The legal fallout from the Grenfell fire tragedy has spread to the US, where a shareholder of the company that supplied the cladding panels has filed a new lawsuit.
Lawyers anticipate a flurry of litigation arising from the high-rise blaze in London last month, where at least 80 people died.
A shareholder of Arconic on Thursday filed a lawsuit accusing the company of defrauding shareholders over its supply of cladding panels used on the building.
In the proposed class-action complaint, Michael Brave is seeking to recoup “significant” shareholder losses rising from Arconic’s failure prior to the June 14 blaze to properly disclose its use of “highly flammable” Reynobond PE panels.
The Grenfell Tower is among several high-rise fires around the world that have been linked to the use of cladding panels that contain highly flammable plastic materials which can burn with ferocious speed when ignited.
The blaze has triggered inspections of buildings around the UK, but also in other countries where such panels are commonly used.
“A lot of our main contractor clients are doing surveys of buildings to see what materials have been used and what the risk is of similar incidents,” said Adrian Bell, the co-head of the infrastructure, construction and energy disputes group at CMS, the world’s sixth-largest law firm.
He expects to see breach of contract claims between building owners and contractors to follow in the wake of the blaze. “They would look at whether the correct materials have been used and whether the contractors correctly discharged their obligations,” he added.
The lawsuit filed in the federal court in Manhattan, where Arconic is based, is thought to be the first in the US linked to the fire in North Kensington last month.
Arconic’s share price fell 21 percent between June 14 and June 27, the day after the company once known as Alcoa said it would stop selling the panels for use in high-rises.
That decline reduced Arconic’s market value by more than $2.5 billion, according to Reuters data.
Arconic declined to comment on the lawsuit. Brave said shareholders were deceived by Arconic’s inadequate disclosures regarding the cladding panels, and that their use significantly increased the risk of property damage, injury or death in buildings containing them.

Source: Arab News