Yesterday a jury in a New Hampshire state court handed down a $236 million judgment against ExxonMobil over the use of MTBE in gasoline, the latest chapter in a story that has dragged on for 10 years.
MTBE, or methyl tertiary butyl ether, is an oxygenate that was blended in gasoline to reduce lead exposure and improve air quality. The state alleged that the use of MTBE in gasoline either contaminated or posed a threat of contamination to groundwater and surface waters in the state, including drinking water supplies.
We disagree with the verdict and we plan to appeal. There are three salient facts that anyone learning about this case needs to know.
1. MTBE was used in limited quantities beginning in the 1980s as an octane enhancer to enable the phase-out of lead from gasoline. Its use became widespread after 1990, when the federal government mandated that refiners such as ExxonMobil blend oxygenates into gasoline supplies in areas with poor air quality. More than 90 percent of reformulated gasoline used MTBE because it was more effective at combating pollution than the only other viable oxygenate, ethanol. And unlike ethanol, MTBE could be used in the existing pipeline distribution system and would not interfere with car performance. In 2006, the federal government eliminated the oxygenate requirement, replacing it with the Renewable Fuel Standard.
2. The state of New Hampshire fully endorsed the federal government’s efforts to mandate the use of oxygenates like MTBE in gasoline supplies. In fact, federal law did not require that MTBE be used in New Hampshire, but its officials voluntarily requested that the state be included in the federal program to improve air quality. Only later did the state begin having second thoughts, seeking to punish companies for complying with federal and state laws.
3. To date, there have been no adverse health effects from the use of MTBE in New Hampshire. There is not a single recorded case of anyone getting sick – not a single human health claim – from drinking water with MTBE in it. Nor is there any sort of MTBE groundwater crisis in New Hampshire. Even with the state’s stringent MTBE threshold of 13 parts per billion, there is no community public well providing drinking water to people’s homes that exceeds that limit. The water in New Hampshire is safe to use and drink.
The interesting thing is that the MTBE mandate worked as intended. It has improved air quality, leading to significant public health benefits. The use of MTBE has resulted in the reduction of 105,000 tons of smog pollutants per year – the equivalent of removing 16 million cars from the road – more than every single car in New Hampshire, Vermont, Maine, Massachusetts, Connecticut, Rhode Island and part of New York, combined.
The state’s case against ExxonMobil relied on hypothetical computer models alleging water contamination, rather than relying on available and statistically significant data from the real world – all of which clearly demonstrate that MTBE is rapidly decreasing. We believe that erroneous rulings during the case connected to the admissibility of the state’s data gave jurors a skewed picture of the facts concerning MTBE.
Finally, it’s worth emphasizing that MTBE is only found in groundwater above threshold levels in places where it was spilled. Those responsible for spilling gasoline with MTBE should be held accountable for the clean-up, not the refiners who supplied the gasoline to the marketplace. It’s like holding General Motors responsible for all the accidents involving their vehicles.
We look forward to presenting our arguments to the appeals court. We are confident both on the facts and on the law.
