Vylor Lawsuit Stayed: States' $40 Billion PFAS Fraudulent-Transfer Case Now Waits on the JPML

The Vylor lawsuit, a fraudulent-transfer case brought by 15 states and Guam against EIDP Inc. (the former E.I. du Pont de Nemours, or "Old DuPont"), Corteva and the newly spun-off seed company Vylor, was stayed by an Indiana federal court on October 27, 2026 until the Judicial Panel on Multidistrict Litigation decides whether to send it to the firefighting-foam MDL in South Carolina. The pause follows a Seventh Circuit order on October 20 that suspended the temporary restraining order the states had won on October 9, so for now nothing stops Corteva or Vylor from paying dividends, buying back shares or moving assets in the ordinary course.

That sequence, filed, frozen, unfrozen and then parked in under four weeks, turns a headline about a $40 billion "shell game" into a procedural contest that will shape where PFAS creditors can chase corporate assets. The rest of this piece walks through the claims, the four court orders, the JPML standard that will decide the transfer motion, and what the Vylor lawsuit means for PFAS personal injury claimants, state attorneys general and defense counsel structuring spinoffs.

What is the Vylor lawsuit about?

The Vylor lawsuit asks a court to unwind, or at least claw back value from, Corteva's October 1, 2026 separation of its seed and genetics business, anchored by the Pioneer brand, into Vylor, Inc., a separately traded company listed on the New York Stock Exchange under the ticker VYLR. Corteva shareholders received one Vylor share for each Corteva share held on the September 24, 2026 record date, and Corteva's board approved the separation on September 14.

The plaintiffs say the deal stripped Old DuPont of its most valuable operating assets while leaving behind its historical liability for per- and polyfluoroalkyl substances. According to the complaint, Old DuPont parted with assets worth roughly $40 billion and received about $5 billion in value back through a distribution and debt exchange. Reuters' account of the filing described the states' theory as Vylor taking the most profitable parts of the business without assuming any responsibility for PFAS.

The states plead two counts under Indiana's version of the Uniform Voidable Transactions Act:

• Count I, actual fraud: the transfer was made with actual intent to hinder, delay or defraud creditors, including the states themselves as PFAS claimants.
• Count II, constructive fraud: Old DuPont did not receive reasonably equivalent value and was insolvent, or was rendered insolvent, by the transfer.

The relief sought is equitable and preservation-focused: an order freezing Vylor's assets and barring Old DuPont and Corteva from spending what remains on dividends and buybacks, so that a future PFAS judgment or settlement has something to attach to. Indiana Attorney General Todd Rokita, who leads the coalition, branded the transaction a "shell game" in announcing the case.

Corteva has rejected the suit as "entirely without merit," says the states rely on "novel legal theories and groundless assumptions," and stresses that Corteva itself never made or sold PFAS products. The company told investors it strongly contests both the legal and factual basis for the relief sought.

Which states are suing Corteva, DuPont and Vylor?

The coalition is Indiana plus Alaska, Florida, Maine, Maryland, Massachusetts, New Hampshire, New Mexico, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont and Washington, together with the territory of Guam. That is 15 states and one territory; several attorneys general describe it as a "16-state" coalition by counting Guam, and Corteva's own securities filing counted Indiana, 13 other states and one territory for an earlier motion, a difference that appears to reflect states joining after the initial papers. New Hampshire, for example, announced its participation separately.

The coalition is bipartisan. Indiana, Texas, Florida, Alaska and Tennessee have Republican attorneys general; Maryland, Oregon, Vermont, Washington and others have Democratic ones. That matters politically, because it makes the case harder to frame as a partisan attack on agriculture, and practically, because many of the same states are already PFAS plaintiffs in their own natural-resource-damages suits.

Who is who in the Vylor lawsuit

Party	Role	What it is
EIDP, Inc. ("Old DuPont")	Defendant, alleged transferor	The historical E.I. du Pont de Nemours entity that made PFAS-containing products for decades; now a Corteva subsidiary
Corteva, Inc.	Defendant	Old DuPont's parent since the 2019 DowDuPont break-up; after October 1 a crop-protection and digital business
Vylor, Inc.	Defendant, alleged transferee	Seed and genetics company spun off October 1, 2026; NYSE: VYLR
15 states and Guam	Plaintiffs, creditors	PFAS claimants under state natural-resource, nuisance and consumer laws
Chemours	Not a party	2015 DuPont spinoff that shares legacy PFAS costs under a 2021 memorandum of understanding

Timeline: from spinoff announcement to JPML stay

The Vylor lawsuit is moving on three tracks at once: the Indiana federal trial court, the Seventh Circuit and the JPML. The dates below are drawn from the Seventh Circuit docket, Corteva's securities filings and contemporaneous trade reporting.

