> The three companies said they have agreed to contribute a total of $1.185 billion to a settlement fund. Chemours will contribute 50 percent (about $592 million), and DuPont and Corteva will together contribute the remaining 50 percent, at about $400 million and $193 million, respectively.
When a payout like this occurs, does it mean the problem is resolved? In other words, are these companies no longer putting out toxic chemicals, or are they buying the ability to continue to do that without fear of further lawsuits?
> In a statement, Dupont said it “has never manufactured PFOA or PFOS.” CNN has reached out to the other companies for comment on the allegations, which they denied in a press release Friday.
Then there would be no evidence, which would mean the court case would be thrown out / one-sided. Instead they settled for a large amount of money. Does that not make you raise your eyebrows?
DuPont has a complicated corporate history. Chemours, one of the other companies in the settlement, is the division that made Teflon. Corteva was also part of DuPont (and Dow). It may be technically true that none of the business units currently in DuPont made anything bad.
I think it will likely be this - I'm already seeing all sorts of companies pivot to marketing "PFOA" free teflon alternatives (Starflon was the one that popped up last).
I suspect that just like the whole BPA in plastic thing - the "___ free" alternatives will not be any better.
They will just be sidestepping the very precise legal definition of the chemical that got them in trouble.
Either that or it will be like gluten-free, and you'll start seeing it slathered all over stuff that never had it in the first place. Like, no duh non-flavored sparkling water is gluten free! (Actual example I saw in the grocery store today)
If you've got celiac, you may want to avoid sparkling water made in a plant that also bottles wheat beers. Gluten free refers not only to the ingredients, but to the manufacturing facility.
Yeah I immediately just assumed they manufactured them "through" a "subsidiary." Like how you can manufacture carcinogenic talcum powder and not pay your victims much of anything.
I am aware that companies sometimes settle cases where they are in the right in order to avoid legal fees, but the idea that Dupont paid $400M in this settlement despite having not manufactured the chemicals in question is absurd.
If they thought they weren't liable then they would have fought this in court.
PFAS technology was top secret WW2 research output. Then the military discovered that they had amazing properties to fight extremely dangerous fires in missile warehouses and were eventually required to use them to maximize safety decades ago.
Prozac, Lipitor, Flonase and about 30% of upcoming new pharmaceutical drugs are PFAS, so they aren't going away completely, because society has determined that they are valuable even if they can reach toxic levels if not disposed of properly (every chemical is toxic after a certain human concentration, including water).
Companies wouldn't be able to manufacture semiconductors without PFAS as well, or high temperature components for warfare.
Now that we are smarter, we know how to mitigate risk and reduce concentrating materials to keep below relevant ppb thresholds.
If America isn't educationally sophisticated enough to handle this manufacturing and risk, it will just be done in zero regulation geographies like China and the world will be worse off.
What about we first find out how much of it is actually toxic (which seems rather 1/1000th of current official numbers) and then start using them in processes which actually respects that? It still doesn't cover accumulation in bodies over time though.
You don't gain any longterm competitive advantage by poisoning half of your population, giving them wonderful cancers, infertility, massive amount of birth defects etc. You just destroy society and bankrupt medical insurance.
This isn't some economics and plying with abstract numbers, these are people out there and messing this up badly will have massive negative impacts for many generations.
Look at these numbers, extrapolate them to the decades they've been in business, and then compare them to DuPont's payment here of $400 million. The numbers aren't even close.
The cost for anything like this should always be the cost of cleaning up the entire mess it created and compensating the humans harmed by it and covering their lifetime medical bills. $1billion sounds a tad low for doing any of that given the world wide impact. Its a bad deal.
Yeah, it's a "make the victims feel like they got some justice" money but not anywhere near enough to actually solve the problem or to repay the damages.
They're basically getting off scott free, and they made tens of billions of dollars in profit for only having to pay 1 billion in damages.
Justice served would be jail time for execs or a corporate death penalty. Levying a fine means it's just a cost of doing business. And a billion dollars sounds like a lot, but it's a drop in the bucket for these massive multinational corporations that have been in business for decades.
