D.C. Circuit Upholds PFAS Superfund Designations, Raising Liability Considerations for Manufacturers

Manufacturers that have used, processed, discharged, disposed of, or otherwise handled per- and polyfluoroalkyl substances (PFAS) should take note of a significant federal appellate decision affirming the U.S. Environmental Protection Agency’s authority to regulate certain PFAS under the federal Superfund law.

On August 18, the U.S. Court of Appeals for the D.C. Circuit upheld EPA’s 2024 designation of perfluorooctanoic acid (PFOA) and perfluorooctane sulfonic acid (PFOS), including their salts and structural isomers, as hazardous substances under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA). The unanimous decision in Chamber of Commerce of the United States of America, et al. v. EPA rejected challenges brought by industry groups and leaves the designations in place.

For manufacturers, the decision is significant not only because it preserves the existing PFOA and PFOS designations but also because the court endorsed an interpretation of CERCLA Section 102 that affords EPA substantial latitude in determining when a substance may warrant hazardous-substance designation. That reasoning could have implications if EPA seeks to designate additional PFAS or other chemicals in the future.

The Court Rejects a More Restrictive Standard for Hazardous-Substance Designations

CERCLA Section 102 authorizes EPA to designate substances as hazardous when, upon release into the environment, they “may present substantial danger to the public health or welfare or the environment.” EPA relied on that authority for the first time when it finalized the PFOA and PFOS designations in 2024.

Industry petitioners challenged EPA’s interpretation, arguing in part that the agency had failed to establish sufficiently defined boundaries for what constitutes a “substantial danger.” The D.C. Circuit disagreed.

Applying its own interpretation of the statute, the court concluded that Section 102 permits EPA to designate substances where the scientific evidence demonstrates a possible, serious, and real risk of harm upon release. The court emphasized that CERCLA does not require EPA to establish that harm from a particular release is certain to occur.

The decision nevertheless recognizes a limiting principle. According to the court, the statutory requirement of “substantial danger” has “real bite”: the potential harm must be serious and real rather than merely hypothetical. In the case of PFOA and PFOS, however, the court found the record more than sufficient, pointing to studies associating the substances with adverse health effects and EPA’s conclusions regarding their potential carcinogenicity.

For manufacturers, this aspect of the ruling may prove particularly consequential. EPA may be able to rely on a similar scientific and statutory framework if it considers CERCLA designations for additional PFAS or other substances, without first establishing the type of rigid quantitative threshold sought by the industry petitioners.

The Decision Does Not Depend on Deference to EPA

The ruling also provides an important post-Loper Bright signal concerning judicial review of environmental regulations.

Petitioners argued that EPA’s interpretation of CERCLA should receive no deference in light of the Supreme Court’s 2024 decision in Loper Bright Enterprises v. Raimondo, which overruled the longstanding Chevron doctrine. The D.C. Circuit made clear, however, that its decision did not depend on deference to EPA.

Instead, the court interpreted Section 102 de novo and concluded independently that the statutory text supports EPA’s designation of PFOA and PFOS.

That distinction matters. Regulated entities challenging future chemical designations cannot necessarily prevail merely by demonstrating that EPA’s interpretation is not entitled to judicial deference. Where a court independently concludes that CERCLA’s text supports the agency’s interpretation, Loper Bright may provide limited assistance.

Challenges to EPA’s Economic Analysis Also Fail

The court separately rejected challenges to EPA’s consideration of the economic consequences of the designations.

Industry petitioners argued that EPA’s final Regulatory Impact Analysis departed improperly from the economic analysis accompanying the proposed rule and that EPA had inadequately calculated or considered potential cleanup costs, impacts on particular industries and small businesses, federal-site costs, and anticipated benefits.

The court found no procedural defect. It concluded that EPA’s final analysis was a logical outgrowth of the proposal and that revisions made in response to public comments reflected the notice-and-comment process functioning as intended.

