One of ELG’s most impressive accomplishment is its success in litigating MTBE cases against the major oil companies in the United States. Refiners blended methyl tertiary butyl ether (or “MTBE”) into gasoline beginning in the early 1980s despite knowledge that, even when used properly, MTBE would cause widespread groundwater contamination. As the companies predicted, MTBE became a rampant contaminant plaguing public water providers.

ELG’s Scott Summy filed the first lawsuit in the United States alleging that MTBE contaminated drinking water. He sued Conoco Oil on behalf of a group of Wilmington, North Carolina residents whose water was contaminated by a gasoline spill at a nearby Conoco gas station. In 1997, Conoco Oil settled with these residents for a confidential amount.

Now, ELG has represented over 200 public entities seeking to recover the costs of removing MTBE and benzene from drinking water supplies. ELG’s clients include an array of entities from small villages to entire states. To date, ELG has recovered $_____ to remediate contamination in _____ states.

More about MTBE

Oil companies in the United States started using MTBE in the early 1980s to boost octane in gasoline as the use of leaded gasoline was discontinued. In the 1990s, the use of similar chemicals increased when Congress amended the Clean Air Act to require the use of oxygenates in gasoline in an attempt to meet air quality standards. The Act did not require MTBE use, but refiners chose it over the alternatives because MTBE was inexpensive and readily available as a side-product of the refining process.

MTBE’s characteristics made it a poor choice from an environmental standpoint. It dissolves much more easily in water than the other hazardous chemicals in gasoline — benzene, toluene, ethyl-benzene and xylene (BTEX). That means that when MTBE comes in contact with water, it quickly dissolves and flows along with the water. While the BTEX ingredients of gasoline will tend to stick to soil and stay put, MTBE doesn’t. It flows through the soil to water. As a result, even a small spill of MTBE-containing gasoline will pollute groundwater and can contaminate a nearby well.

Even worse, MTBE does not biodegrade into harmless substances in the natural environment like the BTEX ingredients will. Instead of lessening over time, MTBE continues to spread, contaminating larger quantities of water.

And MTBE is not easy to clean up once it is in the environment. Because it dissolves so completely in water, it is much harder and more expensive to get back out of groundwater than the BTEX chemicals. The oil companies’ own estimates say that adding MTBE to gasoline makes a cleanup project it five times more expensive.

MTBE is a specific concern for drinking water providers because MTBE can make water smell and taste like turpentine. It takes only a few drops of MTBE to contaminate a body of water equivalent to an Olympic-size pool. The taste and smell alone can make the water undrinkable, but taste and smell are not the only problem. The EPA says that MTBE causes cancer in animals and may cause cancer in humans, too.

Liability for MTBE Contamination

Through two decades of litigating MTBE cases, ELG has learned that many of the oil companies who chose to use MTBE in their gasolines foresaw the type of contamination that became a reality for drinking water providers.

When gasoline is delivered to a gas station, it is stored in large underground storage tanks. Documents and deposition testimony confirm that in the 1980s, the oil companies in the United States knew that hundreds of thousands of those tanks across the country were leaking, releasing gasoline into the soil under the tanks. The companies also knew that when MTBE leaks from those tanks, it would easily contaminate groundwater and underlying aquifers, requiring expensive remediation efforts.

The documents also show that some of these oil companies were warned by their own environmental departments not to add MTBE to their gasoline for these very reasons. And some were dealing with MTBE contamination first-hand at their own stations. But they continued to add MTBE to gasoline anyway. After all, MTBE was cheap and available.

ELG also discovered that the oil companies misrepresented the dangers of MTBE to the EPA. Although the companies had their own experience with MTBE contamination, they told the EPA that MTBE did not pose any special threat to the environment. In fact, they promoted MTBE to the EPA as environmentally friendly. When researchers reported in the mid-1980s about the dangers of MTBE as a water contaminant, the oil companies formed an MTBE Committee to counter the bad press and assure the EPA that MTBE was not a risk to the environment.

Role of Station Owners

In the MTBE cases, ELG does not usually sue the owners of gasoline stations that released MTBE-containing gasoline. Under the law of products liability, when a product is defective, everyone in the “chain of distribution” from the manufacturer to the final retailer can be held responsible for harm caused by that product. But ELG’s philosophy is that the entity who knew about the danger posed by a product and decided to sell that product anyway is the entity who should pay for harms caused by that product. With respect to MTBE, ELG has taken the position that the oil companies should be held responsible because they knew the risks of using MTBE, knew from experience that MTBE would leak and would require costly cleanup, misrepresented those risks to EPA and the government, and decided to add MTBE to gasoline anyway. Gas station owners were not part of the decision making process: they had no control over what went into gasoline, and they didn’t know about MTBE or the problems it caused.

The National Settlement

In 2008, Baron & Budd negotiated a settlement with the bulk of the major oil companies that required the oil companies to pay a substantial cash settlement to 153 public water providers and a number of private well owners in 17 states. The companies also agreed to pay for cleanup of any MTBE contamination discovered in the next 30 years — providing protection to an additional 3,600 wells serving millions of Americans. The national settlement represents tremendous progress toward holding the oil companies responsible and getting communities the resources they need to clean up America’s public drinking water supplies.

2011 Settlement

We represented approximately 21 public water providers from six states in similar litigation against oil refiners. We settled these cases (without engaging in discovery) for almost $20 million.

Current Litigation

ELG continues to represent public entities who are facing MTBE contamination in their communities. ELG currently represents two states whose Attorneys General seek to recover damages for the harm done to their statewide water supplies. And ELG continues to field calls from other public entities.

MTBE Bans

Another benefit of the litigation and settlement is that it brought MTBE to public attention. States began to ban the use of MTBE-containing gasoline in 2001. By 2009, twenty-four states had passed similar bans, and refiners had ceased using MTBE.

How Baron & Budd Can Help

If you are a drinking water provider or public entity whose drinking water supplies are contaminated with MTBE or benzene, you may be able to take legal action in an effort to obtain compensation. Please contact the national law firm of Baron & Budd by calling 866-364-6376 or complete our contact form. We will carefully listen to the details of your case and let you know how we may be able to help.

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