On March 21, 2024, a federal appeals court ruled the EPA overstepped its authority in ordering Inhance Technologies, LLC, to stop producing per- and polyfluoroalkyl substances (PFAS) during the fluorination of plastic containers.

Background

On December 1, 2023, the EPA issued orders to Inhance, a Houston-based plastics treatment company, directing it not to produce PFAS in the production of its fluorinated high-density polyethylene (HDPE) plastic containers. These containers were used to hold chemicals like cleaning products and pesticides.

PFAS are also known as “forever” chemicals because of the glacially slow pace at which they dissipate in the environment. Traces of these chemicals have been found in the blood of virtually everyone tested over the last 20 years by the Centers for Disease Control and Prevention. They’ve also been linked to a host of health issues, including cancer, immune system deficiencies, negative developmental effects in infants and children, lower fertility rates, and increased cholesterol.

The problem with HDPE containers that include PFAS is that the forever chemicals have been shown to leech into the chemicals in the containers. Then, when the products are used, the PFAS can contaminate groundwater or be ingested by fish.

When the Agency issued the orders, it stated it was acting under the authority of the Toxic Substances Control Act (TSCA) following Inhance’s December 2022 submission of significant new use notices (SNUNs) for nine long-chain PFAS.

Upon review of the SNUNs, the EPA determined three of the PFAS (perfluorooctanoic acid (PFOA), perfluorononanoic acid (PFNA), and perfluorodecanoic acid (PFDA)) are highly toxic and present unreasonable risks that can’t be prevented other than through prohibiting their manufacture. Using the authority of TSCA Section 5(f), the EPA prohibited the continued manufacture of PFOA, PFNA, and PFDA that are produced from the fluorination of HDPE.

“EPA also determined that the remaining six of the nine PFAS chemicals manufactured by Inhance (PFuDA, PFDoA, PFTrDA, PFTeDA, PFHxDA and PFODA) may present an unreasonable risk of injury to health or the environment and, under TSCA section 5(e), is requiring the company to cease manufacture of these chemicals, and to perform additional testing if it intends to restart production,” states the EPA website on its orders to Inhance. “However, Inhance’s current fluorination process for plastics produces all nine of the PFAS chemicals subject to these orders simultaneously, including PFOA, PFNA, and PFDA. Thus, the production of the other six PFAS could not restart so long as the fluorination process continues to produce PFOA, PFNA and PFDA. These orders are effective 02/28/2024.”

Litigation

Inhance sued the EPA. The case worked its way through the legal system until it made its way to the U.S. 5th Circuit Court of Appeals, based in New Orleans.

In a unanimous ruling, the judges agreed with Inhance that the EPA had “exceeded its statutory authority” in ordering the company to stop its current manufacturing process and vacated the EPA’s orders to the company.

“Inhance argues that the EPA exceeded its statutory authority by issuing orders under Section 5 instead of Section 6 because Inhance’s forty- year-old fluorination process is not a ‘significant new use’ under TSCA. We agree,” states the court’s ruling.

TSCA Section 5 covers the regulation of new chemicals.

“The judges said Section 5 of the Toxic Substances Control Act (TSCA) doesn’t apply to the fluorination process Inhance has used for four decades to reinforce plastic packaging, even if it was only recently discovered to inadvertently create [PFAS],” according to Reuters.

Using Section 5 the way the EPA did in this instance “defies common sense,” the ruling states. “Under its approach, the agency can regulate a use under Section 5 anytime it ‘discovers’ a use not previously known to the agency, even if that use has existed for decades. But that reading undermines Section 6 and shortcuts Congress’s express directive to the agency to weigh the costs to businesses and the overall economy before shutting down an ongoing manufacturing process. More simply, the EPA’s interpretation lacks intuitive force: A forty-year-old manufacturing process is not ‘new’ in any pertinent sense of the word. At bottom, the EPA’s attempt to redefine ‘new’ to expand the reach of the SNUR does not pass muster because ‘an agency may not rewrite clear statutory terms to suit its own sense of how the statute should operate.’”

The judges didn’t deny any health risks associated with the containers, but they also didn’t rule on the issues raised regarding byproducts or impurities.

“The court could have concluded that the PFAS in question were both byproducts and impurities and thus exempt from the requirement to submit a SNUN,” according to a National Law Review article by Lynn L. Bergesen of Bergesen & Campbell P.C. “This interpretation alone would have been sufficient to vacate the orders. It is interesting that the court remained silent.

“[It] is unclear whether the decision undermines entirely ‘dead chemical’ SNURs (SNURs that prohibit all manufacturing, processing, and use of a substance). If a COU (condition of use) has been undertaken in the past, but is no longer ongoing, can EPA prohibit that COU under its SNUR authority? One interpretation of the court’s decision is that if a COU has ever been undertaken, regardless of when it was abandoned, that COU cannot be called ‘new’ and therefore cannot be the subject of a SNUR.”

Public Employees for Environmental Responsibility (PEER) and the Center for Environmental Health (CEH) characterized the court’s decision as “flawed” and stated the “decision contains misinformation, overlooks key issues and legal principles, and fails to address compelling arguments by EPA and our groups defending the legality of the challenged orders. … There are several paths forward, and our groups are fully committed to taking all steps available to assure that the Inhance fluorination no longer produces dangerous PFAS which put workers, consumers, and communities at risk.”

Inhance issued a press release stating it was pleased with the ruling and that it “is compliant with all applicable regulations and committed to continuing its significant research and development program to voluntarily implement measures to reduce the potential for unintentional PFAS impurity formation.”

“The company is facing a separate lawsuit from a pesticide maker who claims Inhance concealed its products’ dangers,” The Guardian reports.

As for the EPA, the ball is now back in its court. It will be interesting to see how the Agency reacts.

The court added that “our ruling does not render the EPA powerless to regulate Inhance’s fluorination process. … [The EPA] can properly proceed, abiding the APA’s (Administrative Procedure Act’s) procedural guardrails, under TSCA’s Section 6 by conducting inter alia the appropriate cost-benefit analysis required for ongoing uses — a proposition even Inhance concedes. The EPA is just not allowed to skirt the framework set by Congress by arbitrarily deeming Inhance’s decades-old fluorination process a ‘significant new use.’”