While Earth was completing yet another trip around the sun, many developments occurred within the per- and polyfluoroalkyl substances (PFAS) space, including the pending Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) and Safe Drinking Water Act regulations for perfluorooctanoic acid (PFOA), perfluorooctanesulfonic acid (PFOS), and certain other PFAS and the Toxic Substances Control Act (TSCA) 8(a) reporting rule in the United States, and a proposed PFAS ban in the European Union.
These updates in the last year alone would be enough, but add in PFAS consumer products litigation and bans on products containing PFAS, and staying on top of PFAS regulation may feel like preparing for a space odyssey. Here we review proposed PFAS regulation and litigation considerations in 2023 to help industry and manufacturers stay in compliance and on mission.
Countdown to Blastoff: Pending CERCLA PFOA and PFOS Regulation
In September 2022, the first potential designation of a chemical as a hazardous substance under CERCLA by rulemaking occurred when the US Environmental Protection Agency (EPA) proposed to designate PFOA and PFOS as hazardous substances. The final rule will impact a broad range of companies and industries, many of which made their feelings known with more than 600 responses during the comment period. A final rule is anticipated in August 2023.
Additionally, EPA recently issued a notice of proposed rulemaking (ANPRM) seeking public input on whether to designate other PFAS as hazardous substances under CERCLA. Specifically, EPA is seeking input on (i) whether to designate seven other PFAS (PFBS, PFHxS, PFNA, HFPO-DA, PFBA, PFHxA, and PFDA), (ii) whether to designate precursors to PFOA, PFOS, and the seven aforementioned PFAS, and (iii) whether to designate categories of PFAS, as hazardous substances. This proposed rulemaking is open for comment through June 12, 2023.
Once final, PFOA and PFOS would need to be considered in the remedial investigation/feasibility study (RI/FS) process at Superfund sites. This would potentially include the addition of new potentially responsible parties (PRPs) to existing Superfund sites and new sites to the National Priorities List based on PFAS contamination, as well as a possible reopener of previously closed sites under the five-year review process to address potential PFAS contamination. This development triggers the release reporting requirement under both CERCLA and the Emergency Planning and Community Right-to-Know Act (EPCRA). Litigation will also likely increase as additional cost-recovery and contribution claims are filed.
The addition of PFOA/PFOS and other PFAS as CERCLA hazardous substances poses several challenges, including the following:
Safe Drinking Water Act: National Primary Drinking Water Regulations
The Safe Drinking Water Act (SDWA) was established to protect the quality of drinking water in the United States. Last month, nearly 50 years since its passage, EPA released its landmark proposed rule setting a National Primary Drinking Water Regulation (NPDWR) that would establish legally enforceable Maximum Contaminant Levels (MCLs) and health-based, nonenforceable Maximum Contaminant Level Goals (MCLGs) for six PFAS:
EPA’s proposal to regulate the latter four PFAS chemicals as a mixture under its proposed Hazard Index approach, instead of at a set concentration amount, is a first and may foreshadow future EPA actions to regulate PFAS as a class. If promulgated, this will be the first federally enforceable drinking water standard for PFAS and also the first NPDWR under the SDWA in decades.
Under EPA’s proposed rule, public water systems will be required to do the following:
EPA has lauded this regulatory action as a cornerstone of its whole-of-agency approach to regulate PFAS and protect human health and the environment.
The implications of EPA’s proposed rule are far-reaching and will not be limited to public water systems. An estimated 66,000 public water systems will be subject to this rule with compliance costs expected to range from $772 million to $1.2 billion annually. The NPDWR is a significant next step in the regulation of PFAS and likely the first in a series of legally enforceable standards as EPA continues its push to regulate and reduce PFAS in the environment.
EPA’s NPDWR proposed rule was published in the Federal Register on March 29, with the public comment period set to close on May 30, 2023. While EPA has received a number of requests to extend the comment period another 30 days, at minimum, the deadline has yet to be officially extended.
The proposed rule does not require any specific action until it is finalized, which EPA anticipates to be by the end of the year. Challenges to EPA’s proposed rule, however, can likely be expected, focusing on such areas as EPA’s underlying science, the agency’s proposed novel use of a Hazard Index approach to regulate four additional PFAS as a mixture, and EPA’s cost-benefit determination.
For more details, read our LawFlash, EPA Proposes Enforceable Drinking Water Standards for PFOA, PFOS, and Four Other PFAS.
