v3.26.1
Commitments and Contingencies
6 Months Ended
Jun. 30, 2026
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies Commitments and Contingencies
H2O America and its subsidiaries are subject to ordinary routine litigation incidental to its business.
In October 2023, CWC, a subsidiary of H2O America, was named as a defendant in a putative class action lawsuit alleging that the water provided by CWC contained contaminants. The case is currently pending in the State of Connecticut Superior Court. CWC is vigorously defending itself in this lawsuit.
SJWC and CWC are plaintiffs in a lawsuit against manufacturers of certain PFAS compounds for damages, contribution and reimbursement of costs incurred and continuing to be incurred to address the presence of such PFAS compounds in public water supply systems owned and operated by these utility subsidiaries and throughout their respective service areas. The lawsuit is part of a Multi-District Litigation (“MDL”) that commenced on December 7, 2018 in the United States District Court for the District of South Carolina. MWC has submitted timely claims as a settlement class member.
On February 8, 2024, the MDL court approved settlements involving defendants The Chemours Company, Corteva, Inc., and DuPont de Nemours, Inc. to resolve claims brought in the MDL against them by public water systems, including SJWC and CWC. On March 29, 2024, the MDL court approved a similar settlement involving defendant 3M Company. On November 22, 2024, the MDL court approved settlements involving defendants Tyco Fire Products LP and BASF Corporation. H2O America is entitled to a portion of the settlements and is monitoring and evaluating the ongoing litigation and settlement activity with the PFAS manufacturers for potential impacts to the various claims that these utility subsidiaries have asserted.
For the three and six months ended June 30, 2026, the Company received $11.0 million from legal settlements with Tyco Fire Products LP, BASF Corporation, and 3M Company related to PFAS contamination, allocated as follows: SJWC received $7.4 million; CWC received $3.5 million; and MWC received $0.1 million, which includes $0.1 million payable to contract operators. For the three and six months ended June 30, 2025, the Company received $6.4 million in cash proceeds from a legal settlement with 3M Company related to PFAS contamination. These proceeds were allocated as follows: SJWC received $4.4 million; CWC received $1.9 million; and MWC received $0.1 million, which includes $0.1 million payable to contract operators. As of June 30, 2026, the Company has received aggregate cash proceeds of $36.1 million from MDL court approved settlements. The proceeds have been allocated as follows: SJWC received $24.4 million; CWC received $11.1 million; and MWC received $0.6 million, which includes $0.4 million payable to contract operators. The proceeds are compensatory in nature and are intended to compensate the Company for costs incurred, or to be incurred, to address the presence of PFAS compounds in public water supply systems or to be refunded to customers through rate reductions, and have been recorded as a regulatory liability subject to regulatory approval.
H2O America is entitled to receive additional cash proceeds from 3M Company in the subsequent seven years, pursuant to the terms of the settlement agreement. The total estimated proceeds to be received during this period are approximately $5.7 million.
H2O America is monitoring and evaluating the ongoing litigation and settlement activity with the PFAS manufacturers for potential impacts to the various claims that these utility subsidiaries have asserted.