diff --git a/src/main/java/org/broadinstitute/hellbender/tools/walkers/haplotypecaller/PartiallyDeterminedHaplotypeComputationEngine.java b/src/main/java/org/broadinstitute/hellbender/tools/walkers/haplotypecaller/PartiallyDeterminedHaplotypeComputationEngine.java
index 76925f943bb..0771da7380d 100644
--- a/src/main/java/org/broadinstitute/hellbender/tools/walkers/haplotypecaller/PartiallyDeterminedHaplotypeComputationEngine.java
+++ b/src/main/java/org/broadinstitute/hellbender/tools/walkers/haplotypecaller/PartiallyDeterminedHaplotypeComputationEngine.java
@@ -20,6 +20,10 @@
 import org.broadinstitute.hellbender.utils.read.CigarBuilder;
 import org.broadinstitute.hellbender.utils.read.CigarUtils;
 import org.broadinstitute.hellbender.utils.smithwaterman.SmithWatermanAligner;
+import org.jgrapht.Graph;
+import org.jgrapht.alg.ConnectivityInspector;
+import org.jgrapht.graph.DefaultEdge;
+import org.jgrapht.graph.SimpleGraph;
 
 import java.util.*;
 import java.util.stream.Collectors;
@@ -87,51 +91,18 @@ public static AssemblyResultSet generatePDHaplotypes(final AssemblyResultSet sou
         final boolean debug = pileupArgs.debugPileupStdout;
 
         final List<Event> eventsInOrder = makeFinalListOfEventsInOrder(sourceSet, badPileupEvents, goodPileupEvents, referenceHaplotype, pileupArgs, debug);
-
         // TODO this is where we filter out if indels > 32 (a heuristic known from DRAGEN that is not implemented here)
 
         Map<Double, List<Event>> eventsByDRAGENCoordinates = eventsInOrder.stream()
                 .collect(Collectors.groupingBy(e -> dragenStart(e), LinkedHashMap::new, Collectors.toList()));
+        eventByDragenCoordinateMessage(referenceHaplotype, debug, eventsByDRAGENCoordinates);
         SortedMap<Integer, List<Event>> variantsByStartPos = eventsInOrder.stream()
                 .collect(Collectors.groupingBy(Event::getStart, TreeMap::new, Collectors.toList()));
-        List<EventGroup> eventGroups = new ArrayList<>();
-        int lastEventEnd = -1;
-        for (Event vc : eventsInOrder) {
-            // Break everything into independent groups (don't worry about transitivitiy right now)
-            Double eventKey = dragenStart(vc) - referenceHaplotype.getStart();
-            if (eventKey <= lastEventEnd + 0.5) {
-                eventGroups.get(eventGroups.size()-1).addEvent(vc);
-            } else {
-                eventGroups.add(new EventGroup(vc));
-            }
-            int newEnd =  (vc.getEnd() - referenceHaplotype.getStart());
-            lastEventEnd = Math.max(newEnd, lastEventEnd);
-        }
-        eventGroupsMessage(referenceHaplotype, debug, eventsByDRAGENCoordinates);
-
-        // Iterate over all events starting with all indels
 
         List<List<Event>> disallowedPairs = smithWatermanRealignPairsOfVariantsForEquivalentEvents(referenceHaplotype, aligner, args.getHaplotypeToReferenceSWParameters(), debug, eventsInOrder);
         dragenDisallowedGroupsMessage(referenceHaplotype.getStart(), debug, disallowedPairs);
-        Utils.printIf(debug, () -> "Event groups before merging:\n"+eventGroups.stream().map(eg -> eg.toDisplayString(referenceHaplotype.getStart())).collect(Collectors.joining("\n")));
-
-        //Now that we have the disallowed groups, lets merge any of them from separate groups:
-        //TODO this is not an efficient way of doing this
-        for (List<Event> pair : disallowedPairs) {
-            EventGroup eventGrpLeft = null;
-            for (Event event : pair) {
-                EventGroup grpForEvent = eventGroups.stream().filter(grp -> grp.contains(event)).findFirst().get();
-                // If the event isn't in the same event group as its predecessor, merge this group with that one and
-                if (eventGrpLeft != grpForEvent) {
-                    if (eventGrpLeft == null) {
-                        eventGrpLeft = grpForEvent;
-                    } else {
-                        eventGrpLeft.mergeEvent(grpForEvent);
-                        eventGroups.remove(grpForEvent);
-                    }
-                }
-            }
-        }
+
+        final List<EventGroup> eventGroups = getEventGroupClusters(eventsInOrder, disallowedPairs);
         Utils.printIf(debug,() -> "Event groups after merging:\n"+eventGroups.stream().map(eg -> eg.toDisplayString(referenceHaplotype.getStart())).collect(Collectors.joining("\n")));
 
