Chemours, DuPont and Corteva have agreed to pay $875 million over 25 years to the State of New Jersey to settle environmental claims including pollution linked to PFAS, or "forever chemicals", the companies said on Monday.
Lawsuits accusing major chemical companies of polluting U.S. drinking water with toxic PFAS chemicals led to over $11 billion in settlements in 2023, with experts predicting that new federal regulations and a growing awareness of the breadth of the contamination will spur more litigation and settlements.
PFAS are a class of chemicals that are used in a wide range of products including non-stick cookware and firefighting foams. They are commonly called "forever chemicals" as these substances do not break down easily in the human body or nature, and are associated with certain cancers, hormonal dysfunction and other diseases.
The payments announced on Monday, whose present value is about $500 million before taxes, will start no earlier than January 1, 2026.
Chemours will make half of the settlement payments, while DuPont will pay 35.5% and Corteva the rest, the companies said in a statement.
In 2023, the three firms reached a settlement agreement with the U.S. state of Ohio for $110 million to resolve claims associated with PFAS.
That same year, 3M agreed to pay $10.3 billion to settle hundreds of claims that the company polluted public drinking water with the chemicals, while Chemours, DuPont and Corteva reached a similar deal with U.S. water providers for $1.19 billion.
Of the total settlement announced on Monday, $16.5 million is attributed to alleged PFAS contamination unrelated to the companies' operating sites.
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NEWS RELEASE
WILMINGTON, Del. -- The Chemours Company (NYSE: CC), DuPont de Nemours, Inc. (NYSE: DD), and Corteva, Inc. (NYSE: CTVA) (the "Companies") announced a settlement to comprehensively resolve all pending environmental and other claims by the State of New Jersey against the Companies in various litigation matters and other state directives. The Settlement will resolve all legacy contamination claims related to the companies' current and former operating sites (Chambers Works, Parlin, Pompton Lakes and Repauno) and claims of statewide PFAS contamination unrelated to those sites, including from the use of aqueous film forming foam.
Settlement payments will total $875 million over a 25-year period beginning within 30 days of the Judicial Consent Order ("JCO") entry date, which will be no earlier than January 1, 2026. Of the total settlement amount, $16.5 million is attributed to alleged PFAS contamination unrelated to the Companies' operating sites, including AFFF of $4.125 million. The pre-tax total present value of the settlement payments is about $500 million, based on the discount rate set forth in the JCO for purposes of prepaying settlement amounts.
Consistent with the January 2021 Memorandum of Understanding between the parties ("MOU"), Chemours will be responsible for 50% of settlement payments, or approximately $250 million on a present value basis, DuPont will be responsible for 35.5% of settlement payments, or approximately $177 million on a present value basis, and Corteva will be responsible for the remaining 14.5% of settlement payments, or approximately $72 million on a present value basis.
The settlement also establishes a process for determining the amount of the Remediation Funding Source ("RFS") at the four current and former operating sites and the initial range for each, as well as other mechanisms to secure future remediation at the sites. The RFS will be secured by a surety bond or similar instrument. In addition, DuPont and Corteva will establish a Reserve Fund based on their respective cost sharing percentages, capped at $475 million, also through a surety bond or similar instrument, to serve as further financial security, separate from and secondary to the RFS. The Reserve Fund will be accessible only under limited conditions detailed in the settlement. The RFS and Reserve Fund do not represent a new cash outlay by the Companies other than the ongoing costs of maintaining the surety bond or a similar instrument to support both.
The terms of the settlement are set forth in a proposed Judicial Consent Order (JCO), which remains subject to notice and comment pursuant to New Jersey law, as well as final court approval.
In addition, and contingent upon approval of the JCO, DuPont and Corteva will purchase from Chemours for $150 million Chemours' rights to receive certain insurance proceeds related to PFAS claims. After DuPont and Corteva have recovered the $150 million, plus a fee, Chemours will be entitled to its 50% share of further insurance recoveries.
