U.S. giant 3M has filed for bankruptcy for its subsidiary, Aearo Technologies, which manufactures earplugs, hoping to settle in this way lawsuits filed against it by veterans in the United States.
The former soldiers claim to have suffered from hearing loss while wearing earplugs sold by 3M to the US military.
The conglomerate, known to the general public for its Scotch or Post-It brands, has already spent nearly $350 million defending itself against nearly 230,000 lawsuits brought against its earplugs, according to court documents. It sees bankruptcy as the quickest and fairest way to resolve these disputes.
When a company goes bankrupt, proceedings are suspended, and complaints are then dealt with by a bankruptcy court; 3M said it had transferred $1 billion to a trust – a legal structure under U.S. law allowing assets to be pooled – to compensate the plaintiffs. It also provided $240 million to fund the bankruptcy.
The complaints relate to noise-cancelling earplugs that the Aearo subsidiary massively supplied to the U.S. military between the early 2000s and 2015. So far, only a handful of these complaints, brought mainly by veterans, have been adjudicated. In one case, the court ordered 3M to pay $77.5 million.
On Tuesday, the group also announced its intention to separate from its health-related activities to make them a separately listed company.