Importantly, the court did not decide whether CERCLA Section 102 itself requires EPA to consider costs before designating a hazardous substance. EPA had assumed for purposes of the rulemaking that it should consider costs, and the court likewise assumed the issue without resolving it.

That leaves the legal question open for future rulemakings and challenges.

What the Decision Means for Manufacturers

The immediate consequence is that PFOA and PFOS remain CERCLA hazardous substances. Releases at or above applicable reportable quantities therefore remain subject to federal reporting requirements, and the designations can facilitate EPA cleanup actions and cost recovery under CERCLA.

The longer-term implications may be broader.

The court’s interpretation could provide EPA with a legal roadmap for considering additional hazardous-substance designations. Manufacturers should therefore view PFAS-related CERCLA risk as extending beyond facilities that currently manufacture PFOA or PFOS. Historical use, incorporation into products or processes, waste handling, wastewater discharges, disposal arrangements, acquisitions, and ownership or operation of contaminated property can all warrant closer examination.

CERCLA’s liability framework can reach parties beyond the entity responsible for an initial release, including certain current and former owners and operators and parties that arranged for disposal or treatment of hazardous substances. As a result, legacy PFAS practices may create issues years after the relevant manufacturing activity occurred.

The court also declined to accept predictions that the designations will necessarily produce widespread or disproportionate liability. It pointed to CERCLA’s statutory liability protections, the multiple steps that generally precede cleanup and cost-recovery actions, and EPA’s enforcement discretion. Those observations, however, do not eliminate potential private-party claims, transactional risk, investigation costs, or disputes over allocation of cleanup liability.

Practical Steps for Manufacturers

In light of the decision, manufacturers may wish to reassess their PFAS exposure rather than focusing solely on current PFOA and PFOS use. Among other things, companies should consider:

• Reviewing historical PFAS use. Identify facilities, processes, products, raw materials, coatings, surfactants, firefighting foams, waste streams, and other operations that may have involved PFOA, PFOS, or other PFAS.
• Evaluating disposal and discharge pathways. Examine historical arrangements involving landfills, wastewater treatment systems, waste contractors, recycling operations, and other third-party disposal or treatment locations.
• Assessing potentially contaminated properties. Consider PFAS risks at currently owned facilities as well as former properties where historical operations may create continuing CERCLA exposure.
• Reviewing transactions and contracts. Environmental representations, indemnities, releases, insurance rights, successor-liability provisions, and environmental diligence procedures may become increasingly important in transactions involving PFAS-impacted businesses or properties.
• Preserving historical records. Because CERCLA claims frequently involve operations dating back decades, records concerning chemical purchasing, waste disposal, insurance, corporate structure, and facility operations may become important in establishing defenses or allocating liability.
• Monitoring additional PFAS regulation. The D.C. Circuit’s reasoning may influence EPA’s approach to additional CERCLA designations. Companies that use other PFAS should monitor rulemaking activity and consider participating early in administrative proceedings where their operations may be affected.

Looking Ahead

The decision represents a substantial victory for EPA’s PFAS regulatory program and clarifies that the agency need not demonstrate certainty of harm before designating a substance under CERCLA Section 102. At the same time, the court’s requirement that potential harm be both serious and real provides an important, if fact-dependent, constraint on future designations.

The industry petitioners may seek further review, and EPA’s future approach to PFAS regulation remains subject to policy and administrative developments. For now, however, the ruling strengthens the legal foundation for the existing PFOA and PFOS designations and provides EPA with potentially important precedent if the agency considers expanding the universe of CERCLA hazardous substances.

Manufacturers with current or historical PFAS exposure should consider how the decision affects environmental compliance, legacy liability, waste-management practices, transactions, insurance, and long-term risk management.

For questions about this decision and how it may affect your organization’s PFAS-related compliance, liability, or risk management strategy, contact Michael Blumenthal or any member of Frantz Ward’s Environmental Practice Group.