On August 19, 2022, the parties in the AFFF PFAS MDL presented oral arguments to the Court in a long-awaited hearing on the government contractor defense. At the hearing, the Court requested supplemental briefing from the parties on the specific issue of what studies were provided to the EPA on the health hazards associated with AFFF, which the parties provided to the court this week.

If successful, the government contractor defense would significantly change the landscape of the PFAS litigation nationally. While extensive briefing was submitted on the issue by several parties, ultimately the tenor of the hearing with the Court reflected a likely outcome of the defense being denied with respect to the AFFF PFAS MDL. Such a denial of the defense would in and of itself have significant impact on PFAS litigation, as it would allow the first bellwether trials on the docket to proceed as currently scheduled in early 2023.

AFFF PFAS MDL

The AFFF PFAS MDL is currently home to over 2,500 cases and is being presided over by Judge Richard Gergel of the United States District Court of South Carolina. Cases that involve allegations of exposure to or pollution from PFAS-containing aqueous film-forming foam (AFFF) are litigated on the consolidated docket. It was announced in 2021 that three bellwether cases would proceed to trial in 2023 from the thousands that reside on the docket. Each of the three cases involves allegations by municipalities that PFAS AFFF polluted drinking water sources in the state, and various PFAS manufacturers, AFFF manufacturers, and suppliers are liable for remediation costs.

Government Contractor Defense

The defendants have long asserted the government contractor defense in the PFAS AFFF MDL, which if successful would relieve them of legal liability for many of the claims on the docket. At its heart, the government contractor defense allows parties doing business with the government to share in the government’s immunity from lawsuits for public policy reasons, if certain criteria are met. The U.S. Supreme Court has held that the government contractor defense proponent must show (1) the United States approved reasonably precise specifications for the product at issue; (2) the product conformed to those specifications; and (3) the supplier warned the United States about dangers in the use of the products known to the supplier but not to the United States.

In the PFAS AFFF MDL, the defendants argue that the government had specific requirements that AFFF had to meet in order to comply with federal guidelines, which could not be met without the use of PFAS in the AFFF. The companies therefore provided what the government wanted. Further, they argue that they warned the government of any hazards that they knew involved with the use of PFAS products, which helped the government make an informed decision about whether to continue using PFAS AFFF.

Oral Argument Takeaways

During the hearing on August 19, 2022 on the government contractor issue, Judge Gergel indicated that he has serious doubts as to whether the government contractor defense applies to the facts of the PFAS AFF MDL. His review of the cited caselaw in the briefing did not support an award of the government contractor defense under these facts, he said.

One issue that received considerable attention from the Court was what the EPA knew about PFAS hazards and the extent of the knowledge that the EPA had.  The defendants argued that they shared hazard / health information with the EPA regarding EPA.  As such, the EPA could make informed decisions about the AFFF product, decide to warn, or reject the product. But the Court seemed more inclined to think that what certain defendants did was provide what he called “pieces of the puzzle” but not a “complete picture.” However, he asked the parties to submit supplemental briefing by August 26 on what precisely the defendants gave to the EPA and when, so he could review it in more detail.

On August 26, 3M filed a document (3M Document) with the Court and other AFFF defendants filed their own document (Telomer document) with the Court. the 3M Document indicated that 450 reports were given to the EPA from 1974 to 2007 to persuade the Court that the EPA was aware of the health risks of PFAS AFFF. Similarly, the Telomer Document provides further argument to the Court that information was provided to the EPA on the environmental hazards of PFAS AFFF well prior to 2000. In addition, the plaintiffs filed their own document listing nine documents that they allege show that certain AFFF defendants misled the EPA about PFAS risks.

Litigation Impacts

The questions from Judge Gergel are telling in that the Court paid special attention to the level of knowledge that all parties involved (corporate, government, etc.) had with respect to hazards associated with PFAS-containing AFFF, and whether there was a free exchange of such information so that the government could make an informed decision. If the government contractor defense is denied by Judge Gergel, these same issues with respect to knowledge will play out as trials proceed in 2023, and may well be one of the crucial deciding factors as to whether punitive damages are awarded should plaintiffs successfully try the bellwether cases to verdict.