This is the report that I delivered on the House Floor regarding S.37.

S.37 has two components.  First, it would establish the criteria under which people wrongfully exposed to toxic substances could sue to have the polluter pay for monitoring their medical condition.  Second, it expands the type of entities that can be held liable for the cost of cleaning up hazardous materials that are released into the environment.  I will first address medical monitoring.

During the winter of 2016, the State of Vermont discovered widespread contamination of private drinking water supplies with perfluorooctanoic [Per fluro octa no ick] acid (PFOA) in Bennington County. Perfluorinated compounds such as PFOA are manufactured chemicals used to make a variety of commercial and household products. PFOA does not easily break down and persists in the environment for decades, particularly in water. Studies have shown a correlation between levels of PFOA in the blood and a variety of illnesses including high blood pressure, decreased birth weight, some immune system effects, thyroid disease, kidney cancer, and testicular cancer.

PFOA has been largely unregulated for decades under federal and Vermont law. But it is just one example of chemicals that pose risks to human health and the environment.  There are approximately 85,000 chemicals on the federal Chemical Substance Inventory and thousands of chemicals used that are not even on a list of toxic substances.  Only about 200 of these chemicals have had robust health and safety testing by the federal Environmental Protection Agency.

Recognizing the need to protect Vermonters from the impact of toxic chemicals, the Vermont General Assembly enacted Act 154 in 2016. The law directed the Agency of Natural Resources to convene a working group to address the use and regulation of toxic chemicals.  Among other tasks, the working group was to recommend how to fill gaps in Vermont laws in order to better protect Vermonters from exposure to harmful chemicals, and to help them if they are impacted by toxic contamination.

In January 2017, the working group published its final report.  It recommended, in part, that the legislature should authorize individuals to recover the expense of medical monitoring for diseases when exposed to toxic substances due to another’s wrongful conduct.  S.37 is the response to this recommendation.

Medical monitoring is a program designed by experts in the field of public health and medicine.  It includes screening and ongoing observation to detect the symptoms of latent diseases linked to exposure to a toxic substance.  Monitoring allows for the earliest detection and treatment of these latent diseases.  Similar to early detection efforts such as mammograms and colonoscopies, this program ensures the best possible health outcomes at the least cost. It ensures that those harmed are screened and referred for medical care at the earliest possible time when effective treatment can improve outcomes.

S.37 ensures that the cost of medical monitoring is not borne by the general public or the harmed individuals, as currently is the case. Rather, that cost is paid by the industrial entity that caused the need for incurring those health costs.

It will not be easy for individuals to prove that they are entitled to the remedy of medical monitoring.  Individuals will have to convince a judge or jury that a company wrongfully exposed them to a known toxic substance; that the exposure to the toxic chemical increases their risk of developing a latent disease; that the exposure was at a level that could credibly trigger the need for medical monitoring; and that there are diagnostic tests that can detect the latent disease. While it sets a high bar of proof, the bill would provide a path for Vermonters to receive a remedy that is not currently available under Vermont law.

In short, the bill provides that those responsible for wrongfully exposing Vermonters to toxic substances known to cause diseases will bear the costs of monitoring for those diseases.

Section-by-section explanation

Section 1. Adds a new chapter to Title 12—12 V.S.A. chapter 219 – Medical Monitoring

12 V.S.A. § 7201 provides relevant definitions for the Chapter.  I will come back to the pertinent definitions as I explain the next section of the bill, which sets forth the test for obtaining Medical Monitoring relief for Exposure to Toxic Substances

• 12 V.S.A. § 7202(a) authorizes a cause of action for medical monitoring by a person, without a present injury, against the owner or operator of a large facility from which a toxic substance is released if all of the following are demonstrated by a preponderance of the evidence:

Some of the terms in this provision require further explanation.

First, only people without a present injury can sue for medical monitoring under S.37.  Those who have already developed a disease from exposure to a toxic substance are already able to sue for harm caused to them, including medical monitoring costs.

Second, not all facilities are included in the scope of S.37.  It must be a Large Facility, first of all.

