The proposed EPA rule designating PFOA and PFOS as hazardous substances under CERCLA has significant implications for Potentially Responsible Parties (PRPs) at both current and closed Superfund sites, as well as for companies involved in Brownfields¹ redevelopment and land acquisition. The focus on environmental justice (EJ) by EPA and other federal agencies will increase agency scrutiny of sites where PFAS compounds have been detected in soil or groundwater and will empower nearby EJ communities to advocate for increased monitoring, lower clean-up standards, and even to reopen closed sites.

For open sites undergoing environmental investigation and remediation, the agencies can be expected to add PFOA and PFOS to the list of compounds to be investigated and remediated, and EJ groups can be expected to advocate strongly for them to do so. Given the ubiquitous nature of these compounds in the environment, the extremely low action levels being proposed, and the difficulty and expense of remediation for these compounds, companies can expect the scope of investigation and remediation costs to increase substantially. This, in turn, is likely to increase the stakes for contribution litigation, as well as the number of parties involved, given the many uses of PFAS compounds in a wide variety of industries and products. Since toxic tort suits often follow, the tort exposure of site PRPs and defendants in contribution litigation is likely to expand, especially given the adverse publicity of these so-called “forever chemicals” and the rise of EJ as a theme of such suits and as a recruiting tool for plaintiffs.

With respect to sites that have received regulatory closure, contribution protection in consent decrees or CERCLA settlements may not cover PFOS and PFOA. As a result, state or federal agencies could exercise reopeners at settled sites under a consent decree or could prompt a new round of agency investigation and oversight to include PFOA and PFOS. EJ groups could advocate for reopening those sites to investigate PFOS and PFOA, and to change the risk-based remedial standards that led to a site closure decision by the agencies. Current property owners, real estate entities seeking to purchase Brownfield sites for redevelopment, and past owners/operators who got regulatory closure could all be exposed to new liability (and new hurdles in the permitting process) as a result of the inclusion of PFAS compounds as hazardous substances. This will likely lead to heavy scrutiny of the scope and limitations of site closure decisions and any reopeners in agency consent decrees, as well as the releases, indemnities, and representations and warranties in settlements and property acquisition agreements. These issues highlight the need for increased due diligence in transactions with a real estate component, and a new focus on properly drafted language in settlements, consent decrees and acquisition agreements to protect against this exposure.

¹ “Brownfields” sites are those with a previous history of contamination and remediation under agency oversight that have received—or are close to receiving—regulatory closure from the oversight agency. Such regulatory closures are often made under a “commercial and industrial” risk standard that leaves some contaminants if they are below human health risk standards for the specified use. These sites are often attractive to developers who intend to convert otherwise vacant properties to productive use.