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New York State Lengthens Statute of Limitations for Water Provider Contamination Lawsuits

November 07, 2019

New York Governor Andrew Cuomo signed legislation (S.3337C/A.5477C) on November 4 amending the New York Civil Practice Law and Rules to add new Section 214-h, which effectively lengthens the statute of limitations for claims filed by public water districts related to contamination of their water supply. New York is also on track to enact new maximum contaminant levels for three emerging contaminants of concern: perfluorooctane (PFOS), perfluorooctanoic acid (PFOA), and 1,4-dioxane. These changes to New York’s laws and regulations will likely lead to increased litigation by water districts in New York against manufacturers and other operators associated with these contaminants.

Background

Since 1996, the US Environmental Protection Agency (EPA) has required public water districts throughout the country to test for a rotating list of unregulated contaminants in drinking water through what is known as Unregulated Contaminant Monitoring. Despite several rounds of testing, the EPA has not enacted any new drinking water contaminant regulations in the last two decades. In response, several states have ramped up their own efforts to regulate emerging contaminants in drinking water.

In New York, the state legislature passed the Clean Water Infrastructure Act in April 2017, creating the Drinking Water Council to consider setting maximum contaminant levels (MCLs) for several emerging contaminants not regulated by the EPA. In December 2018, the Drinking Water Council recommended that the New York Department of Health set MCLs at 1 part per billion (ppb) for 1,4-dioxane and 10 parts per trillion (ppt) for PFOS and PFOA. In July 2019, the Department of Health began the rulemaking process to enact these MCLs by publishing notice of the new standards in the New York State Register and opening a 60-day public comment period. The proposed regulations have not yet been enacted.

In response to the recommendations of the Drinking Water Council and in anticipation of the enactment of more protective MCLs, which may require the installation of new, nontraditional water treatment systems, more than 25 water districts on Long Island alone have filed lawsuits seeking damages associated with treatment for 1,4-dioxane, PFOS, and PFOA contamination. These lawsuits target both manufacturers and operators of businesses that used solvents potentially containing 1,4-dioxane. The lawsuits include claims for relief under common law theories such as public nuisance, trespassing, failure to warn, strict products liability, and negligence, as well as through claims under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).

Prior Statute of Limitations

Prior to the addition of New York Civil Practice Law and Rules (CPLR) Section 214-h, water provider claims for contamination were subject to the three-year statute of limitations under CPLR Section 214-c(2). Such claims accrued on the date a water provider discovered an injury or the date when, through the exercise of reasonable diligence, the water provider should have discovered the injury, whichever is earlier. When determining the applicability of the statute of limitations to injuries to public water purveyors, New York courts held that “the statute of limitation typically begins to run when the [water provider] should have discovered the injury. In this context, in order for the statute of limitations to run, knowledge of both the dangers of contamination as well as the harmful impact are required. It is not enough to merely detect contamination.” Hicksville Water Dist. v. Philips Elecs. N. Am. Corp., No. 2-17-CV-04442-ADS-ARL, 2018 WL 1542670, at *5 (E.D.N.Y. Mar. 29, 2018); see also Bethpage Water Dist. v. Northrop Grumman Corp., 884 F.3d 118, 128 (2d Cir. 2018) (requiring “knowledge that the contamination [i]s significant enough to justify ‘an immediate or specific remediation effort’”).

Revised Statute of Limitations

CPLR Section 214-h adds a new, specific statute of limitations to govern claims brought by water providers. The limitations period begins three years from the latest of (1) the detection of a contaminant in excess of any notification level, action level, maximum contaminant level, or maximum contaminant level goal; (2) the last wrongful act by any person whose conduct contributed to the presence of the contaminant; or (3) the date the contaminant is last detected as being in excess of any notification level, action level, maximum contaminant level, or maximum contaminant level goal for that contaminant. CPLR Section 214-h takes effect immediately, but is expressly not retroactive.

CPLR Section 214-h provides a far more generous window within which a water provider may file suit for contamination of its water supply. If the proposed MCLs for the emerging contaminants are enacted, water districts will have up to three years to file suit for contamination detected in excess of the new standards. Moreover, the wording of the statute could potentially give rise to arguments that the limitations period is reset each time a contaminant is detected at levels in excess of the MCL.

Long Island water providers have already been targeting companies to fund necessary treatment systems so as to avoid increases on ratepayers, and this new regulation may increase the number of such suits. Going forward, it will be more challenging for defendant companies to invoke the protection of the statute of limitations for such claims, and they will need to rely more heavily on other defenses in litigating these types of claims.

Contacts

If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:

New York
Stephanie Feingold

Philadelphia
Glen Stuart

Princeton
John McGahren
Stephanie Feingold

Los Angeles
James Dragna
Rick Rothman

San Francisco
Ella Foley Gannon

Washington, DC
Duke McCall