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U.S. Gypsum Company

Expert Fact Checked

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Jennifer Lucarelli Lawyer and Legal Advisor

United States Gypsum produced asbestos construction materials from 1920 to 1978. Many workers and consumers developed asbestos diseases as a result. Asbestos lawsuit costs drove the company bankrupt in 2001. It created an asbestos trust fund in 2006 to pay out claims. The trust is still operational.

01. History of Asbestos Use

U.S. Gypsum Company History of Asbestos Use

In 1902, 30 independent rock and plaster companies merged to form the United States Gypsum Company (U.S. Gypsum or USG). This merger gave the new company access to the formerly independent resources and local markets of all 30 companies. From 1920 to 1978, some of the company’s products contained asbestos.

Quick Facts
  • Years in Operation: 1902 – Present
  • Location: Chicago, Illinois
  • Production: Construction materials
  • Asbestos Trust: Yes

In 1903, USG developed its first building product. Before that, USG had mined and prepared gypsum for other companies to use. The company continued to expand its offerings and purchased Sackett Plaster Board Company in 1909. This marked USG’s entry into plaster and gypsum board products, which we know as drywall today.

Beginning in 1920, USG started manufacturing and selling various asbestos-containing products, such as its drywall. It expanded its product line throughout the decade.

Legal records indicate USG studied the effects of asbestos starting in the 1930s. In 1936, it and other companies funded tests that indicated asbestos could cause cancer in mice.

USG stopped using asbestos in its products in 1978. Still, former employees and consumers started filing asbestos claims against the company. USG faced millions of dollars’ worth of asbestos claims and declared bankruptcy in 2001.

USG reorganized, repaid shareholders and lenders in full, and emerged from bankruptcy in 2006. Part of the reorganization plan included the creation of a nearly $4 billion asbestos trust to handle current and future asbestos claims.

02. Asbestos Products

U.S. Gypsum Company Asbestos Products

USG used asbestos in some of its products from 1920 to 1978. Asbestos provided products with durability and fire-proofing qualities. These properties made the harmful mineral seem like a valuable addition to construction products.

USG originally produced plaster and Sheetrock. After World War I, the company expanded its offerings to include other construction materials. USG’s other asbestos products included Durabond joint compound, Perf-A-Tape and Red Top Structo-Lite.

USG became a leading supplier of asbestos materials in the post-World War II housing boom. It also entered the commercial building industry, supplying products for residential and commercial needs.

U.S. Gypsum Company Products Containing Asbestos

List of Products Containing Asbestos
Product Name Start Year End Year
United States Gypsum “Sheetrock” Texture 1964 1979
United States Gypsum Asbestos Felts & Covering 1936 1939
United States Gypsum Asbestos Paper 1936 1939
United States Gypsum Audicote Acoustical Plaster 1955 1973
United States Gypsum Bondcrete 1940 1943
United States Gypsum Ceiling Tile 1967 1976
United States Gypsum Cement Plaster Regular 1943 1947
United States Gypsum Corrugated Cool Felt Air C. Covering 1936 1939
United States Gypsum Corrugated Wool Felt Covering
United States Gypsum Durabond 90 Joint Compound 1970 1976
United States Gypsum Durabond Joint Compound 1960 1975
United States Gypsum Firecode Plaster 1959 1964
United States Gypsum Glatex Asbestos Cement Siding
United States Gypsum Gypsum Woodfibre Plaster
United States Gypsum Hi-Lite Acoustical Plaster 1950 1975
United States Gypsum Imperial Gypsum Cement Plaster
United States Gypsum Imperial Gypsum Plaster 1940 1970
United States Gypsum Imperial Tape 1962 1968
United States Gypsum Oriental Exterior Stucco Finish Coat 1930 1973
United States Gypsum Perf-A-Tape Compound 1945 1975
United States Gypsum Perf-A-Tape Joint System 1945 1975
United States Gypsum Pipe Covering
United States Gypsum Pyrobar Mortar Mix 1969 1972
United States Gypsum Pyrobestos PC Board & Stack Lining 1936 1939
United States Gypsum Range Boiler Jackets Pipe Covering 1936 1939
United States Gypsum Red Top Cement Plaster 1920 1958
United States Gypsum Red Top Gypsum Plaster 1920 1958
United States Gypsum Rigid Block Insulation (Generic)
United States Gypsum Roofing Products 1937 1975
United States Gypsum Sabinite Acoustical Plaster 1935 1965
United States Gypsum Siding Shingles 1937 1975
United States Gypsum Spray Texture Paint/Finish
United States Gypsum Spraydon Fireproofing Plaster 1965 1971
United States Gypsum Structo-Lite Perlited Gypsum Plaster 1975
United States Gypsum Super Hard Spray
United States Gypsum Texolite 1961 1967
United States Gypsum Textone 1944 1975
United States Gypsum Texture Paint
United States Gypsum Thermalux (Generic) 1961 1965
03. Occupational Exposure

U.S. Gypsum Company and Occupational Exposure

USG asbestos products exposed thousands of people to the dangerous mineral. One of the largest sources was occupational exposure. USG employees and workers who used the company’s products were most at risk of asbestos exposure.