So, no more Kevlar for police protection? The problem with the idea of a corporate death penalty is that it would shutter the corporation, shock the supply chain for critical materials, terminate the employment of thousands of people, and devastate their communities (e.g. because employees have families and those families consume food and stuff from the local economy which, in turn, supports other families).
It's obvious why we haven't adopted it as a viable punishment.
There are tons of Kevlar alternatives, on cca same level of performance these days. Just because some company made a good product once or twice will make them invincible against the law with all the rest they ever did?
You forgot 'think about the children' part, but in this case, it actually goes against that fucked up corporations. We may have to see half of our kids infertile in a decade or two and shitload of birth defects that can bankrupt any health services (in case of US rather half of population), no amount of thinking about Kevlar or Goretex (for which there are tons of great alternatives too and I stopped using their stuff in mountains long time ago) is going to fix that
Nah, the assets would be auctioned off. The shareholders would be screwed. But the employees would largely stick around and do stuff under new ownership. It would still be a shock, but after a few of these you'd see investors not willing to allow that kind of thing to happen because it's a huge financial risk to them. Not a great solution, but also not as ruinous as you might think. Companies shouldn't be "too big to fail" and most aren't.
The shareholders aren't the ones manufacturing the PFAS. I think that I want the operating unit to be halted and dismantled. Not the shareholders, management, or other units. So, I don't think Chapter 11 is the right solution.
Will it solve the problem though? Assets & IP would be auctioned off. Shell companies would be formed to handle liability. The problem lies with the people who made the decisions that led to the toxic materials being discharged into the environment & the people harmed.
A Chapter 11 would allow the same staff who caused the problems to join the new companies. Unless the people who caused the problems are personally & criminally held liable, nothing would change.
The idea is the owners/shareholders get punished. If we punish them, they'll stop hiring criminally negligent C-suites.
I'd prefer we do both. Hold the actual bad actors accountable AND also kill the company and hurt the shareholders. Anybody involved needs to have incentive to stop the bad behavior.
I'm tired of people using corporate shells as a get-out-of-jail card when they do things that are illegal and/or knowingly bad for society/environment.
> If we punish them, they'll stop hiring criminally negligent C-suites.
I sympathize with your frustration, but this statement implies a Minority Report level of knowledge of the future. What happens when executives become negligent after being hired? Are shareholders still to blame? What happens when some activity that wasn't known to be unacceptable becomes known to be unacceptable?
The shareholders willingly take a financial risk in pursuit of wealth. The people in the public harmed by the corporate actions did not willingly accept the risk to their health. The public people harmed were victimized by the corporation & the people involved with the corporation. If the shareholders have skin in the game, they will be more motivated to ensure that the corporation does not endanger the public in any way. The officers' fiduciary duty becomes aligned with public safety as well.
If the shareholders are simply chasing the bottom line without regard to the consequences of the company they invested in, there is no incentive to maintain public safety. History has shown what happens...companies repeatedly harm the public with a relatively minor punishment which is less than the money they made off of harming the public, if the company is punished at all.
Corporations are chartered for the betterment of society. If a corporation is harmful to society, anyone involved with those actions should be aggressively removed from society under criminal statute, with even greater fervor then prosecuting a murderer, rapist, or any other criminal who impacts less people than corporate criminals.
> The shareholders aren't the ones manufacturing the PFAS.
True. They're just bankrolling it. I think it's totally fair to hold them responsible as well. Perhaps it would make investors pay more attention to what they're really supporting with their investment money.
> It's obvious why we haven't adopted it as a viable punishment.
But we did. It used to be a tool that was implemented when a corporation behaved egregiously badly. At some point, though, we stopped (I think it was in the 40s, but I'm not sure).
We really, really need to bring it back. There is no other way to hold them in check.
Perhaps the death penalty for the execs would cause some real reform. Japanese culture had the concept to Seppuku when someone brought shame to their position. They seem to take their jobs seriously.
Back when I was 19 and an anarchist, I was always critical of LLC laws. I probably still am.
I believe the judicial system does do the fine as you mentioned, but the prosecutors have to be realistic and settle out of court at the risk a skeptical judge/jury.
Without LLC laws, you could go after personal ownership too. Privately owned company means there is a few billionaires to have their wealth confiscated. Publicly, our 401ks empty + risk of losing our homes.
