3M Faces Potentially Billions in Liabilities Over $7.63 Earplugs

Jun 26, 2022

Company to begin court-ordered settlement talks over military earplugs, following lawsuits by thousands of veterans

More than 100,000 U.S. military veterans have filed lawsuits against Minnesota-based 3M over hearing damage linked to what they claim are defects in the company’s military-grade earplugs. The company faces billions of dollars in potential costs from legal settlements or trials after soldiers alleged they returned from war with hearing damage due to the earplugs, which the government bought for around $7.63 a pair.

3M is set to begin court-ordered negotiations next month with lawyers representing soldiers who used the earplugs. The lawsuits are weighing on 3M shares, analysts said, and signal a warning to other manufacturers that liability risks may outweigh the gains from making protective products.

Earplug cases from across the country, involving dozens of lawyers, have been consolidated into a multidistrict litigation based in Florida. There are currently around 107,000 active cases and an additional 127,000 cases that could move over to the active list if filing fees are paid and other steps are taken.

3M said the earplugs work when soldiers are given proper training and use them as intended. The company also claimed it has a legal protection known as a government contractor defense, meaning that a supplier can’t be held liable for manufacturing a product that the government requested.

Eric Rucker, a 3M attorney, said the military is continuing to use newer versions of the 3M earplugs. “The product does work,” he said. “It was designed based on our collaboration with the military.”

Bryan Aylstock, the court-appointed lead lawyer for the plaintiffs, said soldiers have hearing damage and ringing in the ears, known as tinnitus, after using the product. “This is a bad earplug,” he said. “Most juries look at the evidence and they award significant damages.”

Soldiers are given a hearing exam when they first join the military and annual exams afterward, which allows their hearing damage to be documented. At issue in the cases is whether soldiers’ hearing issues are due to allegedly faulty earplugs, not wearing them enough, or something else entirely.

The lawsuits, which also include a smaller number of consumers and police plaintiffs, started after 3M settled a case with the Justice Department. In July 2018, 3M agreed to pay $9.1 million to the U.S. government to resolve allegations that it knowingly sold the earplugs to the military without disclosing defects. 3M denied any wrongdoing or liability.

Earlier this year, 3M appealed the ruling of a federal judge in Florida that the contractor defense doesn’t apply because the military didn’t offer reasonably precise specifications for the product. The U.S. Chamber of Commerce has supported 3M’s appeal, saying that weakening of the contractor defense could deter companies from making products for the military.

Read the full article at the Wall Street Journal