3M Pledges $1 Billion Trust to Resolve Earplug Hearing Loss Claims Litigation; Subsidiary Company Initiates Chapter 11 Bankruptcy Filing

3M Pledges $1 Billion Trust to Resolve Earplug Hearing Loss Claims Litigation; Subsidiary Company Initiates Chapter 11 Bankruptcy Filing
July 27, 2022

ST. PAUL, MINNESOTA — 3M (NYSE: MMM) has announced it is taking action to resolve litigation related to Combat Arms Earplugs Version 2 (“Combat Arms Earplugs”). Aearo Technologies and related entities, all of which are wholly-owned 3M subsidiaries, have voluntarily initiated chapter 11 proceedings seeking court supervision to help establish a trust – funded by 3M – to “efficiently and equitably resolve all claims determined to be entitled to compensation.”

3M and Aearo Technologies believe the Combat Arms Earplugs were effective and safe when used properly, but nevertheless face increasing litigation, including approximately 115,000 filed claims and an additional 120,000 claims on an administrative docket as of June 30, 2022.

The well-established chapter 11 process is intended to achieve an efficient and equitable resolution, reduce uncertainty, and increase clarity for all stakeholders, while reducing the cost and time that could otherwise be required to litigate thousands of cases. 3M and its other businesses have not filed for chapter 11 and will continue to operate as usual. Aearo Technologies will also continue to operate in the ordinary course.

“We have great respect for the brave men and women who protect us, and remain committed to the military as an active partner and valued customer going forward. We determined that taking this decisive action now will allow 3M and Aearo Technologies to address these claims in a way that is more efficient and equitable than the current litigation.”

–3M Chairman and CEO, Mike Roman

The company believes that, absent the actions taken today, the claims could take years, if not decades, to litigate on a case-by-case basis. With this change in strategy, this process is intended to resolve claims related to Combat Arms Earplugs in a manner that is more efficient and equitable to all parties.


Announcement Details

  • Aearo Technologies was acquired by 3M in 2008 and has since operated as a wholly-owned subsidiary of 3M.
  • 3M has entered into a funding agreement with Aearo Technologies to establish a trust to resolve all claims determined to be entitled to compensation, and to support Aearo Technologies as it continues to operate during the chapter 11 process.
  • The claims largely relate to the previous generation Combat Arms Earplugs manufactured by Aearo Technologies, as well as discontinued Aearo Technologies mask and respirator products utilized to reduce workplace exposure to asbestos, silica, coal mine dust or occupational dusts.
  • Aearo Technologies has indemnified 3M for obligations related to the claims.
  • 3M has committed $1 billion to fund the trust, based on the analysis of an experienced estimator of claims in chapter 11.
  • 3M has also committed an additional $240 million to fund projected related case expenses.
  • 3M will provide additional funding if required under the terms of the agreement.

As a result, 3M recorded a total pre-tax charge of $1.2 billion, or $1.66 per share, and reflected it as an adjustment in arriving at its results, adjusted for special items.

Additional Information

In conjunction with the chapter 11 process, Aearo Technologies will file customary first day motions with the bankruptcy court seeking authority to continue operating in the normal course of business, without interruption or disruption to its customers, vendors, and employees.

The Aearo Technologies chapter 11 cases were filed in the U.S. Bankruptcy Court for the Southern District of Indiana. Additional information is available on resolvingearpluglitigation.com and www.3mearplugsfacts.com. Court filings and information about the chapter 11 cases are available on a separate website administered by Aearo Technologies’ claims agent, Kroll; information is also available by calling (855) 639-3375 (Toll-Free US/Canada) or +1 (347) 897-3818 (International); or by emailing [email protected].

Source: 3M

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