Isn't that insane to think about? What would a world look like if that was the case. Would companies be incredibly responsible? Would investors be incredibly responsible?
I don't claim to say this is the best economic system, but it might solve our climate crisis by forcing people to be liable for themselves and what they own.
I wonder if we could have fractional death penalty. Some lifetime counter on your responsibility of deaths by companies you own. When certain threshold let's say 0.5 is reached, it will be carried out when ever you are apprehended.
I'm not sure that the LLC laws are exactly the problem.
I think it's the fact that you can get a company incorporated to do pretty much a vague _anything_ is the problem. There should be an ounce of thought by the State as to if what the person wants a company for is actually useful for society before granting them immunity.
The second major issue is that the State is never willing to dissolve a company once it reaches some size no matter how much wrong doing it does. Like Walls Fargo willfully creating fake accounts to charge consumers money should've just be an instant disqualification for a banking license.
First, a corporation can’t do anything that an individual can’t do.
Second, incorporation does not protect the business, it protects investors. Without it, investors would be general partners and would be personally liable for anything the business does, including all debts and torts, even if they had no active role in running the business.
Third, where owners of a corporation or LLC do participate in running a business, they often can be held personally liable for the debts and torts of the business. This is called “piercing the corporate veil” and happens all the time in lawsuits against small businesses.
> First, a corporation can’t do anything that an individual can’t do.
The problem is not that a corporation can do something that an individual can't. It's that you can't punish a corporation the same way you can an individual. Corporations cannot sit in a jail cell.
> Second, incorporation does not protect the business
Your Third point kinda disproves this. You have to "pierce the corporate veil" in order to hold individuals of the LLC liable and this is generally w.r.t. an LLC commingling its funds with the owners funds. Not to do with an Owner doing an undesirable/illegal act (say fraud).
> Third, ... happens all the time in lawsuits against small businesses.
I'm not really sure any of these points counter-act anything I wrote. I explicitly called out Wells Fargo and you responded that small business routinely get attacked. Wells Fargo is not a small business.
Any person who commits a crime on behalf of their employer can and should be held criminally liable. That the employee was instructed to do so by his manager will not prevent his conviction, it will only be evidence that the manager should also be held criminally liable.
Veil-piercing is relevant when the business is insolvent or can’t pay the judgment. So the corporate entity isn’t protecting the business in that case.
Re Wells Fargo, would you hold ordinary shareholders who do not participate in the management of the business liable for debts of or crimes committed by Wells Fargo?
> investors would be general partners and would be personally liable for anything the business does, including all debts and torts, even if they had no active role in running the business.
I think it would be a better world if investors were held responsible for the wrongdoings of the businesses they finance.
Individuals and small businesses generally don't get great protection from LLC/incorporation and they get along just fine (when the owners are directly involved in running the business, it becomes much easier to pierce the veil).
IMO, what really needs to be reigned in is this blanket extension of natural/individual rights to synthetic entities that receive limited liability protection. That government-granted charter with limited liability means that they're not merely groups of people exercising individual rights collectively, as the supreme council has decreed.
i'm reading these are used everywhere, pretty much like plastics :(
i really think this problem is out of our hands, i wonder how much time we have until the food and water has so much plastic and forever chemicals that it isn't safe to eat anymore
This is only to cover damage to the drinking water (and excludes any drinking water supplied by state or federal governments). More lawsuits or settlements can concern themselves with damage to the environment.
As for if that is a trivial amount for what they are paying for, I don't know.
Yes. It's an absolute steal of a price to pay for something that persists in the environment. It seems like a big number to people who live off a paycheck but if you compare it to a project like a section of highway construction or an airport or whatever you quickly see that this is no penalty. Put another way, an NBA basketball franchise is worth 2.86 billion on average. The penalty is basically 1/3rd of a pro level basketball franchise.
Seems kinda low given the scope and bets that amount a) gets substantially reduced later on and b) will be claimed as business expense so will have a even lesser net effect. Its just minor inconvenience for them.