The objective of EPA’s proposed reporting rule is to require PFAS chemical manufacturers, producers, and importers to report on their usage of PFAS in every year since 2011. The rule was initially due to be finalized by January 1, 2023, but that date shifted to March 2023 following EPA’s re-analysis of the proposed rule’s cost on small businesses. Though March has come and gone, EPA has yet to indicate a new final publication date.
Absent major changes, the proposed rule will pose significant challenges to regulated entities. To start, the scope of regulated entities may be enormous, as it would cover manufacturers, producers, and importers not just of PFAS in raw form, but also of “articles” that include PFAS as a component or byproduct. Given the ubiquity of PFAS in consumer and commercial products, the rule would touch businesses across virtually every industry, and it does not, in proposed draft form, exempt small businesses or allow for de minimis use exceptions.
Further, the categories of information to be reported are very detailed and must be broken out not just by chemical, but also by year, from 2011 through the present. The disclosure of such exhaustive information concerning PFAS chemicals may have significant implications for many reporting entities.
EPA’s recent updated economic analysis, released in November 2022, increased its estimate of small business compliance costs from $10.8 million to $876 million—an 81-fold increase. This dramatic increase, and attendant considerations as to effectively reducing the burden on small businesses while still meeting the objectives of the authorizing statute, are likely causes for delay in final publication of the rule. Though we do not know what changes EPA is contemplating, both a Small Business Advocacy Review panel and public commenters have proposed modifications ranging from increased time to comply to outright exemptions for small entities.
Although the final rule remains unknown, businesses of all sizes are well advised to begin planning not just for compliance with the rule itself, but also for scrutiny from both regulators and the public of their past and present PFAS usage that may be prompted by the reporting.
PFAS “bans” take many forms. In the United States, eleven states have enacted legislation prohibiting “intentionally added PFAS” in packaging and food-contact materials. Several states also ban PFAS or “intentionally added PFAS” in consumer products. For example, many states have enacted legislation to ban PFAS in products such as carpets, rugs, textiles, cosmetics, and juvenile products, most of which restrictions are being phased in over the next two to five years. In Maine, all products with intentionally added PFAS will be prohibited by 2030 via a phased-in approach. Manufacturers, suppliers, and retailers alike are having to grapple with compliance certifications and supply chain impacts, and some companies are taking steps to phase out the manufacture and use of PFAS altogether.
The newly proposed European Union PFAS ban (under the umbrella of the Registration, Evaluation, Authorisation and Restriction of Chemicals law, or REACH) covers chemicals, mixtures, and articles with 25 ppb or more of a specified PFAS or 250 ppb of a combination of PFAS. The proposed ban is expected to have a very broad reach, impacting manufacture, use, and placing on the market—basically, anyone exporting products to the EU. Final restrictions are expected in 2025.
The program’s phaseout would begin 18 months after the rule is finalized, with derogations allowing certain phaseouts to take place over 5- or 12-year periods. Affected businesses may need to reexamine the composition and design of thousands of products. The proposed EU ban could also prompt additional US state bans and federal legislation.
In addition to the foregoing regulatory activity, private litigation related to PFAS in products has grown. Increasingly, consumers are filing putative class actions against manufacturers and retailers to recover alleged economic losses associated with the undisclosed presence of PFAS in consumer products.
To assert these claims, consumers frequently engage a third party to test consumer products for PFAS chemicals. Using the alleged results of those tests, consumers challenge purported omissions or misrepresentations regarding PFAS in the labeling and marketing of the tested products. Generally, the claims arise under state common law and consumer protection statutes, and the plaintiffs seek monetary damages based on a benefit of the bargain or price premium theory.
Many industries have been targeted to date, including apparel, cosmetics, food and beverage, personal care, pet food, and cleaning supplies. For affected businesses, these cases implicate a variety of defenses, including questions of preemption, primary jurisdiction, standing, indemnification, and numerous merits-related issues pertaining to the adequacy of the alleged testing, the reasonable consumer standard, and the viability of the claimed damages model.
Nevertheless, given the ubiquity of PFAS in the environment and the potential for unintended migration of PFAS into consumer products, companies throughout the distribution chain may face increased litigation exposure from this growing wave of PFAS labeling and marketing class actions.
For manufacturers, the proposed rules are just the tip of the iceberg. Risks of potential noncompliance abound as new regulations fall into place and the seeds of PFAS litigation grow. Bans impacting the manufacture and distribution of products are likely not far behind.
While some elements are still unknown, for companies the mission forward is clear: determine what PFAS may be in products, processes, and waste streams and develop strategies to ensure compliance with new regulations, now and in the future.
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