Date	Event	Forum
Dec. 4, 2025	Corteva's plan to create a separate seed company, later named Vylor, is public	—
Sept. 14, 2026	Corteva board approves the separation	—
Sept. 15, 2026	Judge Richard Gergel denies California's emergency motion to halt the spinoff, filed 17 days before closing	D.S.C. (AFFF MDL 2873)
Sept. 24, 2026	Record date for the Vylor share distribution	—
Oct. 1, 2026	Spinoff closes; 15 states and Guam sue in Indiana state court (Marion County)	Indiana Commercial Court
Early Oct. 2026	Old DuPont removes the case to federal court, citing federal officer jurisdiction, per a Fox Rothschild client alert	S.D. Ind.
Oct. 9, 2026	Judge Tanya Walton Pratt grants a TRO barring dividends, buybacks and non-ordinary-course disposals	S.D. Ind.
Oct. 10, 2026	Court stays its own TRO for 14 days so the companies can seek appellate relief	S.D. Ind.
Oct. 13–14, 2026	Emergency motion for stay pending appeal and motion to expedite filed, No. 26-3075	7th Cir.
Oct. 16, 2026	Defendants' appeal and notice of a motion to transfer to the AFFF MDL reported	7th Cir. / JPML
Oct. 20, 2026	Split Seventh Circuit panel stays the TRO pending appeal	7th Cir.
Oct. 27, 2026	Indiana federal court stays the case pending the JPML's transfer decision	S.D. Ind.

Why was the Vylor lawsuit stayed?

The Vylor lawsuit was stayed because the defendants asked the JPML to transfer it into the AFFF MDL and asked the Indiana court not to keep litigating while that request is pending; the court agreed, Mealey's reported on October 27, granting the motion brought by the three DuPont-linked companies. A stay pending a transfer decision is a routine case-management tool. It avoids the risk that a transferor court issues rulings, on remand, on preliminary relief or on discovery, that the transferee judge would then have to unwind, and it conserves resources if the case is about to move.

The stay is not a merits ruling. It does not find that the states' fraudulent-transfer theory is weak, and it does not dissolve the restraining order; that order was already stayed by the Seventh Circuit. But it does mean that, in practice, nothing of substance will happen in Indianapolis until the Panel acts.

Two pieces of the procedural history explain why the defendants want South Carolina. First, Old DuPont removed the case under the federal officer removal statute, 28 U.S.C. § 1442, according to the Fox Rothschild alert, and has signaled that it will assert the government contractor defense, the same defense manufacturers have pressed in AFFF cases on the theory that military-specification foam was made at the federal government's direction. Federal officer removal requires a colorable federal defense, and that defense is already being litigated before Judge Gergel. Second, Judge Gergel has already heard, and denied, California's attempt to stop the same spinoff inside the MDL, so the defendants can argue that a court familiar with the transaction and the underlying PFAS exposure is the natural home for any fight over it.

Will the Vylor case be transferred to the AFFF MDL?

Whether the Vylor case is transferred to the AFFF MDL is genuinely open, because the JPML has been selective about adding non-traditional cases to MDL 2873. The Panel transfers actions where a plaintiff alleges injury from PFAS that traces to the manufacture, use or disposal of aqueous film-forming foam. It has repeatedly refused transfer where the AFFF link is speculative or where the case would distract from the MDL's core work. In a 2023 order denying transfer, the Panel said the party seeking to add such an action "bears a significant burden to persuade us that transfer is appropriate and will not undermine the efficient progress of the AFFF MDL."

The Vylor lawsuit does not plead a single exposure, a single water system or a single injury. It is a creditor's remedy case about corporate structure and solvency. That cuts both ways:

• For transfer: the states' standing as creditors depends on their PFAS claims, many of which are AFFF-related; Old DuPont's solvency turns on its PFAS exposure, which the MDL court knows better than any other; the government contractor defense that supports removal is pending there; and Judge Gergel has already ruled on a motion attacking the same transaction. The Panel has also said, in a June 2026 order on a Maryland action, that the MDL is not limited to cases alleging only AFFF contamination.
• Against transfer: the claims arise under Indiana's voidable-transactions statute, not products liability; the core questions, valuation, insolvency and intent, have nothing to do with exposure or causation; and the Panel has declined to treat every dispute touching PFAS as AFFF litigation, refusing transfer where contamination from AFFF and non-AFFF sources was mixed or the AFFF connection was speculative.

A practical point favors speed. The JPML usually decides contested transfer motions after one of its bimonthly hearing sessions, and no session date for this motion had been published by November 1, 2026. Unless the Panel issues a conditional transfer order that no party opposes, which is unlikely here because the states will resist, the case could sit for several months.

Can Corteva and Vylor pay dividends while the lawsuit is pending?