• Section 7201 defines large facility as a facility:
• where an activity with certain Standard Industrial Classification codes (SIC codes) is conducted or was conducted. The included SIC codes cover mining, manufacturing, and transportation businesses. The classification codes do not include agriculture or the health care industry.
• A facility is also defined as “large” where 10 or more full-time employees have been employed at any one time; or that is owned or operated by a person who, when all facilities or establishments the person owns or controls are aggregated, has employed 500 employees at any one time.
• The House version of this section narrows the definition of “large facility.”In the Senate version, anyfacility with 10 or more full-time employees would be subject to the law.Under the House version, those facilities must also fall under one of the SIC codes.
• Third, section 7201 defines toxic substance as any substance, mixture, or compound that may cause personal injury or disease to humans through ingestion, inhalation, or absorption through any body surface and that:
• Is listed on EPA’s list of hazardous substances recognized by federal laws [CERCLA, RCRA, EPCRA, CAA lists];
• Is a hazardous material or hazardous waste under State law;
• Has been determined by National Institute for Occupational Safety and Health or EPA testing to pose acute or chronic health hazards;
• Is the subject of a public health advisory from the Vermont Department of Health; or
• exposure to the substance is shown by expert testimony to increase the risk of developing a latent disease.
  • I will note here that other states have established the remedy of medical monitoring through court-made law. The courts generally do not define what a toxic substance is.  Rather, they usually refer to a “proven hazardous substance,” without explaining how the substance is proven to be hazardous.  Accordingly, in these states there is no clarity or limits surrounding what is considered a toxic substance.  37 takes a different approach by providing a definition of toxic substances.
• Properly and lawfully applied pesticides and ammunition and components thereof are not toxic substances for the purposes of S.37.

Turning back to the test for proving the entitlement to medical monitoring, the person must prove all of the following four elements by a preponderance of the evidence:

• The first element provides that the person was exposed to the toxic substance as a result of tortious conduct by the owner or operators of the large facility or persons under their control;
  • Tortious conduct includes the common law torts of negligence, trespass, nuisance, product liability, or common law liability for ultra-hazardous activity. Tortious conduct is a standard used in other states.  But S.37 limits the scope of what is to be considered tortious conduct by defining the universe of torts.  Other states do not do this and courts have expanded the cause of action beyond the traditional torts.  37 is limiting in the scope of action when compared to some other jurisdictions.
• The second element of the test provides that as a proximate result of the exposure, the exposed person has a greater risk of contracting a latent disease;
  • Disease is defined in 7201 as any disease, illness, ailment, or adverse physiological or chemical change linked to exposure to a toxic substance.
• The third element of the test provides that diagnostic testing is reasonably necessary. Testing is reasonably necessary if a physician would prescribe testing based on the fact that the increased risk of contracting the disease due to the exposure makes it reasonably necessary to undergo diagnostic testing that is different from what would normally be prescribed in the absence of exposure. This must be shown by expert testimony.
  • Breaking this provision down, the issues are:
    • Whether the increased risk is sufficient to make diagnostic testing reasonably necessary and
    • Whether the diagnostic testing would be prescribed in the absence of exposure to the toxic substance.
  • The final element of the test provides that medical tests or procedures exist to detect the latent disease.

I will reiterate here that proving these elements would be very difficult and would be developed through expert testimony.

• Subsection (b) provides that if medical monitoring damages are awarded, a court shall order the liable entity to pay the award to a court-supervised medical monitoring program administered by a health official with expertise in toxic exposure or the relevant latent disease.
• Subsection (c) provides that upon an award of medical monitoring damages, the court shall also award the prevailing party reasonable attorney’s fees and costs.
• Subsection (d) provides that nothing in the new chapter authorizing medical monitoring damages precludes the pursuit of any other civil or injunctive remedy available under statute or common law. Except that this law provides the exclusive medical monitoring remedy for individuals without a present injury.
• Subsection (e) clarifies that the exclusive remedy for employees injured at work is through workers compensation. However, if the employee is wrongfully exposed to a toxic substance and has no present injury, the employee may seek a remedy under the procedures created in S.37.

Section 2 – Session law

• The right of a person to bring a cause of action for medical monitoring shall apply retroactively to an exposure to a toxic substance that was discovered by the person in the six years prior to July 1, 2019. The six-year period is consistent with the statute of limitations for civil actions where there is no personal injury.  12 VSA 511.

That concludes the section-by-section analysis of the medical monitoring component of the bill.

Courts in 16 states have recognized a medical monitoring cause of action or remedy. Each state court has created its own test based on the facts and circumstances in the case before it. There is not one test for medical monitoring. The test for medical monitoring in S.37 is not more lenient for people seeking relief than the tests in states providing court-created remedies for medical monitoring.

Indeed, in some respects S.37 creates a right to sue that is narrower than that provided in other states.  The bill limits the cause of action to releases from a subset of large facilities, a limitation not recognized in any other states. Unlike other states, the bill defines disease and defines toxic substance.  Finally, no states include the exemptions that S.37 contains. In this respect, S.37 provides more clarity than tests in other states that have been developed in judicial opinions.  This is one of the advantages of addressing this issue legislatively rather than through the courts.  By enacting S.37, we are able to define these terms and place limits on the applicability of this cause of action based on the broader policy that serves Vermonters best.