82 comments
[ 5.0 ms ] story [ 146 ms ] thread> The three companies said they have agreed to contribute a total of $1.185 billion to a settlement fund. Chemours will contribute 50 percent (about $592 million), and DuPont and Corteva will together contribute the remaining 50 percent, at about $400 million and $193 million, respectively.
How can they stop something they never did
https://www.dupont.com/position-statements/pfoa.html says "While we no longer make PFOA..."
The "we no longer" could be referring to "the US" as "we", since they talk about the FDA outlawing it. So DuPont never made PFOA.
"Manufacture" might be used in the chemical industry only refer to creating products. And DuPont was earlier in the supply chain.
Or, even more upstream, DuPont may have made precursor chemicals that other people mixed into the final PFOA.
Maybe they "synthesized" them, not "manufactured"
Maybe they bought them from some other company (which they might happen to own)
Maybe they manufactured PFAs in general, but not the specific chemicals PFOA or PFOS (it's an awfully specific statement, after all)
I suspect that just like the whole BPA in plastic thing - the "___ free" alternatives will not be any better.
They will just be sidestepping the very precise legal definition of the chemical that got them in trouble.
So something that seems like it'd trivially not contain X may actually have X.
If you've got celiac, you may want to avoid sparkling water made in a plant that also bottles wheat beers. Gluten free refers not only to the ingredients, but to the manufacturing facility.
https://celiac.org/main/wp-content/uploads/2017/07/Combined-..., point #6.
> "The gluten-free label represents that the procedures put in place to prevent cross-contact with gluten meet FDA standards."
If they thought they weren't liable then they would have fought this in court.
This is not accountability for infecting the worlds population with these nasty chemicals.
Prozac, Lipitor, Flonase and about 30% of upcoming new pharmaceutical drugs are PFAS, so they aren't going away completely, because society has determined that they are valuable even if they can reach toxic levels if not disposed of properly (every chemical is toxic after a certain human concentration, including water).
Companies wouldn't be able to manufacture semiconductors without PFAS as well, or high temperature components for warfare.
Now that we are smarter, we know how to mitigate risk and reduce concentrating materials to keep below relevant ppb thresholds.
If America isn't educationally sophisticated enough to handle this manufacturing and risk, it will just be done in zero regulation geographies like China and the world will be worse off.
https://en.m.wikipedia.org/wiki/Fluoxetine
But I’m unsure the line where perfluoralkylated is reached. I’d think if the compound had alkylated chains instead of a fluorine-linked head group.
You don't gain any longterm competitive advantage by poisoning half of your population, giving them wonderful cancers, infertility, massive amount of birth defects etc. You just destroy society and bankrupt medical insurance.
This isn't some economics and plying with abstract numbers, these are people out there and messing this up badly will have massive negative impacts for many generations.
Society never decided this one way or another. Rich and powerful corporations did.
Look at these numbers, extrapolate them to the decades they've been in business, and then compare them to DuPont's payment here of $400 million. The numbers aren't even close.
They're basically getting off scott free, and they made tens of billions of dollars in profit for only having to pay 1 billion in damages.
So, no more Kevlar for police protection? The problem with the idea of a corporate death penalty is that it would shutter the corporation, shock the supply chain for critical materials, terminate the employment of thousands of people, and devastate their communities (e.g. because employees have families and those families consume food and stuff from the local economy which, in turn, supports other families).
It's obvious why we haven't adopted it as a viable punishment.
You forgot 'think about the children' part, but in this case, it actually goes against that fucked up corporations. We may have to see half of our kids infertile in a decade or two and shitload of birth defects that can bankrupt any health services (in case of US rather half of population), no amount of thinking about Kevlar or Goretex (for which there are tons of great alternatives too and I stopped using their stuff in mountains long time ago) is going to fix that
A Chapter 11 would allow the same staff who caused the problems to join the new companies. Unless the people who caused the problems are personally & criminally held liable, nothing would change.
I'd prefer we do both. Hold the actual bad actors accountable AND also kill the company and hurt the shareholders. Anybody involved needs to have incentive to stop the bad behavior.
I'm tired of people using corporate shells as a get-out-of-jail card when they do things that are illegal and/or knowingly bad for society/environment.