Yes, Corteva and Vylor can currently pay dividends and repurchase shares, because the Seventh Circuit stayed the October 9 restraining order pending appeal on October 20, and the Indiana case itself is now stayed. The TRO had barred each company from paying dividends, repurchasing common stock or disposing of assets outside the ordinary course without court approval. Before the appellate stay, the district court relied on Corteva's representation that it would not declare dividends or buy back shares while its emergency motion was under review.

The appellate stay was granted by a divided panel, and the underlying appeal remains pending under No. 26-3075, with the companies having asked for expedited briefing. Market commentary has flagged that the post-separation Corteva has a $0.05 per-share quarterly dividend scheduled for payment on December 15, 2026 with a December 1 record date. If the Seventh Circuit were to affirm the TRO before then, the payment question would return; if it reverses, or if the case is transferred and the MDL judge takes a different view, the freeze may never come back.

Because a TRO is by design short-lived, the more consequential question is whether the states can obtain a preliminary injunction on the same terms. That motion is effectively on hold while the transfer fight runs.

Did a court block the Corteva Vylor spinoff?

No court blocked the Corteva Vylor spinoff; it closed as scheduled on October 1, 2026. California, supported by 18 other states, had asked Judge Gergel in the AFFF MDL for a temporary restraining order and injunction to stop the deal. Judge Gergel denied the request in a September 15 order, citing "multiple reasons," including that California had known of the planned separation since at least December 4, 2025 but waited until 17 days before closing to move. Inside EPA characterized the denial as procedural, and California's later appellate effort, routed through the Fourth Circuit and remanded, also failed before the closing date.

The Indiana restraining order came eight days after the spinoff closed, and even then it did not purport to reverse the separation. Corteva's own disclosure states that the order did not affect completion of the separation. What the states sought, and briefly obtained, was a freeze on what the separated companies could do with their assets afterward.

What is a fraudulent transfer claim under the Uniform Voidable Transactions Act?

A fraudulent transfer claim under the Uniform Voidable Transactions Act lets a creditor set aside, or recover the value of, a transfer that a debtor made either with intent to defeat creditors or without receiving reasonably equivalent value while insolvent. Indiana, like most states, has adopted the uniform act, which renamed the older Uniform Fraudulent Transfer Act to emphasize that no actual fraud is required for the constructive branch.

The two theories in the Vylor lawsuit work differently:

Element	Actual-intent claim (Count I)	Constructive-fraud claim (Count II)
Debtor's state of mind	Must show intent to hinder, delay or defraud	Irrelevant
How intent is proved	"Badges of fraud": insider transfer, debtor retained control, threatened suits, transfer of substantially all assets, inadequate consideration	Not required
Value received	Relevant as a badge	Must show debtor did not get reasonably equivalent value
Solvency	Relevant as a badge	Must show insolvency at, or caused by, the transfer, or unreasonably small capital
Who can be reached	First transferee (Vylor) and subsequent transferees, subject to good-faith defenses	Same
Remedies	Avoidance, attachment, injunction against further disposition, money judgment	Same

The constructive theory is where the case will likely be won or lost. Courthouse News reported that the states' expert had "plausibly" shown that Old DuPont became insolvent immediately after the separation, which was enough for a TRO. The defendants can be expected to argue that EIDP retains substantial assets, remains backed by cost-sharing commitments, and received real value in the exchange. Whether contingent, unliquidated PFAS claims can be valued with enough confidence to render a multinational insolvent is the central evidentiary battle, and it is the same question that has dominated asbestos and talc restructurings.

The doctrine has deep roots in mass-tort litigation. The Texas Two-Step bankruptcies of the last decade drew fraudulent-transfer challenges built on the same statute, and Chemours' own securities filings acknowledge that many PFAS actions have included fraudulent-transfer allegations aimed at the 2015 spinoff that created Chemours. The Vylor lawsuit is notable because the creditors are sovereign states acting before any bankruptcy filing, aiming to lock assets in place while the underlying PFAS claims are still being litigated.

The PFAS liability backdrop: why creditors care about Old DuPont's balance sheet

The value of any PFAS judgment against Old DuPont depends on who stands behind it. Three facts frame the exposure.

First, the January 2021 memorandum of understanding among Chemours, DuPont de Nemours, Corteva and EIDP splits qualifying legacy PFAS costs 50/50 between Chemours on one side and DuPont and Corteva on the other, up to an aggregate $4 billion, through the earlier of December 31, 2040 or the cap being reached. That arrangement includes escrow funding, but it is capped, and the states argue that their claims, together with others, could far exceed it.

Second, the AFFF MDL remains enormous. The JPML's October 1, 2026 statistics show 15,264 actions pending in MDL 2873, and no global personal injury settlement exists. The water-provider class settlements, roughly $10.3 billion from 3M and $1.185 billion from DuPont, Chemours and Corteva in 2023, resolved public water system claims, not individual injuries or state natural-resource claims.

