State of MN v. 3M Natural Resource Damages Case Begins

On Tuesday, February 20, 2018, Minnesota’s $5 billion lawsuit against 3M for polluting natural resources will go to trial in Hennepin County district court after years of litigation. Jury selection begins in the case which concerns 3M’s manufacture and disposal of a family of chemical compounds known as perfluorochemicals (PFCs). The trial may last up to six weeks.

 

Background

 

Starting in the late 1940s, 3M began producing PFCs at its plant in Cottage Grove, Minnesota. PFCs are extremely durable chemicals that are resistant to high temperatures. These properties made the chemicals desirable for use in products such as stain repellants, firefighting foam, and nonstick cooking pans. By 2000, products containing PFCs were generating more than $300 million in annual revenue for 3M.

The durability and potential toxicity of the chemicals, however, has led to 3M’s current litigation with the State. Over several decades, 3M legally disposed of PFCs at sites in Minnesota. Locations include: Oakdale, Cottage Grove, and Lake Elmo. Starting in 2000, 3M began phasing out production of the chemicals. By 2002, under and agreement with the U.S. Environmental Protection Agency (EPA), the company had ceased to manufacture most potentially harmful PFCs. But in 2004, the Minnesota Pollution Control Agency (MPCA) discovered that PFCs had leached from disposal sites in Oakdale and Lake Elmo into the groundwater. The chemicals have now generated a 100-square-mile plume contaminating municipal and private wells throughout the affected areas.

 

State of Minnesota v. 3M

 

In December 2010, the State of Minnesota sued 3M in Hennepin County district court, alleging that the release of PFCs harmed the State’s natural resources. Natural resource damages (NRD) claims enable governments to seek compensation for damages to the environment caused by contaminants. NRD compensation is intended to restore the natural environment to its prior condition. And, to compensate the public for lost use of the natural resources.

The State claims 3M knew PFCs were harmful at the time of disposal and that the chemicals were leaching into the groundwater. Further, the State alleges 3M’s own studies showed PFCs were toxic. However, the company failed to report those findings to regulators. The State estimates that 3M caused $5 billion in damages to property values, wildlife, and human health. If the State’s lawsuit is successful, any recovered funds will be used to remediate damage to the affected areas.

3M Denies Allegations

3M denies the State’s allegations and maintains that PFCs present no harm at the levels they are observed in Minnesota. This argument is bolstered by a Minnesota Department of Health report issued days just before the start of the trial. The report shows the Department did not find unusually high rates of cancer or adverse birth outcomes in the communities affected by PFCs. There is currently no scientific consensus regarding safe PFC exposure levels. But, last year the Department of Health set advisory limits are more stringent than those set by the EPA.

Since 2007, 3M has spent millions of dollars cleaning up landfills and ensuring clean drinking water in the areas affected by its PFCs. Under an agreement with the State, 3M has spent more than $100 million on corrective measures including a filtration system for the city of Oakdale’s water supply, bottled water and home filters for affected residents, and a pump system for groundwater in Woodbury.

 

Significance of Minnesota’s Lawsuit

 

Lawsuits for NRD damages are unusual in Minnesota. The State’s $5 billion claim is large when compared to other NRD lawsuits in the United States. For example, following the 1989 Exxon Valdez oil spill in Alaska, ExxonMobil entered a $900 million settlement for NRD damages. In 2008, Montana and the United States settled with the Atlantic Richfield Company for $168 million for injuries to the natural resources in the Upper Clark Fork River Basin. In the largest NRD settlement in Virginia’s history, DuPont agreed to pay nearly $50 million to remediate damages stemming from a release of mercury from the company’s operations in Waynesboro, Virginia.

A class action brought in 2009 by a group of Washington County, Minnesota residents who sought an award for property damage and health claims arising out of 3M’s handling of PFCs was previously dismissed. Thus far, 3M has successfully avoided liability relating to PFCs in similar lawsuits that it is defending in other states. Products made at 3M’s Cottage Grove plant were sold throughout the country and have prompted investigations regarding the health impact of PFCs. If Minnesota’s lawsuit is successful, the case may have significant implications for other PFC lawsuits currently pending across the United States.

 

The State of Minnesota v. 3M trial can be viewed on the CVN network. For information see:  https://cvn.com/proceedings/state-of-minnesota-v-3M-co-trial-2018-02-13

 

Joseph Maternowski, an attorney at the Hessian & McKasy, PA law firm in Minneapolis, represents clients before state and federal environmental agencies and in federal and state court.  He assists clients in minimizing liability on business and real estate transactions.  Mr. Maternowski collaborates with business and real estate attorneys to assist their clients on a range of environmental matters.  He also serves as outside environmental counsel.  Furthermore, Mr. Maternowski has been recognized by his peers as a Best Lawyer for Environmental Law and Environmental Litigation in Minnesota.  He tracks developments in environmental law on his blog.