Several policy considerations support enacting a medical monitoring cause of action:

First, there is an important public health interest in fostering access to medical testing for individuals whose wrongful exposure to toxic chemicals creates an enhanced risk of disease, particularly in light of the value of early diagnosis and treatment. The availability of medical monitoring may prevent or decrease the severity of future illness and reduce the costs for everyone involved. The early detection of latent diseases may improve the prospects for cure, treatment, prolongation of life and minimization of pain and disability.

Second, there is a deterrence value in recognizing medical monitoring claims – allowing plaintiffs to recover the cost of this care deters irresponsible discharge of toxic chemicals.

Third, standards of fairness and justice are better served by allowing recovery of medical monitoring costs. It would be inequitable for individuals wrongfully exposed to dangerous toxins to have to pay the expense of medical monitoring through no fault of their own.

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I will now turn to the second component of this bill. It holds entities liable for the costs of cleaning up hazardous materials they released into the environment.

Section 3 of S.37 amends section 6615 of Title 10, which is part of Vermont’s Waste Management Act and in many respects parallels the federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).

One of the purposes of the Vermont Waste Management Act is to make generators of waste pay for disposal costs that reflect the real costs to society of waste management and disposal. [10 V.S.A. 6601]

Section 6615 protects public health and the environment by facilitating the cleanup of hazardous-waste sites.  It ensures that costs of that cleanup are not borne by the State or tax payers.

6615 holds certain people financially responsible for the release of hazardous waste.  They are responsible for the costs of investigating, responding to, and remediating the harm from a release of hazardous materials. The responsible entities under current law are the owner, operator, transporters, or arrangers.  An “arranger” is anyone, who by contract or other agreement arranged for the disposal or transport of the hazardous material.

Currently an owner, operator, transporter, or arranger are the entities that can be responsible for cleanup costs even if they had no knowledge of the hazardous nature of the material used or transported.  In these situations, the manufacturer of the substance escapes all liability to the State. Instead, the responsible entities must sue the manufacturer to contribute towards the cost of remediation, thereby requiring additional litigation.

Language proposed by the Agency of Natural Resources and the Administration seeks to eliminate this inequity.  It does so by holding a manufacturer to the same strict, joint, and several liability standard the rest of the responsible entities are held to when the manufacturer knew of the risk of the material and failed to adequately warn the user.

Imposing liability on the manufacturer makes sense in the same way allowing claims for medical monitoring makes sense. On one hand, there is the manufacturer of the hazardous waste who knew of the risks and failed to warn.  On the other, there is the owner, operator, transporter or arranger who knew nothing of the risk and managed the material as if it did not pose a risk. Clearly the manufacturer should be responsible for the costs of the remediation in that situation.

6615 was enacted to protect the public and ensure that the harm to the environment was mitigated as soon as practicable and that the entities that caused or contributed to the release are held liable for the costs.  S.37 seeks to bring further equity to 6615 by allowing the State to more effectively litigate against manufacturers who allowed hazardous materials into commerce without sufficiently notifying the public or others in the supply chain of the potential harm.

Section-by-Section

Sec. 3 amends 10 V.S.A. § 6615

• Section 6615(a) clarifies the liability that entities have for abating a release of hazardous materials and for the costs of investigation, removal, and remedial actions incurred by the State that are necessary to protect the public health or the environment.
• Section 6615(a)(5) adds a manufacturer of a commercially available hazardous material to the list of entities potentially liable for a release.
• A manufacturer would be liable if: 1) it manufactured a hazardous material for commercial sale and knew or should have known the material presented a threat of harm to health or the environment; and 2) the material was released to the environment.
• The bill would allow the State to bring the action. It does not create a strict liability cause of action in a private lawsuit for an injury to a person.
• Subsection (d)(5) provides that a manufacturer would not be liable if it demonstrated that it provided adequate warning of the harm posed by the hazardous material that was known or should have been known at the time the material was manufactured.
• Subsection (i) provides that a liable manufacturer cannot seek contribution (payment) from other potentially liable entities. If the manufacturer knew of the harm and sold it without adequate warning, the liability should not be on the innocent entity that purchased the product.

Section 4 – Application of Liability

• A manufacturer’s liability under 6615 would apply retroactively to releases occurring before the act’s effective date.
• Generally, liability for hazardous materials release applies retroactively for any release and all classes of liable persons.

Section 5 – Effective date – July 1, 2019

The Committee vote was 10-0-1.