Third, state enforcement keeps expanding. Corteva's filings note that New York's attorney general sued 3M, DuPont, Chemours, Corteva and EIDP in July 2026 on public nuisance and consumer-protection theories, and Indiana itself sued 22 PFAS manufacturers in 2024. Every one of those claims looks to the same corporate family for payment, which is why the states moved on the day the spinoff closed.

What it means for PFAS claimants, states, defendants and funders

For PFAS personal injury claimants' counsel: The Vylor lawsuit is a collection case, and its outcome will influence the eventual size of any DuPont-side contribution to an AFFF personal injury settlement. If the case is transferred, the AFFF MDL judge will control both the liability merits and a key fight over the defendants' ability to pay, which could give him added leverage in settlement discussions already proceeding with a court-appointed mediator. Individual claimants are not parties, but leadership in MDL 2873 has an obvious interest in whether the JPML grants transfer and should be expected to weigh in.

For state attorneys general: The October timeline is a lesson in speed and forum. California's MDL motion failed partly because it was late; the Indiana coalition filed on closing day in state court, won a TRO eight days after filing, and then lost it on appeal within 11 more days. Removal under the federal officer statute converted a state-law creditor suit into a federal case with an MDL transfer path. States considering similar suits against other PFAS defendants will weigh whether to plead around federal officer removal, for instance by disclaiming AFFF-related military foam, as some water-provider plaintiffs have done to keep cases out of the MDL.

For defense counsel and corporate drafters: The case confirms that spinoffs by companies with mass tort exposure will be challenged in real time, not years later in bankruptcy. Solvency opinions, the allocation of legacy liabilities in separation agreements, and the size of any retained-liability reserve are now evidence in a preliminary-relief hearing. The Seventh Circuit's split stay suggests appellate judges see room for argument on whether a pre-judgment freeze is appropriate when the underlying claims are unliquidated.

For litigation funders and investors: A pending fraudulent-transfer claim clouds both companies' capital-return plans, even with the freeze lifted. Funders backing PFAS portfolios will track the JPML ruling because the forum will dictate the pace: an MDL court that already manages thousands of cases may move more slowly on a standalone solvency fight than an Indiana judge who had the case to herself.

What to watch next in the Vylor lawsuit

• The JPML's transfer ruling. Watch for a hearing-session order listing the motion, the states' opposition and any position from MDL 2873 leadership.
• The Seventh Circuit merits appeal (No. 26-3075). An expedited decision could reinstate or vacate the TRO; a reasoned opinion would be the first appellate word on pre-judgment asset freezes against a spinoff to protect PFAS creditors.
• Remand. The states can challenge federal officer removal; a remand to Indiana state court would moot the transfer question entirely.
• December 1 and December 15. The Corteva dividend record and payment dates are the first concrete test of whether the companies will return capital while the appeal is pending.
• New joiners and copycat suits. Additional states, water utilities or private PFAS plaintiffs may file their own voidable-transfer claims, or seek to intervene, if the coalition's case stalls.

FAQ

What is the Vylor lawsuit?

It is a fraudulent-transfer suit filed October 1, 2026 by 15 states and Guam against EIDP (Old DuPont), Corteva and Vylor, alleging that Corteva's spinoff of its Pioneer seed business into Vylor moved about $40 billion in assets beyond the reach of PFAS creditors.

Why was the Vylor lawsuit stayed?

An Indiana federal judge stayed the case on October 27, 2026 because the defendants have asked the Judicial Panel on Multidistrict Litigation to transfer it to the AFFF MDL in South Carolina, and the court chose to wait for that decision rather than litigate in parallel.

Is the asset freeze on Corteva and Vylor still in effect?

No. The October 9 temporary restraining order was stayed by the district court on October 10 and then by a split Seventh Circuit panel on October 20 pending appeal, so Corteva and Vylor are not currently barred from paying dividends or buying back shares.

Did the states stop the Corteva Vylor spinoff?

No. The spinoff closed on October 1, 2026 after Judge Richard Gergel denied California's emergency motion in the AFFF MDL on September 15; the later Indiana order targeted post-spinoff asset transfers, not the separation itself.

How does the Vylor lawsuit affect PFAS personal injury claimants?

Individual claimants are not parties, but the case will help determine how much Old DuPont and its affiliates can contribute to any future AFFF personal injury settlement, and a transfer would put that solvency fight before the same judge who manages the 15,264 pending MDL 2873 actions.

What happens next?

The JPML will decide whether to transfer the case, the Seventh Circuit will decide the appeal of the restraining order in No. 26-3075, and the states may seek remand to Indiana state court; any of the three could reset the timetable.