The format_string function in lib/weblib.php caches the strings in a static variable however the key it generates for the cache doesn't include the 'filter' option which means that a request to format a string with filters won't actually apply the filters if format_string has already been called on that string without filters.

E.g.
format_string('some string', true, ['context' => 1, 'filter' => false]);
and
format_string('some string', true, ['context' => 1, 'filter' => true]);
produce the same result, even though the second call requests that the filters apply.