D.C. Circuit Upholds EPA’s CERCLA Hazardous Substance Designation for PFOA and PFOS

On August 18, 2026, the United States Court of Appeals for the District of Columbia denied a petition brought by seven interest groups representing industries that use, transport, or discharge Perfluorooctanoic acid (PFOA) and Perfluorooctanesulfonic (PFOS). The petition sought to overturn the Environmental Protection Agency’s (EPA) designation of PFOA and PFOS as “hazardous substances” under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).

The court’s decision leaves the designation of PFOA and PFOS in place and confirms the profound alteration of liability for the two substances. This designation means that releases of more than one pound of PFOA or PFOS, or their salts or isomers, in any 24-hour period are subject to reporting requirements. More significantly, potentially responsible parties may be responsible for additional cleanup costs at new or existing cleanup sites. They may also face contributions claims and cost-recovery actions brought by state and federal governments or private parties.

Background

In May 2024, EPA published a final rule designating PFOA and PFOS, and their salts and structural isomers, as “hazardous substances” under section 102(a) of CERCLA. This designation was unprecedented and controversial as it was the first time the EPA used its statutory authority under CERCLA to designate a hazardous substance. Previously, hazardous substances under CERCLA were only defined by reference to other statutes, such as the Clean Water Act.

The case challenging this rule, Chamber of Commerce of the United States of America v. EPA, No. 24-1193 (D.C. Cir.) was initiated in June 2024. In February 2025, EPA requested the court hold the case in abeyance while it considered whether it would take a different position on the designation under the new administration. On January 20, 2026, oral argument was held before a panel of three D.C. Circuit judges.

The D.C. Circuit court addressed three challenges brought by the petitioners: (1) EPA misinterpreted the term “may present substantial danger” in CERCLA’s definition of a hazardous substance; (2) EPA’s cost-benefit analysis provided insufficient notice to the parties; and (3) EPA’s cost-benefit analysis and decision to regulate in the face of uncertainty were arbitrary and capricious. Ultimately, the D.C. Circuit court rejected all three challenges brought by the petitioners.

First, relating to CERCLA’s definition of a hazardous substance, the court agreed with EPA’s plain reading that “may” in “may present a substantial risk of harm” means “a possibility” rather than Petitioners’ argument that “may” should be interpreted as “will.” This affirms that the standard only requires a scientifically supported possibility of serious harm, not a certainty that harm results from each release.

Second, the court rejected Petitioners’ argument that the final Regulatory Impact Analysis differed so significantly from the Economic Assessment that they were not provided sufficient notice under the Administrative Procedure Act. Using the “logical outgrowth” test, the court held that the Regulatory Impact Assessment was a logical outgrowth of the Economic Assessment, and therefore, Petitioners did receive sufficient notice.

Third, the Petitioners argued that the designation was arbitrary and capricious because EPA did not carefully assess nor fully understand the severity of consequences that come with the designation of PFOA and PFOS. They highlighted uncertainties such as (1) where PFOA and PFOS are located, and in what quantities, (2) the economic costs of the Final Rule and how parties will address contamination, and (3) unintended consequences such as effects on real estate transactions. The court found that EPA reasonably addressed industry concerns and explained its assessment of the rule’s benefits while acknowledging uncertainties. The EPA highlighted that CERCLA response actions are fact-specific and depend on several future regulatory determinations before liability and costs are accrued.

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