Industry Groups Oppose EPA’s PFAS Rule in Legal Challenge

In April 2024, EPA finalized a rule to designate perfluorooctanoic acid (“PFOA”) and perfluorooctanesulfonic acid (“PFOS”) as hazardous substances under the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”). The designation was intended to provide EPA greater power to clean up sites contaminated with these substances. This was the first designation for any per- and polyfluoroalkyl substances (“PFAS”). The D.C. Circuit recently granted EPA’s request to stay a legal challenge that was filed last June so that the new administration can have time to determine how to proceed with the rule. See Doc. Nos. 2100170, 2102403, Chamber of Commerce v. EPA, No. 24-1193 (D.C. Cir. 2024).

Industry groups assert three main arguments in support of their Petition for Review. First, they argue that EPA misinterprets the standard for deeming a substance hazardous, making such a designation based on whether “there’s any ‘possibility’ it could harm humans, animals, or the environment.” Petitioners’ Br. 32. According to opponents of the designation, EPA’s reading of the rule is a “blank check” to designate substances as harmful since “almost any substance,” even salt, “could clear this minimal bar.” Id. Second, EPA’s evaluation of costs was flawed, because it ignored certain categories of costs altogether, “drastically underestimated others, and mistook some costs for benefits.” Id. at 40-41. Third, EPA failed to assess the widespread consequences, such as unintended impacts on real estate transactions, and thus was arbitrary and capricious. Id. at 71-78.

In its brief, filed before the change in administration, EPA countered that it acted within its authority to regulate substances that “may” present a substantial danger to public health or the environment. EPA’s Br. 28-39. The agency further argued that the precautionary nature of the permissive standard accorded with the statutory design, and here EPA reasonably weighed the advantages and disadvantages of the hazardous-substance designation and looked to scientific judgments and reasonable predictions about the impact of such a designation. EPA also contends that it made reasonable “illustrative” cost estimates in its analysis, explaining its basis for disagreeing with certain costs posited by the industry groups. Id. at 54-62. Further, to the extent the industry groups are concerned about unintended consequences, EPA had previously explained why it believed that “CERCLA would continue to function normally” for this designation as it has previously for other substances. Id. at 64. In mid-February, a group of public health and environmental organizations filed a separate brief as intervenors, adopting and supplementing EPA’s arguments.

Pursuant to the stay, EPA is required to file a motion to govern future proceedings on April 25. Doc. No. 2102403. With the significant uncertainty surrounding the law, those that may be affected by the rule, including companies that may have used PFAS, should stay apprised of future developments.