Aug. 28 (Reuters) – 3M (MMM.N) on Monday agreed to pay $6.01 billion to settle nearly 260,000 lawsuits filed by current and former U.S. military service members who say they have suffered hearing loss from using the company’s earplugs. , according to a person familiar with the matter. the agreement.
The deal follows a failed attempt by 3M earlier this year to move the lawsuit, which has developed into the largest class action lawsuit in US history, to bankruptcy court in hopes of limiting its liability.
The person familiar with the agreement said the money will mostly be paid out over the next five years.
3M shares rose 5% Monday on earlier reports that a settlement was imminent. Some analysts have estimated the company’s potential liability from the earplugs lawsuit as high as $10 billion.
A 3M spokesperson and attorneys for service members did not immediately respond to requests for comment.
Combat Arms earplugs are manufactured by Aearo Technologies, a company acquired by 3M in 2008. The US military used them in training and combat from 2003 to 2015, including in Afghanistan and Iraq.
Plaintiffs in the lawsuits allege that the company concealed design flaws, manipulated test results and failed to provide instructions for the proper use of the earplugs, resulting in hearing damage.
The 3M logo is seen at its global headquarters in Maplewood, Minnesota, US on March 4, 2020. Photo: Nicholas Pfossi/Reuters. Obtain licensing rights
The lawsuits were merged before US District Judge M. Casey Rodgers in Pensacola, Florida federal court in 2019. At its peak, the lawsuit accounted for about 30% of all federal court cases nationwide.
Of the 16 earplug-related cases that went to trial, 3M lost 10, with a total of $265 million awarded to 13 plaintiffs.
Aearo filed for bankruptcy in July 2022, with 3M pledging $1 billion to fund its liabilities arising from the earplug-related lawsuits.
3M argued that the class action lawsuit was unfair because Rodgers kept scientific evidence favorable to the company out of trials and allowed thousands of “unexamined” claims to inflate the court’s agenda.
However, in June a bankruptcy judge denied the bankruptcy application, finding that Aero was not in sufficient financial hardship to justify it.
Monday’s settlement comes just two months after 3M announced a preliminary $10.3 billion deal with a consortium of US public water systems to resolve allegations of water contamination with perfluoroalkyl and polyfluoroalkyl substances, or PFAS, better known as the “forever chemicals.”
The agreement is not final, and 22 US states and territories are seeking to block it, saying they do not adequately hold the company responsible.
Reporting by Brendan Pearson in New York; Editing by Alexia Garamfalvi and Bill Berkrot
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