4949 Elizabeth J. Cabraser

Jonathan D. Selbin

McRIGHT, JACKSON, Fabrice N. Vincent

   MYRICK & MOORE Embarcadero Center West

1100 First Alabama Bank Building 275 Battery Street, 30th Floor

106 St. Francis Street San Francisco, California 94111-3339

Post Office Box 2846 Telephone: (415) 956-1000

Mobile, Alabama 36652
Telephone: (334) 432-3444

13. Who pays the attorneys' fees and costs?

No Class Member's recovery will be reduced to pay attorneys' fees. In addition to payment to Class Members, Defendants have agreed to pay Class Counsels' attorneys' fees in an amount equivalent to 13% of the claims paid during the life of the Settlement. Of this amount, Defendants have agreed to pay Class Counsel an initial, advance payment of attorneys' fees of $1.7 million. Defendants also have agreed to pay Class Counsels' costs incurred in this litigation, in an amount not to exceed $75,000. These agreements on fees and costs are subject to Court approval. Unlike many settlements, this Settlement does not deduct attorneys' fees or costs from the class benefit, and Class Members have no responsibility to pay any hourly or contingent fees to Class Counsel.

14. Where do I get additional information?

The foregoing is only a summary of the circumstances surrounding the litigation, the claims asserted, the Settlement, and related matters. You may seek the advice and guidance of your own private attorney, at your own expense, if you desire. For more detailed information, you may review the pleadings, records, and other papers on file in this litigation, which may be inspected during regular business hours at Clerk's Office, Circuit Court of Mobile County, Alabama. The address of the Court is: Circuit Court, 205 Government Street, Mobile, Alabama 36602. Copies of the complaint, the Settlement and the papers filed in support of approval of the Settlement are available upon written request to Class Counsel.

Current information is available by calling 1-800-256-6990. This information is also available on the Internet at: http://www.masoniteclaims.com. If you wish to communicate with Class Counsel identified above, you may do so by writing to (1) Class Counsel, c/o 1301 Fifth Avenue, Suite 2929, Seattle, WA 98101, Fax: (206) 623-0594, or (2) any of the Class Counsel listed in Section 12.