3M Company tentatively agreed to pay more than $5.5 billion The company aims to settle more than 300,000 lawsuits alleging it sold defective combat earbuds to the U.S. military, the people said.

The settlement would avoid greater potential liability that 3M had tried to contain through a contentious bankruptcy case that ultimately failed. Some financial analysts expect 3M to pay roughly half of the $10 billion in damages over allegations that the earbuds failed to adequately protect military members’ hearing.

Bloomberg information had estimated the company’s potential liabilities at as much as $9.5 billion, while analysts barclays bank Estimates are around $8 billion.

“It sounds like 3M has negotiated a pretty good deal for itself because this lawsuit has been going on for most of the past decade,” said Carl Tobias, a law professor at the University of Richmond who teaches product liability cases. It haunted them all the time.”

A 3M representative said the company does not comment on rumor or speculation.

costly verdict

The agreement would end a series of lawsuits facing the St. Paul, Minnesota-based company, though it has faced thousands of other lawsuits over the years. PFAS “Chemicals Forever” It can cost several times more than an earbud deal to settle. So far, 3M has lost 10 of 16 early trials of earbuds, and more than a dozen service members have won more than $250 million in damages.

In a recent trial, a Florida jury ordered the manufacturer to pay U.S. Army veteran James Beale in 2022 $77.5 million Hearing loss due to earplugs. Bill, who tested the weapon over a four-year period starting in 2005, said he developed hearing loss and tinnitus (a buzzing or hissing sensation in the ears).

read more: 3M earbuds judge orders out of bankruptcy court for mediation

Hundreds of thousands of lawsuits have been consolidated into multidistrict lawsuits before a federal judge in Florida for pretrial information exchange and test trials, according to federal court records. In the lawsuit, current and former military members claim 3M knew its earbuds were too short to work effectively and failed to warn the US government or users or take steps to fix the product.

Under the terms of the settlement, the maker of popular consumer products such as Scotch tape and post-it notes will pay the money over five years, the people said. The people spoke on condition of anonymity because they were not authorized to speak publicly about the agreement. . 3M’s board still has to approve the deal, they said.

bankruptcy strategy

3M has attempted to aviation technology The department will seek Chapter 11 protection from creditors in 2021 to gain control of the case. Critics, including law professors and consumer advocates, have criticized the practice as an example of for-profit companies using the process as a shield instead of filing for bankruptcy themselves.

In June, a bankruptcy judge dismissed Aearo’s case, arguing that 3M was not in financial distress and was not fit to use the bankruptcy regime to manage the lawsuit. Aearo has appealed the ruling.similar move Johnson & Johnson This year, a bankruptcy application to resolve a cancer case linked to baby powder was denied.

read more: J&J court loss undercuts tactics used by 3M, Georgia-Pacific

As 3M’s bankruptcy strategy falters, the company’s lawyers and military seek a mediation settlement ordered by U.S. District Judge Casey Rodgers, who oversees the earbud lawsuit. Rogers, who served in the Army from 1985 to 1987, ordered 3M Chief Executive Mike Roman to travel to Florida in May to negotiate.

According to the lawsuit, the earbuds were defective for 12 years beginning in 2003. Government records show that in 2012, the Veterans Administration received 971,990 claims for tinnitus. Experts estimate that such claims are increasing by 15 percent each year.

The earbuds aren’t 3M’s first product. In 2018, following a whistleblower lawsuit, the company agreed to pay $9.1 million to settle civil charges from the U.S. Department of Justice that it failed to disclose deficiencies it knew about to the military.

As for the Permanent Chemicals lawsuit, 3M has agreed to pay up to $12.5 billion to clean up drinking water supplies across the United States contaminated by these substances.

The earplug case is 3M Product Liability Action, No. 19-md-2885, US District Court for the Northern District of Florida (Pensacola).


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