Trex Co. Inc.
) has settled a class action lawsuit filed in California against
charges of misrepresentations and defects in its first-generation
composite products. The litigation was mainly related to mold
growth and color issues of the products. The U.S. district court
granted preliminary approval to a Settlement Agreement on Aug 19.
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Relief will be available to consumers who experienced a certain
level of mold growth, color fading or color variation in the
products bought between Aug 1, 2004, and Aug 19, 2013. Trex will
provide qualified claimants a one-time cash payment or the
opportunity to receive other relief, including a rebate
certificate on its newer-generation shelled products.
The cost of the settlement has been pegged at $8.25 million.
Attorneys' fees will be around $1.475 million. Both are pending
the final approval by the court. The settlement will allow Trex
to avoid additional expensive, time-consuming litigation and
focus on delivering quality products and service to consumers.
The class action was the second faced by Trex. Several years ago
it settled a previous class action for first-generation Trex and
Timbrex decking and railing alleged as having rot, splintered and
One of Trex's competitors,
Advanced Environmental Recycling Technologies
), also settled a class action suit several years ago. The suit
was for its Choice Dek product line, as customers were facing
trouble in keeping their decking free from mold and surface
Winchester, VA-based Trex manufactures and distributes
wood/plastic composite products and related accessories,
primarily for residential and commercial decking and railing
applications in the United States. The stock currently retains a
Zacks Rank #3 (Hold).
Other stocks in the same industry with favorable Zacks rank
CaesarStone Sdot-Yam Ltd.
) with a Zacks Rank #1 (Strong Buy) and
) with a Zacks Rank #2 (Buy).