PFAS Georgia Rulings Open Door To Downstream Liabilities
In June 2021, we detailed various PFAS lawsuits in Georgia stemming from alleged drinking water pollution from the carpet manufacturing industry based in Dalton, Georgia (the “carpet capital of the world”). The lawsuits allege that the numerous carpet manufacturers in the region have for years polluted waterways and drinking water sources with PFAS, which will cost tens of millions of dollars to remediate. Last week, a Georgia federal judge presiding over one of the federal cases issued a 180 page Order (Georgia PFAS Case Order) that allowed many of the claims to proceed against water districts and carpet manufacturers, but dismissed various claims against PFAS manufacturers such as 3M and DuPont. While the chemical manufacturers remain in the case on some claims, the PFAS Georgia rulings will have enormous impacts on the future of the PFAS litigation, as it presents the possibility that the PFAS chemical manufacturers (who have thus far born the brunt of legal liability for PFAS environmental pollution claims) may in some instances be off the hook, with downstream companies and water utilities left with legal liability.
PFAS In The Carpet Capital Of The World
Dalton, Georgia sits in the northern region of the state and since the 1990s, the area has produced almost 90% of the world’s carpet. The carpet industry utilizes PFAS in many carpet applications, in particular to make carpets that are stain resistant. The waste from the carpet manufacturing facilities was historically sent by way of effluent to Dalton Utilities, which ultimately feeds into the Conasauga River, about an hour and a half north of Atlanta. The Conasauga River flows south and supplies water to numerous waterways, including the Oostanaula River, which runs through the city of Rome. Rome once used up to ten million gallons of water a day from the Oostanaula, but it stopped using the river as its main drinking water source in 2016 due to PFAS concerns.
PFAS Georgia Rulings
In 2019, a class action lawsuit was filed in Georgia state court (the lawsuit was later removed to federal court) by citizens that obtain their drinking water from Rome, including adjacent cities that purchase drinking water from Rome. The lawsuit is styled as Jarrod Johnson v. 3M, et al., 19-CV-02448JFL003. In the lawsuit, the citizens allege that carpet manufacturers and chemical suppliers (e.g. – 3M, DuPont, etc.) contaminated their drinking water with PFAS and caused the following damages: (1) pollution of drinking water constituting a nuisance, (2) increased costs for drinking water that municipalities passed on to consumers due to the necessity of installing PFAS filtration technology, (3) remediation costs to cleanup PFAS from the drinking water supplies, and (4) an injunction request to force the named defendants from any further PFAS discharge into the water supplies.
Twelve Motions to Dismiss were filed on numerous legal grounds, which were all ruled on by the federal court last week. Most of the nuisance and Clean Water Act claims were allowed to move forward. However, the Court also dismissed several claims against “chemical suppliers”, such as 3M and DuPont, ruling that they could not have foreseen the pollution issues in question, as they did not directly pollute the riverways and drinking water sources in question.
Implications Of The Rulings On PFAS Litigation
The PFAS Georgia rulings could have enormous ripple effects on PFAS litigation nationally, although it is important to note that the ruling relied on Georgia law to reach its conclusion. To date, 3M and DuPont have born the brunt of the billions of dollars in settlements for PFAS environmental remediation claims nationally. Increasingly, downstream commerce companies are being brought into similar lawsuits; however, the ruling introduces the argument that a PFAS manufacturer and supplier is not legally responsible for PFAS that it supplied to sophisticated product manufacturers. This will cause litigants to shift their attention more towards product manufacturers when they seek remediation costs and monetary damages for PFAS pollution. The billions of dollars that PFAS manufacturers have spent thus far defending and settling PFAS contamination lawsuits will find itself spreading to companies, such as the Dalton area carpet manufacturers, that utilized PFAS in a consumer product and that emitted PFAS waste into the environment.
The implications for companies that have used PFAS in manufacturing processes are enormous. Not only are these companies rapidly becoming the targets of state level EPA enforcement action for PFAS pollution issues, but the companies will now also find themselves embroiled in costly civil litigation. We have previously predicted that downstream commerce companies will face this reality very soon, most recently in the context of lawsuits in Maine focusing on the paper industry.
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.