MDL Judge Pushes 3M Earplug Settlement Negotiations During Stay of Litigation

Oct 31, 2022

In advance of issuing an anticipated ruling about whether 3M Company can be held independently liable for Combat Arms Earplugs developed by its now-bankrupt subsidiary, the U.S. District Judge presiding over the litigation has announced a stay for all deadlines while any interlocutory appeal of the ruling is pursued, and ordered the parties to continue meeting for earplug hearing loss settlement negotiations to try to resolve the claims.

More than 230,000 U.S. military veterans are currently pursuing a 3M earplug lawsuit over hearing loss or tinnitus following service, which has been blamed on a defective design used with reversible earplugs that were standard issue to all service members between 2004 and 2015.

The Combat Arms Earplugs version 2 (CAEv2) were initially developed by Aearo Technologies, which was acquired 3M Company in 2008. 3M Company “upstreamed” the entire Aearo hearing protection business into itself in 2010, and continued to sell the defective earplugs to the U.S. government without warning about known problems that caused them to commonly fall out of the ear canal.

Given common questions of fact and law raised in the litigation, all lawsuits over hearing loss caused by the military earplugs have been centralized for the past three and a half years before U.S. District Judge Casey Rodgers in the Northern District of Florida, as part of an MDL or multidistrict litigation.

Throughout the proceedings, 3M Company has defended the cases brought against both itself and it’s Aearo subsidiary, but has been hit with a series of massive verdicts in early “bellwether” trials scheduled to help the parties gauge how juries were likely to respond to certain evidence and testimony that would be repeated throughout the litigation.

Prior to remanding hundreds of individual cases to U.S. District Courts nationwide for separate trials, Judge Rodgers ordered the parties to engage in 3M earplug settlement negotiations with a court-appointed mediator earlier this year. However, rather than attempting to resolve the claims, 3M Company announced that it was attempting a to shift all liability for the earplugs back to its wholly owned Aearo subsidiary, and placing that entity into bankruptcy protection.

Plaintiffs Challenge 3M’s New Earplug Lawsuit Liability Arguments

After a federal bankruptcy judge determined that the Aearo Technologies subsidiary does not prevent earplug hearing loss lawsuits from moving forward against 3M Company, the manufacturer has taken the controversial stance of arguing that it can not be held independently liable for the earplugs developed by Aearo, even though it never raised that defense earlier in the litigation.

In early October, hundreds of plaintiffs included in a first wave of claims being prepared for remand to U.S. District Courts nationwide in the coming months filed a motion for summary judgment against 3M, seeking to prevent the company from now arguing that it is not independently liable for the earplug-related injuries.

In a scathing court order (PDF) issued on October 27, Judge Rodgers announced that all deadlines will be paused in four waves of cases being prepared for remand and trial until this central issue is resolved. However, the tenor and tone of the order suggests that Judge Rodgers is unlikely to allow 3M to shield itself from liability at this late date.

“[F]or the first time in the three-and-a-half year history of the MDL, 3M paradoxically claims that Aearo alone (now strategically steered into bankruptcy) is the bogeyman and 3M itself has neither independent nor successor liability for any alleged CAEv2- related injuries,” Judge Rodgers wrote. “Although the briefing was filed in the context of the Wave 1 cases, it presents liability issues common to all cases in the MDL, the resolution of which will affect how all of those cases may proceed.”

The order indicates that Judge Rodgers plans to issue a decision about 3M’s independent liability soon, and that the court will certify its decision for an interlocutory appeal, allowing the ruling to be challenged to the U.S. Court of Appeals before additional cases are remanded to courts nationwide for individual trial dates.

“While this will inject further delay into the litigation, and continued uncertainty about the claims and/or defenses, appellate review of the Court’s decision – if desired by either side – needs to occur before thousands of cases are remanded to transferor courts around the country for trial.”

Judge Rodgers’ order immediately stays all Wave 1 cases, pauses Wave 2 and Wave 3 cases following the close of expert discovery in those waves, and will pause Wave 4 cases after November 7, which is the deadline for written discovery requests and production of online records.

Additional 3M Earplug Settlement Negotiations Ordered

As part of the order issued last week, Judge Rodgers also ordered the parties to “fully engage in ongoing settlement negotiations” during the stay of the wave process.

Last month, the Court reported that a series of 3M earplug settlement negotiations held in late September were “worthwhile and productive”, ordering the parties to continue meeting with Special Master Randi Ellis this month, to try to settle the litigation.

“Beginning in November 2022, the parties must convene for monthly settlement conferences at the United States District Court,” according to the order, which specifically directs certain attorneys and representatives from 3M Company to personally attend with “full settlement authority, subject to Board approval.”

Even though the litigation will be mostly on pause and 3M Company will not face the impending pressure of additional jury verdicts, Judge Rodgers ordered the parties to make a good faith effort in negotiations, indicating the confidentiality of those discussions must be maintained.

Judge Rodgers responds to 3M Earplug MDL Criticism

As part of the recent bankruptcy filing, 3M Company has aired a number of grievances and complaints about how the 3M earplug MDL has been managed.

“Much vitriol has been directed at the undersigned in various forums of late for a range of supposed failings in this MDL,” Judge Rodgers wrote in the order pausing the litigation. “The vilification, while frequently personal and provocative, generally amounts to nothing more than the overzealous and deceptive public posturing that has unfortunately seeped into the adversarial process in recent years, a response to which is beneath the dignity of the Court.”

However, Judge Rodgers pushed back against 3M’s claims challenging the integrity of the bellwether process, where small groups of representative claims have been selected for early trial dates. 3M lost 10 out of 16 trials, and Judge Rodgers outlined the reasons the process has been “beyond reproach.”

She indicated the cases were selected fairly and tried fairly from a bellwether selection process developed by consensus, and that the cases were heard by a diverse combination of judges and jury pools.

“No other MDL litigants in this country have obtained more objectively representative and reliable data points about individual claims, and the broader whole, in this timeframe, than the parties in this litigation,” Judge Rodgers wrote. “Whether they use the information honestly and responsibly going forward is, of course, up to them.”

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