Into the Unknown

Growing concern over per- and polyfluorinated substances (PFAS) is cascading into a surge of unprecedented litigation. Like the chemicals themselves, PFAS-related lawsuits are becoming ubiquitous, spreading far beyond the initial exposure and environmental contamination claims we’ve seen to date. These legal actions are now encompassing a broader array of defendants that have incorporated PFAS chemicals into their products or packaging, venturing into uncharted territory concerning bodily injury, and expanding into other causes of actions.

Given the current absence of substantial judicial precedent regarding coverage matters and liability defenses in the context of PFAS and aqueous film forming foam (AFFF), manufacturers, sellers, and commercial consumers of PFAS and their insurers will be closely watching litigation, looking to future rulings for guidance about the viability of coverage defenses raised in other pollution claims.

Where We Are Today

PFAS litigation, to date, has been largely limited to five basic categories:

•                 Firefighters have claimed exposure to PFAS resulting from their use of AFFF firefighting products. These suits allege various defendants manufactured, designed, marketed, and sold AFFF with knowledge that it contained PFAS, and that they knew or should have known the various health hazards associated with PFAS and AFFF, but failed to warn plaintiffs. The firefighter plaintiffs claim their exposure to AFFF, largely during training and response exercises, caused them cancer, thyroid disease, pregnancy problems, ulcerative colitis, and various autoimmune diseases.

•             Public and private water suppliers have sued AFFF and fluorosurfactant manufacturers. These water-supplier plaintiffs allege the manufacturers caused PFAS to contaminate their water supplies through the use of AFFF and migration of PFAS into the groundwater. The plaintiffs similarly allege defendants’ knowledge of dangers associated with AFFF and PFAS and seek damages for purchasing water from alternate sources, investigating and remediating PFAS contamination until it can no longer be detected, and sampling and monitoring water for PFAS. Many of the pending water supplier cases are settling, with chemical manufacturers paying as high as $12.5 billion in damages. We anticipate more and similar settlements. These cases raise difficult and complex questions about whether, when, and how PFAS putatively contaminate drinking water.

•    States’ attorneys general (AGs) have sued manufacturers, distributors, and suppliers of commercial AFFF for contamination of their states’ waterways, alleging violation of environmental statutes and common law. These state AG cases pose the most substantial liability to defendants because they are alleging statewide contamination, not merely contamination of discrete areas.

•    People who drank PFAS-contaminated water claim cancer, thyroid disease, pregnancy-related hypertension, and damage to the liver and immune system. They have sued manufacturers and sellers of PFAS-containing products for product liability and failure to warn of the dangers of PFAS. These cases raise thorny questions of proving PFAS’ impact on the body and tying that impact to particular manifestations of diseases.

•    Plaintiffs have brought traditional environmental claims against companies that made AFFF or used PFAS in making products. For example, furniture and carpeting companies have used PFAS to make their products stain-resistant or waterproof and the PFAS used in production or contained in their products allegedly contaminated surface and groundwater.

Where Are We Headed?

PFAS-related suits are moving far beyond exposure claims levied against companies that manufactured and sold the chemicals, opening the door for a vastly wider range of defendants and claims.

Airports: Starting in 2020, experts have recommended that airports stop using AFFF, a common suppressant used by virtually every airport across the U.S. to fight fuel-based fires and required by the Federal Aviation Administration for all airports providing commercial passenger service. However, airport liability from historic use of AFFF remains significant.

For example, in a suit filed in September 2023, a state sued an airport alleging that, for decades, the airport used AFFF, which resulted in substantial PFAS contamination of groundwater and residential drinking wells near the airport. The airport used AFFF not just in fighting fires, but also in firefighting training. The state sought to have the airport remediate the contamination since 2020, but the airport has not done so.

This suit appears to be a significant development. Prior to this suit, suppliers of water whose water supplies are contaminated with PFAS have focused almost entirely on companies that manufactured and sold products containing PFAS, such as AFFF. Water suppliers are now turning their attention to airports that used the AFFF to assume the significant cost of remediation and cleaning up of PFAS-contaminated groundwater, reservoirs, and private supplies. We can expect lawsuits against every major airport that utilized AFFF.

Consumer products and packaging: Consumers are becoming more aware of how PFAS are used to make many daily products—such as cookware, food packaging, cosmetics, personal care products, and clothing—be non-stick, grease-resistant, flame retardant, and waterproof. Consumers’ increased awareness of what PFAS are and where they can be found has, unsurprisingly, led to more PFAS litigation. These suits go beyond claiming bodily harm from exposure, which can be difficult to prove, expanding into claims of false advertising and causes of action for violations of state consumer protection statutes and violations of consumer fraud and deceptive business practices acts.

For example, consumers have sued a fast food company for PFAS used in its packaging. Multiple suits allege that packing in several popular food items have exposed consumers to “high levels of PFAS” described as “a group of synthetic chemicals known to be harmful to both the environment and humans” and “forever chemicals.” 

A major beverage company and one of its brands are also facing a similar suit. In December 2022, the putative class representative alleges that the brand’s juice drink, which is described as being “prominently labeled as an ‘All Natural’ juice drink,” contains non-natural PFAS.

