The MTBE controversy: defending mass tort claims: the forces of the plaintiffs' bar, commercial competitors, and "junk science" must be met "head on" with coordinated efforts.

AuthorSpeelman, Joseph F.
PositionMethyl tertiary butyl ether

A NEW tyranny is growing in the United States. It threatens not only domestic businesses, but also international enterprises on a global scale. Fueled by billions of dollars in settlements in the tobacco and other mass tort controversies, American plaintiffs' lawyers have been transformed into major "venture capitalists." These well-financed investors, whom some refer to as the new American Aristocracy, are looking to invest in new and profitable products, but those "products" are not produced by the "brick and mortar" or even the "high technology" sectors of the global economy. Instead, the product is litigation.

The ultimate goal is not the general public interest, but rather profits derived from exploiting public fear, media hype, political influence, junk science and the complexities and financial burdens of litigation--profits realized from creating massive controversies that judicially extort major corporations and small businesses into massive settlements without ever resolving the validity of the claims on the merits--profits funded by virtual liquidation of productive corporate assets to yield even more "venture capital" to fuel further campaigns to gain--more money.

This outrage goes beyond "taxation without representation," one of the evils that prompted the American Revolution. Here, the tribute is not even paid to a government, but instead to plaintiffs' counsel who unilaterally select target industries that will yield the greatest return on new litigation products. Many people are concerned that governmental oversight of the U.S. judicial process has been diluted by political contributions by these same lawyers. These lawyers make no pretense of political accountability and, more important, pay no attention to national boundaries. The end result is a closed and unregulated global marketplace where a few opportunists promote "products" comprised of predatory ideas for the purpose of serving their own selfish interests.

Unfortunately, these destructive efforts may destroy otherwise productive products and threaten entire sectors of the global economy. Accordingly, national and international businesses must not only be aware of this threat, they must be prepared and committed to defend themselves and their products against these well-financed and wide-ranging assaults.

The ongoing controversy regarding the gasoline additive methyl tertiary butyl ether (MTBE) is one of the most recent speculative products of the American legal industry. MTBE, an award-winning additive that has been proved to reduce air pollution from gasoline combustion, has been demonized through a co-ordinated effort by American plaintiffs' lawyers, commercial competitors and some opportunistic water agencies, who claim that the additive pollutes groundwater when it leaks from underground storage tanks (USTs). These claims have spawned class actions and mass tort cases involving every state where MTBE was used.

Some of the MTBE litigation has been consolidated into a large multi-district proceeding in New York, but a great deal remains pending in state courts, most notably in California, where a few municipalities and water agencies seek massive damage awards for allegedly polluted water supplies in order to replace current aging, out-of-date and dangerous facilities. The onslaught of litigation has prompted massive adverse publicity; false, inaccurate and unreliable scientific speculations regarding health risks; and strong lobbying by manufacturers of competing products, environmentalists, and state officials.

As a result of the hysteria brought on by these activities, overreaching efforts by state officials to "ban" MTBE, dozens of bills introduced in the U.S. Congress, and investigations of MTBE in a number of other nations, including the entire European Community and many of its members, began to occur. All of these activities were "encouraged" by commercial competitors, the plaintiff attorneys and their clients. Incredibly, all of these extraordinary pressures and developments occurred without a single class certification or adverse jury verdict against MTBE in the United States. Indeed, the only courts to consider the merits of the controversy have rendered and affirmed judgments against plaintiffs that denied class certification. To date, although the controversy has been pending for over three years, no judge or jury has awarded damages against an MTBE defendant.

Using the MTBE controversy as an example, this article examines the emerging trend of mass tort lawsuit abuse in the United States and efforts to export it to global legal systems. In addition to the legal aspects of this phenomenon and the legal devices used for courtroom activity, the article surveys the use of media publicity, political influence, unreliable science, and misconduct by competitors to create intolerable pressures to settle disputes for reasons unrelated to the merits of the controversy. The article then discusses how these large controversies, once created, are used to bypass the protections of national and international democratic institutions. Finally, the article discusses the general principles that may be used to assist business enterprises to deal with and prevail against these types of assaults.

