Over the last seven days, there have been news reports that major companies embroiled in PFAS litigation — particularly the Aqueous Film Forming Foam (AFFF) MDL in federal court, South Carolina — reached, or are on the cusp of reaching, agreements with plaintiffs to resolve hundreds (and potentially thousands) of disputes concerning PFAS contamination of drinking water supplies owned or operated by various water providers throughout the country.
AFFF is a highly effective firefighting agent used to control and extinguish Class B fuel fires at airports, military bases, and fire training centers among other places.
Late last week, DuPont, Chemours, and Corteva purportedly agreed in principle to a $1.185 billion settlement with water companies/water utilities around the United States to settle all drinking water claims related to PFAS contamination. The agreement is expected to be finalized in the second quarter of 2023 and will be subject to the approval of Judge Richard Gergel, the judge overseeing the AFFF Multi-District Litigation. A settlement fund will be established with Chemours paying $592 million, DuPont adding $400 million, and Corteva contributing $193 million.
According to the settling defendants, the settlement amounts will be funded by the companies in full and then deposited into the water district settlement fund within 10 business days following preliminary approval of the settlement by the court. Upon finalization of a definitive agreement, expected within the second quarter of 2023, the settlement will be subject to approval by the United States District Court for the District of South Carolina. As part of the approval process, the court will establish a timetable for providing notice to class members, hearings on approval, and for class members to opt out of the settlement. The companies will have the right to terminate the settlement if opt-outs exceed specified levels.
In addition, the companies further said that the class includes water systems with a current detection of PFAS at any level and those that are currently required to monitor for the presence of PFAS under EPA monitoring rules or other applicable laws. The class is composed of all Public Water Systems, as defined in 42 U.S.C § 300f, with a current detection of PFAS or that are currently required to monitor for PFAS under the EPA’s Fifth Unregulated Contaminant Monitoring Rule (UCMR 5), or other applicable federal or state law. Approximately 88 percent of the United States is served by systems required to test under UCMR 5.
The companies further noted that the following systems are excluded from the settlement class: water systems owned and operated by a state or the United States government; small systems that have not detected the presence of PFAS and are not currently required to monitor for it under federal or state requirements; and water systems in the lower Cape Fear River Basin of North Carolina (which are included only if they so request). Further, reports indicate that the settlement excludes personal injury claims due to alleged exposure to PFAS, as well as claims by state attorneys general about PFAS contamination of natural resources.
Plaintiffs’ counsel noted in press releases that: “Settlement funds will pay public water systems that have already detected PFAS in their water, will pay the costs of testing for those that have not yet tested, and will provide funds to those that find PFAS as a result of the testing.” This settlement was announced by members of the plaintiffs’ executive committee (PEC) in the AFFF-MDL just a few days prior to the expected start of the first “bellwether” trial in that MDL.
Fast forward to this past Sunday, one day before the start of the bellwether trial, the PEC and 3M — the sole remaining defendant in the bellwether trial — filed a joint motion to stay the trial as it appeared that the parties were close to a settlement. On Monday morning, the court found that the time would be better served by the parties continuing to work toward a settlement agreement on all water-provider cases, including the bellwether trial case. Therefore, the court granted the joint motion to stay the bellwether trial.
Essentially, the terms of the stay order state that within 21 days, 3M and the PEC are to provide a final report on settlement. If 3M and the PEC do not resolve the water-provider cases within 21 days, the court will promptly reschedule the City of Stuart bellwether trial without any further continuances permitted. Based on the court’s stay order, it appears that a “final binding settlement agreement [between the PEC and 3M] is achievable in the near future.”