A rash of recent lawsuits against 3M have intensified concerns that it could face massive legal and cleanup costs over a class of chemicals called PFAS.
More are in the pipeline.
3M has set aside an additional
"You can kind of see at its infancy how this could become a very large problem," said
PFAS chemicals have been found in streams, rivers, military bases and in the drinking water of 1,361 sites across the
While the lawsuits weave through the system, governments at municipal, state and federal levels have introduced new restrictions or elevated the pollution status of PFAS. In one
While 3M isn't the only firm that made or used PFAS --
3M is aggressively fighting many of the increased liability claims -- and also more stringent regulations and legislation regarding PFAS. 3M attorneys told
It also "placed thousands of documents in the public domain, including more than 150 published studies conducted by 3M and other researchers on potential environmental and health effects of PFAS," said spokeswoman
The company, Haile-Selassie said, will not speculate on 3M's potential liabilities.
As the court cases and the advocacy for the government to increase regulations intensifies,
Of the 19 analysts tracked by Reuters that cover 3M, only three rated the company a "buy" or "outperform." This month both
Citigroup research analyst
"Our discussions with legal experts indicate that the remediation [and] cleanup costs -- per severe state -- could be [as much as
In July, a shareholder lawsuit accused 3M and its officers of hiding the company's PFAS woes in order to artificially inflate the stock price -- an assertion 3M strongly disagrees with, Haile-Selassie said.
As concerns have mounted,
It has been 70 years since 3M made its first nonstick, waterproof and stain-resistant chemical ingredients for Scotchgard, Teflon and eventually fluorinated firefighting foams. Environmentalists call PFAS the "forever chemicals" because they don't break down and instead linger in soil, water and human blood.
3M stopped making two key PFAS compounds -- PFOA and PFOS -- back in 2002 and switched to shorter chain compounds, which it claims are safe. The company also has spent years cleaning up its PFOA and PFOS factories and dump sites in
The growing problem worries environmentalists, cities and plaintiffs who point to the results of a published study that monitored the health of 16,000 West Virginians exposed to PFAS-contaminated water between 2005 and 2013.
While states march to court -- and some like
More than 40 bills have been introduced in
Even so, product liability experts note that most PFAS lawsuits just mention health risks but largely complain about sizable environmental damage. That's because it's easier to prove chemicals are in city drinking water than to prove that PFAS -- and only PFAS -- caused a person's specific disease, attorneys note.
Until "more is definitively known about the scientific health effects of PFAS," litigants will probably opt for environmental and product liability litigation, said
Inch at Gordon Haskett said the fallout from PFAS lawsuits or any Superfund designations could span decades. If so, that "silver lining" of time would help 3M manage what is expected to be an expensive problem.
"While 3M is at risk for a large PFAS liability, we think it is manageable over time," Obin wrote.
The latest attempt to elevate PFAS to Superfund status did not make it through a bipartisan conference committee finalizing the defense spending bill that was passed last week.
Many litigants are now preparing for trials that start in 2020 or 2021.
Fire foams are the fastest growing environmental lawsuits against 3M,
Another judge will decide next month if he'll allow a similar PFAS medical monitoring lawsuit by thousands in
With so many issues erupting, potential "damages can ramp up quickly," said Kelso at
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