In the early 1930s, USG funded testing to explore the effects and hazards of industrial dust, including asbestos. Through these studies, company officials learned about the dangers of asbestos cancer in the 1930s and 1940s. But the company did not disclose this information to its workers. USG also engaged in many marketing campaigns insisting on the safety of asbestos.

After many years of asbestos use by the company, USG workers began developing asbestos diseases like mesothelioma. Many workers blamed these illnesses on occupational exposure from their time at USG.

Occupational asbestos exposure extended beyond USG’s direct employees, also affecting those who frequently used the company’s products. For example, drywall workers faced exposure risks as they handled, cut, sanded and installed the company’s asbestos-containing drywall materials. These activities released asbestos-containing dust into the air, where it could be inhaled.

Occupations Impacted by U.S. Gypsum Company’s Asbestos Use

Many people came into contact with the asbestos in USG products, not just workers. For instance, many homeowners may have performed renovations or repairs using USG products that contained asbestos. Once asbestos dust is airborne, it can lead to exposure for those in the area.

Workers may also accidentally carry fibers to a second location. Anyone who used USG asbestos products at work could unknowingly bring home fibers on their clothing and belongings. This may lead to secondary exposure for their family members. People who develop an asbestos disease from secondary exposure may be eligible to file claims for compensation.

04. Asbestos Litigation

Asbestos Litigation Against U.S. Gypsum Company

USG’s asbestos use led to over 250,000 asbestos lawsuits between 1994 and 2001. This significantly impacted the company’s finances, with litigation costs exceeding $450 million.

The company faced personal injury lawsuits filed by people who developed asbestos-related diseases. Lawsuits may result in asbestos compensation for the injured parties. Other types of lawsuits were also filed against USG.

For example, in 1984, the city of Baltimore named USG and several other asbestos companies in a product liability lawsuit. The city sought compensation for the “cost of discovering, managing, rectifying the effects of, and removing asbestos-containing surface treatment products.”

The jury awarded the city of Baltimore more than $8 million in compensatory damages against USG. Compensatory damages are meant to repay plaintiffs for the costs of the defendant’s wrongdoings.

In 2001, USG declared Chapter 11 bankruptcy because of asbestos litigation costs. A trust fund was created several years later to handle related claims.

05. Asbestos Trust Fund

U.S. Gypsum Company Asbestos Trust Fund

USG filed for bankruptcy in 2001. In just the first half of that year, the company was named in more than 22,000 new asbestos and mesothelioma claims.

In 2006, the USG Asbestos Personal Injury Trust was created during bankruptcy proceedings. It was initially funded with $3.9 billion to handle current and future claims. It continues to accept claims today. The current payment percentage is 12.7%. This rate is reviewed often to ensure the trust has enough money to pay future claims.

The current payment percentage for successful claims is 12.7%.

The USG trust also handles asbestos injury claims against A.P. Green Industries, an asbestos product manufacturer USG acquired in 1967.

Claim payouts may vary based on several factors, including the victim’s age, exposure details, type of asbestos disease and the firm’s settlement history. Experienced asbestos attorneys can help victims file trust fund claims.

06. Common Questions

Common Questions About U.S. Gypsum Company

When did U.S. Gypsum Company stop using asbestos?

U.S. Gypsum stopped its asbestos use in 1978. It had used asbestos in some products since 1920. Company records indicate that not all, but many, of its products contained the mineral. Asbestos is a dangerous and carcinogenic material.

What percentage does the U.S. Gypsum Company asbestos trust pay?

As of January 2024, the USG Asbestos Personal Injury Trust had a payment percentage of 12.7%. This percentage was updated in August 2022. It will continue to be reviewed often to make sure the fund has enough money to continue paying claims.

When was asbestos banned in drywall?

In 1977, the U.S. Consumer Product Safety Commission (CPSC) issued a partial asbestos drywall ban. It banned joint compounds and drywall tape. In 1989, the Environmental Protection Agency (EPA) tried to issue a more complete ban, but it was quickly overturned. Currently, asbestos is not banned in drywall in the United States.

Who owns U.S. Gypsum Company?

U.S. Gypsum is owned by Knauf, a German construction product company. Knauf acquired USG in 2019. USG remains headquartered in Chicago, Illinois.