A recent incident at the Eastman Chemical Company's Kingsport site involved a 20 foot section of PTFE-lined pipe that failed at a flange joint, resulting in a leak, but no injuries. Initial scene observations indicated that a section of the liner had disintegrated, leaning an open space where the liner forms the flange gasket. More detailed analysis showed that the entire liner was intact, but had retracted approximately 2.5 inches into the pipe. This paper will discuss the physical mechanisms (thermal cycling, viscoelastic properties of PTFE) that explain the liner retraction, as well as the installation factors (electrical tracing, liner length), which influenced the timing and nature of the failure mechanism.