$54 Million PFAS Settlement By Downstream Business
Last week, the parties in litigation in Michigan announced to the Court that they had reached an agreement to resolve the environmental pollution claims pertaining to PFAS land contamination. The PFAS settlement was for the sum of $54 million. The lawsuit was brought against 3M and Wolverine Worldwide, a downstream PFAS user that allegedly dumped PFAS waste that eventually contaminated surrounding lands. The lawsuit, while local to the state of Michigan, is a stark reminder of a message that we have reiterated for years – that downstream commerce users of PFAS are susceptible to involvement in PFAS litigation and that companies with any current or legacy use of PFAS must conduct full risk assessment and risk management protocols to fully understand the scope of risk.
In the lawsuit against Wolverine, it was alleged that Wolverine used certain PFAS in its leather tanning practices for many years, and dumped the waste products into a landfill that ultimately leached, causing contamination of property in the area owned by approximately 1,700 residents. The lawsuit did not address personal injury claims that any of the residents might have; rather, the case focused only on loss of property value allegations. Payout amounts will be based on factors such as the severity of contamination at each property, the number of people affected at each property, whether the home received a water filtration system from Wolverine and whether the property has been able to connect to the municipal water lines through an expansion project currently underway.
The proposed PFAS settlement of $54 million must still be approved by the presiding judge for the litigation.
Downstream Business Implications
The Wolverine lawsuit is a perfect example of downstream users of PFAS being increasingly targeted in lawsuits involving claims of environmental pollution due to PFAS. It is of the utmost importance that businesses along the whole supply chain evaluate their PFAS risk. Public health and environmental groups urge legislators to regulate these compounds at an ever-increasing pace. Similarly, state level EPA enforcement action is increasing at a several-fold rate every year. Companies that did not manufacture PFAS, but merely utilized PFAS in their manufacturing processes, are therefore becoming targets of costly enforcement actions at rates that continue to multiply year over year. Lawsuits are also filed monthly by citizens or municipalities against companies that are increasingly not PFAS chemical manufacturers.
Conducting regular self-audits for possible exposure to PFAS risk and potential regulatory violations can result in long term savings for companies and should be commonplace in their own risk assessment.