Hundreds and hundreds of claims for personal injury and property damage associated with PFAS contamination have been accumulating in the courtroom of a Federal Judge in South Carolina. A little over four years ago the Federal Judicial Panel on Multidistrict Litigation determined that Federal claims that Aqueous Film-Forming Foams (AFFF) containing PFAS used to fight fires had contaminated drinking water had enough in common that they should all be sent to Federal Judge Gergel in South Carolina for disposition.
Over the past four years, Judge Gergel has done an admirable job of herding the many cats involved in these claims from coast to coast and was on the verge of a "bellwether" trial against AFFF manufacturers regarding PFAS costs incurred by a city owned water utility in Florida.
Now one of those AFFF manufacturers has been given a pass for now by Judge Gergel because that AFFF manufacturer has sought Chapter 11 bankruptcy protection in Delaware. It seems that the manufacturer's PFAS liabilities exceed its assets.
We can expect many more PFAS-related bankruptcy petitions as EPA continues to follow its PFAS road map, having reached the conclusion that PFAS in drinking water are an "urgent public health and environmental issue".
At the same time, many of those who might otherwise be liable for PFAS contamination are asking Congress to absolve them of that liability.
So if getting where EPA and many States say we need to get when it comes to PFAS is going to cost billions of dollars, and many of those who would otherwise be liable for those billions of dollars in costs are ultimately bankrupt or exempt from liability, then where is the money to pay those costs going to come from? Some of those billions were provided in the Inflation Reduction Act but many billions more will be needed. Recent developments in the Bankruptcy Court and Congress suggest we should be deliberating about where we want to get when it comes to PFAS and how we're going to get there.
A federal district judge overseeing multidistrict litigation (MDL) over PFAS contamination has suspended claims against the seller of aqueous film-forming foam (AFFF), Kidde-Fenwal Inc. (KFI), as it pursues bankruptcy protections, a move that comes just weeks ahead of a "bellwether" trial that the company says involves claims it cannot afford to pay.
"Based on the number and nature of AFFF claims and recent, confidential settlement demands, KFI believes the alleged AFFF liability substantially exceeds the capacity of KFI to pay," the company says in its May 14 filing with the U.S. Bankruptcy Court for the District of Delaware.
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