3M Agrees to Settle Lawsuits Over Defective Earplugs 

3M to pay $6.01B to settle 260K lawsuits over defective earplugs causing hearing loss in US military members. Shares up 5% on settlement speculation.

According to a source familiar with the matter, 3M (MMM.N) has agreed to pay $6.01 billion to resolve over 260,000 lawsuits filed by current and former U.S. military service members who claim they experienced hearing loss as a result of wearing the company’s earplugs.

In an earlier attempt to restrict corporate liability, 3M had tried – and failed – to have the lawsuits, which had ballooned into the largest mass tort litigation in U.S. history, transferred to bankruptcy court.

The money will be distributed mostly over the following five years, the source said.

On Monday, shares of 3M were up 5% due to speculation that a settlement will soon be reached. The potential liability of the firm from the S earplug litigation has been estimated by some experts to be as high as $10 billion.

There was no quick response to requests for comment from a 3M representative or the attorneys representing the service members.

The business 3M bought in 2008 that created the technology behind the Combat Arms earplugs is called Aearo Technologies. The United States military deployed them to Afghanistan and Iraq for use in both training and actual combat from 2003 to 2015.

In the lawsuits, the plaintiffs allege that the manufacturer concealed defects in the earplugs’ design, manipulated test findings, and failed to provide adequate directions for their usage, all of which caused hearing damage.

In 2019, all of the lawsuits were brought before U.S. District Judge M. Casey Rodgers in federal court in Pensacola, Florida. At its height, the litigation was responsible for around 30% of all cases filed in federal courts across the country.

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13 plaintiffs have been awarded a total of around $265 million as a result of the 16 earplug lawsuits that have gone to trial, 10 of which were lost by 3M.

In July 2022, Aearo filed for bankruptcy, and 3M pledged $1 billion to cover the company’s liabilities related to the earplug lawsuits.

After hundreds of “unvetted” claims bloated the court’s docket, 3M alleged that the mass tort litigation was unfair because Rodgers had withheld scientific material beneficial to the firm.

In June, however, a bankruptcy judge ruled that Aearo’s financial difficulties did not warrant a bankruptcy filing.

Earlier this summer, 3M announced a tentative $10.3 billion settlement with a number of U.S. public water agencies to resolve claims of water pollution by per- and polyfluoroalkyl substances (PFAS), sometimes known as “forever chemicals.” The settlement announced on Monday comes just two months after the announcement.

Twenty-two states and territories in the United States are suing to nullify the agreement, arguing that it does not go far enough in holding the firm accountable.

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