MTBE Phaseout May Fuel Price Hike
The Oakland Tribune

• • •

Ca. MTBE Ban Doesn't Match With Lower UST Detections

• • •

State Could Face Gasoline Price Hikes
Los Angeles Times

• • •

Nation's Largest Underground Storage Tank Testing Firm Sentenced to Pay $2.29 Million
USEPA Press Release

• • •

California Monitoring Shows Drop In MTBE Groundwater Contamination
Inside Washington Publishers

• • •

MTBE Poses No Human Health Risks, EC Report Concludes
Hart’s European Fuels News

• • •

Officials Guard Against Leaks at Gas Stations
LA Times

• • •


MTBE Liability Relief Makes Sense

To grant relief to any chemical from liability may sound unreasonable on the surface. In fact, such liability relief for the gasoline additive MTBE is proposed in the Omnibus Energy Bill presently before Congress. The actual relief is from liability brought about by a broadly written trial lawyer's dream law. This law is allows for a finding that a product manufacturer had allowed a "defective product" to be released into the marketplace without warnings. This liability relief has nothing to do with the clean up of environmental damage that may have been caused by the subject product. It has much to do with enriching trial lawyers through sympathetic juries.

Other laws and regulations have required and will continue to impose clean up liability on those responsible for contaminating the environment. There are also federal and state clean up funds available for situations where the liable entity doesn't have adequate resources or where there is no obvious liable entity.

In the case of MTBE, the alleged "defect" is its ability to easily mix with water. The issue is gasoline-containing MTBE, primarily released from leaking underground tank systems, contaminating groundwater. At first, the reports of MTBE in groundwater were exaggerated to include a very large number of non-drinking water monitoring wells intended to detect gasoline and other contamination. A small percentage (less than one percent) of groundwater sources used for drinking water have been discovered to contain very low levels of MTBE causing a possible taste and odor issue - but no health threats. The vast majority of these few incidents occurred before the end of 1998 when the U.S. Environmental Protection Agency required all underground tank systems to be upgraded or taken out of service. Since then very few new incidents of MTBE in groundwater have been discovered with the likelihood that these few new incidents are past releases just now being discovered.

Those opposing MTBE liability relief are pointing to a non-peer reviewed paper written by consultants working for MTBE suit trial lawyers that has never been released to the public. This defective study estimates a $29 billion price tag to clean up MTBE nationwide. The basis for this number is extremely faulty as it includes the total cost to clean up all gasoline releases and grossly overestimates the cost of individual site clean up as compared to real world costs. The study also ignores the drastically reduced incidence of MTBE involved contamination.

In the majority of cases, where a gasoline release is discovered involving MTBE, the cost of clean up is not substantially greater than the costs associated with a gasoline release that does not involve MTBE. In situations where a release is allowed to continue without detection for long periods of time, as happened prior to the required storage system upgrades, the costs can accelerate. Under current laws and regulations, release detection should be more near term than long term resulting in clean up costs that are more similar to gasoline remedial costs.

So why is there so much noise being made in opposition to this liability relief? If one were to take a close look at where the noise is coming from, one would see trial lawyers who are lined up behind several former and pending MTBE liability suits using this defective product law that is realistically frivolous with regard to MTBE in gasoline.

Two notable MTBE suits were settled in California resulting in major financial rewards for the plaintiff trial lawyers filing the claims. One suit in South Lake Tahoe, settled for $69 million with more than $20 million going to the trial lawyers. Out of an approximate $93 million settlement in Santa Monica, the lawyers involved raked in about $30 million. Even with trial expenses, these numbers translate into tidy multi-million dollar profits for these law firms with no concomitant benefit to the environment.

Maintaining clean up liability on those that have caused the contamination of groundwater by not upgrading or properly maintaining their underground storage systems makes sense. Consistent with the rising desire to place greater control on the increased incidence of frivolous litigation, granting liability relief from the trial lawyer-enriching defective product lawsuits to the manufacturers of MTBE makes even greater sense.

© Copyright,