I sympathize with your frustration, but this statement implies a Minority Report level of knowledge of the future. What happens when executives become negligent after being hired? Are shareholders still to blame? What happens when some activity that wasn't known to be unacceptable becomes known to be unacceptable?
The shareholders willingly take a financial risk in pursuit of wealth. The people in the public harmed by the corporate actions did not willingly accept the risk to their health. The public people harmed were victimized by the corporation & the people involved with the corporation. If the shareholders have skin in the game, they will be more motivated to ensure that the corporation does not endanger the public in any way. The officers' fiduciary duty becomes aligned with public safety as well.
If the shareholders are simply chasing the bottom line without regard to the consequences of the company they invested in, there is no incentive to maintain public safety. History has shown what happens...companies repeatedly harm the public with a relatively minor punishment which is less than the money they made off of harming the public, if the company is punished at all.
Corporations are chartered for the betterment of society. If a corporation is harmful to society, anyone involved with those actions should be aggressively removed from society under criminal statute, with even greater fervor then prosecuting a murderer, rapist, or any other criminal who impacts less people than corporate criminals.
True. They're just bankrolling it. I think it's totally fair to hold them responsible as well. Perhaps it would make investors pay more attention to what they're really supporting with their investment money.
But we did. It used to be a tool that was implemented when a corporation behaved egregiously badly. At some point, though, we stopped (I think it was in the 40s, but I'm not sure).
We really, really need to bring it back. There is no other way to hold them in check.
I believe the judicial system does do the fine as you mentioned, but the prosecutors have to be realistic and settle out of court at the risk a skeptical judge/jury.
Without LLC laws, you could go after personal ownership too. Privately owned company means there is a few billionaires to have their wealth confiscated. Publicly, our 401ks empty + risk of losing our homes.
Isn't that insane to think about? What would a world look like if that was the case. Would companies be incredibly responsible? Would investors be incredibly responsible?
I don't claim to say this is the best economic system, but it might solve our climate crisis by forcing people to be liable for themselves and what they own.
I think it's the fact that you can get a company incorporated to do pretty much a vague _anything_ is the problem. There should be an ounce of thought by the State as to if what the person wants a company for is actually useful for society before granting them immunity.
The second major issue is that the State is never willing to dissolve a company once it reaches some size no matter how much wrong doing it does. Like Walls Fargo willfully creating fake accounts to charge consumers money should've just be an instant disqualification for a banking license.
Second, incorporation does not protect the business, it protects investors. Without it, investors would be general partners and would be personally liable for anything the business does, including all debts and torts, even if they had no active role in running the business.
Third, where owners of a corporation or LLC do participate in running a business, they often can be held personally liable for the debts and torts of the business. This is called “piercing the corporate veil” and happens all the time in lawsuits against small businesses.
The problem is not that a corporation can do something that an individual can't. It's that you can't punish a corporation the same way you can an individual. Corporations cannot sit in a jail cell.
> Second, incorporation does not protect the business
Your Third point kinda disproves this. You have to "pierce the corporate veil" in order to hold individuals of the LLC liable and this is generally w.r.t. an LLC commingling its funds with the owners funds. Not to do with an Owner doing an undesirable/illegal act (say fraud).
> Third, ... happens all the time in lawsuits against small businesses.
I'm not really sure any of these points counter-act anything I wrote. I explicitly called out Wells Fargo and you responded that small business routinely get attacked. Wells Fargo is not a small business.
Veil-piercing is relevant when the business is insolvent or can’t pay the judgment. So the corporate entity isn’t protecting the business in that case.
Re Wells Fargo, would you hold ordinary shareholders who do not participate in the management of the business liable for debts of or crimes committed by Wells Fargo?
I think it would be a better world if investors were held responsible for the wrongdoings of the businesses they finance.
IMO, what really needs to be reigned in is this blanket extension of natural/individual rights to synthetic entities that receive limited liability protection. That government-granted charter with limited liability means that they're not merely groups of people exercising individual rights collectively, as the supreme council has decreed.
i really think this problem is out of our hands, i wonder how much time we have until the food and water has so much plastic and forever chemicals that it isn't safe to eat anymore
As for if that is a trivial amount for what they are paying for, I don't know.
Once again, these huge corporations are destroying the world for profit and getting away with it.