3M seeks to revive bankruptcy to resolve military earplug mass tort

2023-06-14 04:24

By Dietrich Knauth NEW YORK (Reuters) -A 3M subsidiary appealed the dismissal of its bankruptcy case late Monday, challenging a

By Dietrich Knauth

NEW YORK (Reuters) -A 3M subsidiary appealed the dismissal of its bankruptcy case late Monday, challenging a judge's ruling that it was not in immediate jeopardy from 260,000 lawsuits alleging that 3M military earplugs caused hearing loss for veterans and U.S. service members.

U.S. Bankruptcy Judge Jeffrey Graham in Indianapolis had dismissed Aearo Technologies' bankruptcy on Friday, finding that it was "fatally premature." Despite the "staggering" number of earplug lawsuits, Aearo has significant financial support from 3M and enjoys a "greater degree of financial security than warrants bankruptcy protection," Graham ruled.

The lawsuits, which have been consolidated in federal court in Pensacola, Florida, are the largest mass tort in U.S. history, with nearly 330,000 cases filed and approximately 260,000 pending cases, according to court statistics from May.

3M and Aearo had argued that the earplug litigation had spiraled out of control and could be resolved only in bankruptcy.

"Aearo and 3M disagree with the court’s conclusion, including its opinion that the Aearo Chapter 11 filing was premature," a 3M spokesman said Tuesday.

3M has said the earplugs are safe and effective and denied allegations that they caused hearing loss. It has previously said that it was prepared to fight the earplug lawsuits outside of bankruptcy through appeals that could correct the "flawed outcome" in some of the trials that have gone forward to date.

3M has lost 10 of the 16 earplug cases that have gone to trial so far, with about $265 million being awarded in total to 13 plaintiffs.

The case is Aearo Technologies LLC, U.S. Bankruptcy Court for the Southern District of Indiana, No. 22-02890

For Aearo: Chad Husnick of Kirkland & Ellis.

For the committee of Combined Arms Earplug plaintiffs: Melanie Cyganowski of Otterbourg PC; Bryan Aylstock of Aylstock, Witkin, Kreis & Overholtz; Christopher Seeger of Seeger Weiss; David Molton of Brown Rudnick; Michael Tuchin of KTBS Law; Kevin Maclay of Caplin & Drysdale.

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(Reporting by Dietrich Knauth; editing by Edward Tobin)