Moody’s Says PFC Lawsuits a Risk to DuPont and Chemours
A heightened level of litigation risk is facing DuPont and Chemours (the former Performance Materials segment of DuPont) as a consequence of new cases filed in the US states of North Carolina and Ohio on the contamination of water supplies by perfluorochemicals (PFCs), according to a report by ratings agency Moody’s Investors Service.
Although DuPont’s fluorochemicals business is now part of Chemours, Moody’s said both companies could be liable for damages. However, although the agency views the latest litigation as negative to the companies’ credit profiles, it said there is no impact on their ratings at the moment.
“While we believe both companies face a heightened level of litigation risk from these lawsuits, and that risk might be further exacerbated by negative public relations, it is difficult to know with certainty if the lawsuits will result in a meaningful liability,” Moody’s said, adding that it believes the situation has the potential to be relevant for “a number of years to come”.
One of the cases in North Carolina relates to PFC discharges in the Cape Fear River, near Fayetteville. Earlier this month, lawyers filed suit against DuPont and Chemours on behalf of 100 North Carolina residents who claim that drinking water contaminated with “GenX” fluorosurfactant and its predecessor perfluorooctanoic acid (PFOA), may have impaired their health.
A second lawsuit, which consolidates three previous existing suits, is seeking damages relating to illegal discharges of PFCs from the former DuPont plant at Fayetteville (now owned by Chemours) that is claimed to have poisoned regional wells along with public drinking water supplies drawn from the Cape Fear River.
In Ohio, a case has been filed against both US companies relating to discharges into the Ohio River downstream from a plant in Parkersburg, West Virginia.
In February 2017, DuPont and Chemours agreed to jointly pay $670.7 million in cash to settle out of court around 3,550 personal injury lawsuits related to discharges of perfluorooctanoic acid (PFOA) from the Parkersburg facility.
Just last month, US conglomerate 3M agreed to pay $850 million to settle a PFOA-related lawsuit in Minnesota. The state alleged that the company had been dumping industrial chemicals in the Minneapolis-Saint Paul metropolitan area since the 1950s. Moody’s said the suit is ‘potentially analogous’ to those against DuPont and Chemours.
3M is said to be facing at least another 24 similar groundwater pollution lawsuits in US courts, some of which include claims for personal injury and property damage.