Microplastic Claims: Litigation Under the Clean Water Act and RCRA, Claims Brought in Derivative Lawsuits

Microplastics are now believed to exist everywhere, including in our water and food supplies. The long-term effects of microplastic ingestion on human health are currently unknown. In September 2019, the World Health Organization stated that microplastics "don’t appear to pose a health risk at current levels," but cautioned that the available information was limited and more research was needed to determine how microplastics impact human health.

The most common microplastic pollution claims are brought under the CWA. Recently, claims filed in federal court allege that Formosa--an international manufacturer of resins and petrochemicals--violated its CWA permit, which prohibits the "discharge of floating solids or visible foam other than in trace amounts." Armed with photographic, video footage, and water sample evidence, the plaintiffs argued Formosa violated its CWA permit by discharging plastic pellets and PVC powder into a surface water body. Formosa's unsuccessful defense relied upon the language of the CWA permit, arguing that because the permit itself did not specify a weight or concentration for the alleged discharge, there could be no discernible violation.

Plaintiffs have also successfully brandished filed claims under RCRA, the federal statute aimed at regulating hazardous solid waste. Cases have alleged that plastics transporters wrongfully discharged plastic pellets into a number of surface water bodies, violating the CWA by discharging into navigable waters, but claiming that the discharge of the plastic pellets itself amounts to solid waste. Thus, the plastics transporter created an "imminent and substantial endangerment" to human health and the environment, which is an express cause of action under RCRA.

One final avenue to pursue claims has come from shareholder derivative suits filed by shareholders alleging that a company exaggerated or misled the owners regarding the company's environmental liability. In October 2021, a shareholder of Danimer Scientific Inc.--a manufacturer of polymers, resins, and plastic alternatives used in a variety of plastic products--filed a shareholder derivative suit alleging the company overstated its sustainability claims, resulting in millions of dollars in market capitalization losses. The plaintiff pursued litigation against Danimer's CEO, CFO, and company directors for breaching their fiduciary duties to the company by intentionally and/or recklessly allowing false representations to be made causing significant losses.

Listen as our authoritative panel addresses the entire menu of potential liability in microplastics, what manufacturers should consider, and the best practices.

1. Microplastic litigation
2. Clean Water Act
   1. Recent cases
3. Resource Conservation and Recovery Act
   1. Recent cases
4. Derivative shareholder suits
5. Other microplastic litigation
6. Manufacturer's risk mitigation

The panel will address these and other key issues:

• How are claims under the CWA for microplastics most likely pursued?
• What must a manufacturer show to avoid liability under RCRA?
• What should boards and management consider when making environmental sustainability claims to avoid derivative suits?