3M Earplug Lawsuit: A Comprehensive Overview

3M paid out $500 million, bringing the total funding so far to $1.6 billion. Of this amount, approximately $700 million has been distributed to victims.

Earlier in the month, $815,889,097 out of the $6 billion settlement has been paid, which is approximately 14% of the total amount.

The number of active cases decreased from 247,640 in June 2024 to 237,907 in early July 2024, representing a reduction of 9,733 cases, primarily due to dismissals for failure to cooperate.

Prior to all this, 3M has reportedly been in dispute with insurance companies to secure greater contributions for the earplug settlement. Recently, it obtained $120 million from several insurers to contribute to a $6 billion global personal injury settlement with eligible claimants who used the company’s combat earplugs.

Additionally, 3M seeks to recover over $370 million in legal defense costs from five other insurers in a Delaware state court.

As of this time, the number of pending cases in the 3M MDL remained unchanged since May. The MDL still has 247,640 pending cases, the same number as at the beginning of the month.

As the settlement procedure progresses, the 3M earplugs MDL continues to shrink. In the past month alone, 23,478 cases were resolved, reducing the total number of pending cases to 247,640. This represents the most substantial monthly decline since the litigation began.

The Settlement Program’s “Ledgering Process” is now in place for processing 3M earplug lawsuits, involving 266 law firms. BrownGreen is handling the accounting for these cases. However, 73 law firms, many with the largest client volumes, are represented by “non-ledgering” firms.

Case Management Order No. 88 was issued by the MDL judge concerning the 3M settlement. This order introduces a “Bulk Submission” method managed by the Settlement Data Administrator, BrownGreer, which enables Primary Counsel to submit data and documents for multiple claimants at once. This method is applicable for submissions related to the Extraordinary Injury Fund (EIF) Award Applications and the Deferred Payment Program (DPP) Supplementations.

The lead plaintiffs’ lawyers received detailed instructions for this bulk submission process on Monday. To avoid logistical complications, the court has set specific earlier deadlines for these bulk submissions compared to individual submissions. These deadlines are set for April 22, 2024, for MSA III Wave Claimants, and July 23, 2024, for MSA I Claimants, applicable to both EIF applications and DPP supplementations.

Furthermore, the order emphasizes the critical need to follow the established naming conventions for EIF and DPP documents to ensure accurate matching with eligible claimants. Non-compliance with these guidelines may result in sanctions against the Primary Counsel involved in the Bulk Submission process.

3M stated in a press release that “as of the final registration date for the Combat Arms Earplug settlement agreement, more than 99% of claimants are participating in the settlement.”

“Under the terms of the settlement agreement, 3M will pay a total amount of up to $6.0 billion, between 2023 to 2029, to resolve the litigation, provided all participation thresholds are met. This represents a total pre-tax present value of $5.3 billion, for which the company has previously recorded reserves.”

The same press release stated that “Aearo and 3M are actively engaged in insurance recovery activities to offset a portion of the settlement payments. Formal recovery processes are underway through a lawsuit filed in Delaware, as well as arbitration proceedings.”

After last month’s landmark announcement that 3M would allocate $6 billion to eligible claimants, Judge Rodgers has decided to extend the deadlines for the plaintiffs mentioned in CMO#57 by 30 days starting from February 20, 2024.

This extension provides an opportunity to rectify any mistakes made in earlier opt-out decisions.

A law firm has filed a motion to extend a claim registration deadline due to slow mail at a Mississippi prison, a decision pending with Judge Rodgers in a complex settlement case

Meanwhile, significant developments include BrownGreer PLC taking over as Settlement Data Administrator and 3M contributing $250 million to a fund for quicker veteran payments.

Judge Rodgers has opted not to revisit sanctions against two Dechert LLP attorneys, initially imposed for alleged misconduct during a trial, after the 11th Circuit overturned the sanctions on technical grounds.

Concurrently, concerns over 3M’s potential bankruptcy affecting a $1 billion stock transfer as part of a settlement were alleviated during a fairness hearing, with assurances of the stock’s reliable market value and immediate sale provisions.

BrownGreer PLC has replaced ARCHER Systems, LLC as a co-administrator of the related Qualified Settlement Funds, with CPA Randall L. Sansom continuing in his role. Additionally, 42,647 new cases were added to the MDL in the last 30 days, an update reflecting ongoing accounting rather than new participants in a previously closed settlement agreement.

Judge Rogers has given a final chance to eight plaintiffs to provide accurate contact details by November 3, 2023, to avoid case dismissal for non-compliance. A second group of 39 claimants has had their cases dismissed already. The judge has also ordered the closure of these claimants’ Plaintiff Identification Numbers in the MDL-Centrality system.

Bankruptcy judge Rodgers has implemented measures to combat unfair lending practices in the 3M earplug settlement agreement, including requiring disclosure of third-party funding agreements from claimants and their lawyers.

She has also instructed the Court-appointed Settlement Administrator to hold all settlement funds for plaintiffs who have taken out loans, although the administrator won’t negotiate loan repayment terms.

3M commits to a $6 billion settlement to compensate U.S. military veterans and service members who experienced loss of hearing due to the company’s defective earplugs.

The Payment Schedule attached to the settlement agreement shows the breakdown of when 3M will be funding the settlement.

A federal court judge rejects 3M’s attempt to file for Chapter 11 bankruptcy concerning the military earplug lawsuits

Despite not reaching a settlement agreement during the second day of mediation, both parties report making progress in their negotiations. Judge Rodgers schedules four bellwether trials and appoints retired judges and a Special Master to mediate the ongoing claims.

Bloomberg reveals that 3M has already spent over $450 million in defending itself in the earplug lawsuits.

The judge overseeing the Multidistrict Litigation (MDL) imposes sanctions on 3M, making it difficult for the company to evade the earplug claims.

An attempt by 3M to pause the trial proceedings through bankruptcy court is denied by the federal judge.

A jury awards a veteran $8.2 million, supporting his claim of hearing loss and tinnitus due to the defective earplugs.

In the first bellwether trial, three veterans received a combined award of $7.1 million for their hearing-related injuries.