WHAT IS MTBE?

Every product liability mass tort begins with an inventive and enterprising idea. Sometimes the idea itself proves defective and dangerous when it is transformed into a product. Occasionally, however, a truly valuable idea produces a truly valuable product, only to be demonized for reasons wholly unrelated to its merits. This is the lot of MTBE, an oxygenated gasoline additive developed to enhance engine performance and to reduce air pollution by replacing pollution-causing compounds with a cleaner-burning compound.

MTBE is a synthetic organic chemical used for a variety of purposes, including as a blending component in gasoline. It is not newly discovered. An English chemist first synthesized it in 1842, and patents relating to it date back to at least July 1943. In the U.S. Patent and Trademark Office database, almost 1,400 patents were issued from 1976 and 2000 relating in some way to the use or manufacture of MTBE. It is used in medical treatment and industrial applications.

In gasoline, MTBE is considered an "oxygenate" manufactured by the chemical reaction of methanol and isobutylene. Oxygenates, including both alcohols and ethers, have a long history of use in motor fuels, going back to the beginning of the 20th century when ethanol was first promoted for blending into gasoline. At various times, alcohols such as methanol, isopropanol and tertiary butyl alcohol (TBA), and ethers such as di-isopropyl ether (DIPE), ethyl tertiary butyl ether (ETBE), and tertiary amyl methyl ether (TAME), have been used commercially for gasoline blending because of market conditions or special performance properties. As an oxygenate, MTBE has many favorable properties, including a high octane rating, the ability to dilute undesirable gasoline components (aromatics, sulfur, olefin and benzene), low production costs and the ability to mix with other gasoline components.

MTBE is the most widely used oxygenate in gasoline today. Approximately 30 percent of all gasoline in the United States contains oxygenates. MTBE also is widely used for octane enhancement in mid- and high-octane blended gasoline, typically at concentrations ranging from 2 to 8 percent by volume. It also may be found in regular grade gasoline at low concentrations. Currently, MTBE is blended into gasoline at about 11 percent by volume. Thus, total gasoline production is increased by 11 percent solely through the addition of MTBE. Altogether, about 250,000 barrels of MTBE are consumed each day in the United States.

MTBE has been widely hailed for its ability to fight air pollution. It has been recognized by the National Environmental Awards Council as an additive used to comply with the U.S. Environmental Protection Agency's 1990 mandate to produce reformulated gasoline (RFG) to reduce ozone, air toxics and carbon monoxide emissions. (1) The EPA itself has called MTBE a "cost effective fuel blending component that provides high octane, carbon monoxide, and exhaust VOC's emissions benefits, and appears to contribute to the reduction of the use of aromatics with related toxics and other air quality benefits." (2)

Other organizations have stressed the health benefits achieved by using MTBE, noting, "For the population as a whole, the public health benefits RFG provides by reducing air pollution substantially outweigh public health impacts from exposure to increased levels of MTBE in the air and water." (3) MTBE's value was recognized in 2001 in a draft report to the European Commission as a safe and effective product when used responsibly in tandem with robust enforcement of underground storage tank regulations. (4)

CONCERNS REGARDING MTBE

The three most immediate practical issues raised in the current MTBE controversy are (1) toxicity, (2)exacerbation of contamination and (3) increasing difficulty in remediation.

Regarding toxicity, Superfund, established by the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. [section] 9641, lists MTBE as a hazardous substance. Although it is known to be less toxic than many other gasoline constituents, concerns have been raised about the potential for acute inhalation effects at service stations and chronic effects from drinking water contaminated with MTBE. Some researchers and regulatory agencies have been concerned that MTBE may be a human carcinogen. Although scientific research has not substantiated these problems and researchers are still studying the issues, in May 2000, the National Toxicity Program, a part of the U.S. Department of Health and Human Services, removed MTBE from its list of human carcinogens because it believes that MTBE does not meet the criteria to be listed as a substance...

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