Court allows second amended complaint in PFAS contamination case

As 2024 draws to a close, it appears a lawsuit pitting a group of Town of Stella property owners against the current and former owners of the Rhinelander paper mill has reached the end of the preliminary pleading stage.

 In mid-October, Judge William Conley of the U.S. District Court for the Western District of Wisconsin  granted the plaintiffs’ request to file a second amended complaint against Ahlstrom-Munksjo, Wausau Paper and the chemical company 3M.

The plaintiff’s original complaint — alleging that the spread of PFAS-contaminated sludge/fibercake from the Rhinelander mill on local farmlands contaminated private drinking wells — was filed in August 2023. An amended complaint, which included additional plaintiffs, was filed in February 2024.

All three defendants responded to the earlier versions of the complaint by filing motions to dismiss.

In September, attorneys for the plaintiffs requested permission to file a second amended complaint which, in addition to the allegations related to drinking water, references contamination of certain water bodies in and near the eastern Oneida County township.

“Defendants also caused significant contamination in multiple water bodies in or near Stella, Wisconsin,” the October complaint alleges. “Snowden Lake, around which some Plaintiffs and Class Members live, contains PFOA + PFOS at levels greater than 1600 parts per trillion. Other nearby lakes in the Moen Lake Chain also contain levels in the hundreds of parts per trillion range. Wisconsin Department of Health Services, Bureau of Environmental and Occupational Health recommends limited consumption of fish from these water bodies and even cautions against swimming, waterskiing, tubing, or other activities that involve a higher chance of swallowing water.:

The October filing also includes a new allegation directed at the paper companies — unjust enrichment. 

According to the complaint, the “paper mill defendants” paid some of the plaintiffs to allow the spreading of paper mill sludge on their farmland, representing that the sludge would “act as a fertilizer for crops and was not harmful.”

“This contractual arrangement benefitted the Paper Mill Defendants who would otherwise be forced to use another, more expensive disposal method, specifically, disposal of the sludge in a landfill,” the complaint reads. “The Paper Mill Defendants never disclosed that, in fact, the sludge contained chemicals used to create grease-proof properties in their paper products, or that such chemicals included PFAS chemicals. Subclass members are now left with farmland and groundwater containing PFAS chemicals. The cost to subclass members to remove or abate the PFAS contamination from the farmland and current or potential groundwater wells far exceeds the payment received for land spreading from the Paper Mill Defendants. Under this circumstance, the benefit received by the Paper Mill Defendants is inequitable, and subclass members seek disgorgement and/or other such injunctive and equitable relief as the court deems just and proper.”

The River News reached out to Ahlstrom representatives seeking comment on the surface water contamination allegations as well as the unjust enrichment claim. In response, a spokesperson for the company advised that it is Ahlstrom’s policy not to comment on pending litigation.

Previously, the Helsinki, Finland-based company told the River News it has not used PFOA or PFOS (types of PFAS) in its manufacturing process since purchasing the mill in 2018 and has implemented proprietary technology as part of its sustainability efforts. 

PFAS are a group of man-made, fluorinated chemicals manufactured and used since the 1940s. Because they are designed to be stable and unreactive to water, grease, heat, and other elements, they are often referred to as “forever” compounds.  Studies have shown a link between human exposure to PFAS and adverse health effects. Some of the Stella plaintiffs allege they have experienced health issues they attribute to PFAS contamination.

Residents became aware of the contamination in late 2022 after the DNR conducted a statewide testing program.

While neither of the two paper companies have filed a written response to the complaint filed in October — their previously filed motions are still pending — 3M has.

In its motion, the chemical giant disputes the plaintiffs’ allegation that it could have foreseen that the use of its PFAS products in paper manufacturing would result in groundwater (and drinking water) contamination impacting the plaintiffs’ health and property.

“According to the Third Amended Complaint, Ahlstrom and Wausau Paper’s alleged decisions to dump waste containing PFOS and PFOA onto open farmland were improper, inappropriate, and uncommon,” attorneys for 3M wrote in their motion filed on Dec. 9.  “The opposition identifies no facts in the complaint that would support an inference that 3M could have foreseen that Ahlstrom and Wausau Paper would engage in that alleged practice. That intervening conduct thus severs any causal link between 3M and plaintiffs’ alleged harm and requires dismissal of plaintiffs’ claims against 3M.”

“Plaintiffs’ claims should be dismissed for other reasons as well,” 3M argues. “The strict-liability claims are barred by the statute of repose and rest on conclusory allegations that do not adequately plead the necessary elements of the claims. Plaintiffs notably concede that they cannot state an intentional trespass claim, but the complaint does not support any trespass or private-nuisance claims. The opposition consistently falls back on the complaint’s conclusory allegations as to 3M, but clearly established precedent requires more than that to state a claim. This court should reject plaintiffs’ arguments that they could theoretically plead alternative theories of relief and that discovery will give them what they need — both of which are attempts to cover up the complaint’s shortcomings. As a matter of law, the complaint fails to state a claim as to 3M.”

The chemical company is also disputing the plaintiff’s claims related to defective design and failure to warn. 

The paper companies have been equally forceful in their responses to the lawsuit.

In motions to dismiss filed earlier this year, the paper mills defendants argued that, among other things, land-spreading is a common practice, regulated by the DNR, that does not meet the legal definition of a “hazardous activity” as is required for the plaintiff’s strict liability claim to prevail.

The defendants have also indicated they intend to intend to “vigorously oppose” any attempt by the plaintiffs to have the lawsuit certified as a “class action” as it is their belief that none of the claims meet the “rigorous standards” for class certification.

Online court records indicate the parties do not expect a ruling on the question of class certification until late next year, should the court ultimately deny the various motions to dismiss. 

At present, the case is scheduled for jury trial in late September 2026.

Heather Schaefer may be reached at [email protected].