Posted by : Irvin Jackson

An appeals court has been asked to stay all lawsuits against 3M Company, while its Aearo subsidiary goes through a controversial Chapter 11 bankruptcy.

3M Company is asking a U.S. appeals court to overturn a Federal bankruptcy judge’s decision to allow litigation to move forward in hundreds of thousands of Combat Arms earplug lawsuits, which are being pursued against the company by veterans left with hearing damage.

More than 230,000 U.S. military veterans are currently pursuing product liability lawsuits after being left with hearing loss or tinnitus following military service, where they were provided 3M Combat Arms Earplugs as standard issue equipment before deployments between 2004 and 2015. Plaintiffs allege that the earplugs were sold to the U.S. government with a known design defect, which left veterans without adequate ear protectors during combat and training exercises.

The Combat Arms Earplugs version 2 (CAEv2) was initially developed by Aearo Technologies, which was acquired by 3M Company in 2008. 3M Company upstreamed the entire Aearo hearing protection business into itself and continued to sell the defective earplugs 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.

Military service members between 2003 and 2015 may be eligible for a 3M earplug lawsuit payout over hearing damage or tinnitus. Find out if you may be eligible for a hearing loss settlement.

Learn More About this Lawsuit See if you Qualify for a Settlement

Throughout the proceedings, 3M Company has defended the cases brought against both itself and its Aearo subsidiary, never raising any arguments during at least 16 trials that suggested it is not jointly responsible for the design. However, after a number of juries hit the companies with massive verdicts, and facing thousands of additional claims being prepared for trial, 3M Company has made the controversial decision to place Aearo Technologies into bankruptcy, and is attempting to argue that the multi-billion dollar parent company can not be independently held responsible for hearing loss caused by products it sold and profited from for years.

In August, U.S. Bankruptcy Judge Jeffrey J. Graham refused to grant 3M a stay in the litigation despite the bankruptcy filing, indicating the litigation can continue against 3M, despite the bankruptcy filing by Aearo. Judge Graham said Indiana’s bankruptcy laws, where the bankruptcy case is located, do not allow such a pause in the litigation in this case, since 3M Company is also named as a defendant in the litigation.

3M Appeals Combat Arms Lawsuit Bankruptcy Ruling

On December 12, 3M, through its Aearo subsidiary, filed an opening brief (PDF) with the U.S. Court of Appeals for the Seventh Circuit, calling for Judge Graham’s decision to be overturned.

In the brief, Aearo argues that the judge’s decision was contrary to bankruptcy decisions by the Seventh Circuit in the past, by refusing to stay the litigation while Aearo reorganized its debt, without continuing to bleed millions of dollars into the litigation, both from jury verdicts and the other legal costs.

These are precisely the circumstances where the automatic stay applies or a preliminary injunction is warranted either of which will increase the likelihood of a speedy reorganization benefiting all stakeholders, including every claimant entitled to compensation, the brief states. Accordingly, the Court should reverse the bankruptcy court and stay or enjoin the CAEv2 litigation against 3M.

However, critics suggest that the 3M bankruptcy maneuver was done in bad faith, as part of an effort to force injured veterans to accept only pennies on the dollar for the true cost of injuries, by forcing claims through the U.S. bankruptcy process.

December 2022 3M Earplug Lawsuit Update

Recently, 3M has taken the stance that it can not be held independently liable for the earplugs developed by Aearo, which plaintiffs’ lawyers have called an absurd position and the U.S. District Judge presiding over the litigation has suggested is not a position taken in good faith.

In early October, hundreds of plaintiffs included in the 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.

Shortly after, Judge Rodgers issued an order pausing all deadlines in the four 3M earplug lawsuit waves of cases being prepared for remand and trial until the liability issues have been resolved. The tone of the response suggested she would be unlikely to allow 3M to use this liability shield at this point in the litigation. However, a stay was issued to allow an appeals court to adjudicate the issue before more individual cases are set for trial.

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 ongoing settlement negotiations, indicating the confidentiality of those discussions must be maintained.

Tags: 3M Company, Army, Bankruptcy, Combat Arms, Earplugs, Hearing Loss, Tinnitus, Veteran

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Irvin Jackson

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