         // if any of our merged event groups is too large, abort.
@@ -334,6 +305,42 @@ private static List<Event> makeFinalListOfEventsInOrder(final AssemblyResultSet
         return eventsInOrder;
     }
 
+    /**
+     * Partition events into clusters that must be considered together, either because they overlap or because they belong to the
+     * same mutually exclusive pair or trio.  To find this clustering we calculate the connected components of an undirected graph
+     * with an edge connecting events that overlap or are mutually excluded.
+     */
+    private static List<EventGroup> getEventGroupClusters(List<Event> eventsInOrder, List<List<Event>> disallowedPairsAndTrios) {
+        final Graph<Event, DefaultEdge> graph = new SimpleGraph<>(DefaultEdge.class);
+        eventsInOrder.forEach(graph::addVertex);
+
+        // edges due to overlapping position
+        for (int e1 = 0; e1 < eventsInOrder.size(); e1++) {
+            final Event event1 = eventsInOrder.get(e1);
+            for (int e2 = e1 + 1; e2 < eventsInOrder.size(); e2++) {
+                final Event event2 = eventsInOrder.get(e2);
+                if (dragenOverlap(event1, event2)) {
+                    graph.addEdge(event1, event2);
+                } else if (event2.getStart() > event1.getEnd() + 1){
+                    break;
+                }
+            }
+        }
+
+        // edges due to mutual exclusion
+        for (final List<Event> excludedGroup : disallowedPairsAndTrios) {
+            graph.addEdge(excludedGroup.get(0), excludedGroup.get(1));
+            if (excludedGroup.size() == 3) {
+                graph.addEdge(excludedGroup.get(1), excludedGroup.get(2));
+            }
+        }
+
+        return new ConnectivityInspector<>(graph).connectedSets().stream()
+                .map(set -> set.stream().sorted(Comparator.comparingInt(Event::getStart)).collect(Collectors.toList()))
+                .map(EventGroup::new)
+                .collect(Collectors.toList());
+    }
+
     /**
      * Helper method that handles one of the Heuristics baked by DRAGEN into this artificial haplotype generation code.
      *
@@ -719,7 +726,7 @@ private static class EventGroup {
         // Optimization to save ourselves recomputing the subsets at every point its necessary to do so.
         List<List<Tuple<Event,Boolean>>> cachedEventLists = null;
 
-        public EventGroup(final Event ... events) {
+        public EventGroup(final Collection<Event> events) {
             eventsInBitmapOrder = new ArrayList<>();
             eventSet = new HashSet<>();
 
@@ -903,7 +910,12 @@ private static double dragenStart(final Event event) {
         return event.getStart() + (event.isIndel() ? (event.isSimpleDeletion() ? 1 : 0.5) : 0);
     }
 
-    private static void eventGroupsMessage(final Haplotype referenceHaplotype, final boolean debug, final Map<Double, List<Event>> eventsByDRAGENCoordinates) {
+    private static final boolean dragenOverlap(final Event event1, final Event event2) {
+        return event1.getStart() <= event2.getStart() ?
+                (dragenStart(event2) < event1.getEnd() + 1) : (dragenStart(event1) < event2.getEnd() + 1);
+    }
+
+    private static void eventByDragenCoordinateMessage(final Haplotype referenceHaplotype, final boolean debug, final Map<Double, List<Event>> eventsByDRAGENCoordinates) {
         Utils.printIf(debug, () -> eventsByDRAGENCoordinates.entrySet().stream()
                 .map(e -> String.format("%.1f", e.getKey()) + " -> " + dragenString(e.getValue(),  referenceHaplotype.getStart(),","))
                 .collect(Collectors.joining("\n")));