Claims
Fifteen states sue Corteva, alleging Vylor spinoff shields assets from PFAS claims
By Insurance Wire Staff, . Insurance Wire.
Fifteen US states and the territory of Guam sued agrichemicals company Corteva on Thursday, the same day the company completed its spinoff of the seed and genetics business into a newly independent publicly traded company called Vylor. Business Insurance, Carrier Management and Insurance Journal all covered the story, drawing on Reuters reporting, and their accounts are consistent on every material point.
The suit, which a bipartisan coalition of state attorneys general brought in Indiana state court, alleges that Vylor received what the complaint calls the "crown jewels" of Corteva's business while taking on no responsibility for contamination from perfluoroalkyl and polyfluoroalkyl substances (PFAS). PFAS are synthetic chemicals that persist in the environment and the human body and have been linked to health risks; they are sometimes called "forever chemicals" because they do not break down naturally. The states argue the transaction amounted to moving valuable assets out of reach of creditors pursuing claims against former DuPont entities.
Corteva's PFAS exposure traces back through its corporate history. The company was formed from a merger of Dow Chemical and DuPont and, when it was later spun off from DuPont as a standalone company, it inherited a share of DuPont's PFAS liabilities. DuPont produced and sold PFAS-containing chemicals for decades, and Corteva has since been named in thousands of lawsuits alleging environmental contamination and health risks for millions of Americans.
Corteva has pushed back. In September, the company said the states' PFAS claims are, in its words, "speculative and unproven," and it has maintained that it never manufactured or sold PFAS products itself.
California had already tried to stop the spinoff before it closed, filing an emergency request in a separate federal PFAS case. A federal judge in South Carolina rejected that request on Wednesday, one day before the spinoff completed and the Indiana lawsuit was filed.
New Hampshire Attorney General John Formella put the states' position plainly: "Companies cannot simply move valuable assets out of reach and leave states, communities and taxpayers to deal with the liabilities left behind."
Vylor's chief executive Chuck Magro, in a statement Thursday, said the new company's goal is to "reimagine agriculture," with targets of net sales between $11.2 billion and $11.9 billion by 2029, according to Business Insurance.
For insurers and claims professionals, the case raises a question that goes beyond Corteva's specific PFAS exposure: whether courts will treat a completed corporate spinoff as a fraudulent transfer when the spun-off entity carries the profitable operations and the legacy entity retains the liability. The Indiana filing is the states' attempt to answer that question in their favor, but the South Carolina ruling shows that at least one federal court was unwilling to intervene before the transaction closed. Whether Indiana state courts apply a different standard is the central legal question to watch.
The scale of potential PFAS liability across the industry remains genuinely uncertain. No official figure has been established for what Corteva alone might owe, and the thousands of pending lawsuits against former DuPont entities have not been resolved. What is clear is that the Vylor spinoff has now made the liability allocation question unavoidable, and the Indiana case will be closely watched by any company managing legacy chemical exposure through corporate restructuring.
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