A leading athletic, apparel, footwear, and sports manufacturer has also been sued for the inclusion of PFAS in its products. In this case, the plaintiff alleges that a duffle bag is being sold in violation of the California Health and Safety Code because the bags do not contain a clear and reasonable warning about the potential of exposure to PFAS found in the bag’s water-resistant coating.

These suits open the door for large awards that include restitution, disgorgement, and fines, in addition to compensatory damages. Given this potential recovery, plaintiff’s firms are advertising and soliciting potential class representatives to bring suit about PFAS in a wide range of products, and the number of claims is only expected to grow.

Emerging Laws and Regulations

In the last few years, we have seen new and proposed federal and state laws and regulations governing PFAS. For example, the EPA has promulgated or sought to promulgate several new PFAS regulations, including the establishment of National Primary Drinking Water Regulations (NPDWR) for six common types of PFAS, as well as issuing its fifth Unregulated Contaminant Monitoring Rule (UCMR 5), requiring most public water systems to monitor for PFAS. The NPDWR, if finalized, would require drinking water systems in all states to monitor for a range of PFAS substances, and would preempt more lenient preexisting state regulations. According to the EPA, more than 10,000 public water systems will be required to participate in UCMR 5, which sets forth minimum reporting levels (MRLs) ranging from three to five PPT (parts per trillion) for several common types of PFAS.

These new and proposed EPA standards are extraordinarily stringent and difficult to meet and will give rise to noncompliance claims against the regulated entities. These MRLs could indeed form the basis of future suits. It will generally take decades of treating water contaminated with PFAS to be remediated and cleansed, which is a substantial cost for the water suppliers, especially because the capital costs of water treatment facilities are significant.

Several states have also passed legislation banning PFAS in certain food and consumer products. A few states, such as Colorado and New York, have banned PFAS in certain products where the PFAS is “intentionally added” and serves an intended function in the product. We anticipate the matter of intentionally versus unintentionally added PFAS will be a heavily litigated issue.

Exposure to PFAS-related liability is now moving into other areas in which PFAS were used to package products. Indeed, several states have passed laws and regulations restricting or barring the use of PFAS from food packaging. However, although there have been no new FDA regulations concerning PFAS in food packaging, it has been suggested that the FDA could classify PFAS in food packaging as a food additive. In that scenario, current state laws governing PFAS in food packaging could be preempted.

Likewise, PFAS claims and lawsuits are likely to expand into other industries such as dyers, recyclers, cosmetics manufacturers, plastics manufacturers, and retailers. These parties face liability due to their release of PFAS into the environment through improper disposal of waste products and misleading labeling and marketing of PFAS-containing products, especially in light of the new laws passed by the various states.

Insurance Issues

PFAS coverage litigation revisits seminal insurance concepts such as fortuity, tests the pollution exclusion, and continues to evolve. There have been relatively few PFAS- and AFFF-related coverage actions and fewer coverage decisions and rulings. Therefore, there is virtually no judicial guidance with respect to many coverage issues and defenses for liabilities arising out of PFAS and AFFF.

The landscape of PFAS and AFFF coverage is changing, however. Insurers and insureds will litigate various coverage defenses with respect to the different kinds of PFAS and AFFF liabilities. We anticipate future rulings will provide guidance about the viability of coverage defenses raised in other pollution claims.

For example, courts will have to address whether discharges of PFAS and AFFF constitute an “occurrence,” and whether the necessary fortuity exists. Relatedly, there are open questions about the application of the expected or intended injury exclusion, known conditions exclusion, known loss doctrine, or loss-in-progress doctrine. Ultimately, determining whether these exclusions and doctrines apply requires the trier of fact to determine what an insured knew and when. This will be a key component in policies containing “anti-Montrose” insuring agreements. In all likelihood, many PFAS insureds were aware that bodily injury or property damage had occurred years ago and, thus, cannot satisfy this condition of no pre-inception awareness or knowledge. This will be a fact-sensitive inquiry.

Another coverage issue that may likely arise is determining when the claimants’ injuries occurred, such as when they were exposed to PFAS or when symptoms manifested. This will vary by jurisdiction and will likely mirror those jurisdictions’ similar treatments of other toxic tort claims.

Additionally, because virtually all PFAS-related claims will arise out of some form of pollution, PFAS coverage lawsuits also implicate the pollution exclusion. Courts will look at whether claims involve typical environmental pollution, product pollution liability, or something else. Courts will also look at the exclusions’ wording to determine whether it applies to product pollution liability, and whether it contains a “sudden and accidental” exception. There also may be express exceptions or carve-outs in the exclusions, such that they may not apply to product pollution liability claims.

Finally, pollution liability policies are increasingly containing exclusions for PFAS and “related chemicals.” Given the numerous types of PFAS and replacement surfactants, we would expect courts to issue coverage rulings on the scope and effect of such PFAS exclusions.

What began as claims primarily tied to environmental contamination and exposure has now evolved into a multifaceted legal landscape encompassing a wider range of defendants and types of claims. With new laws, regulations, and emerging industries being drawn into the fold, the trajectory of PFAS litigation remains dynamic, with far-reaching consequences for those involved in the fight against these chemicals.