Veterans seek to block 3M bankruptcy bet

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The 3M logo is seen at the 3M Tilloy factory in Tilloy-Lez-Cambrai, France, August 18, 2019. REUTERS/Pascal Rossignol

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(Reuters) – Veterans who say 3M Co’s military earplugs caused hearing damage are asking the judge overseeing their record-breaking mass tort litigation to stop the company from dumping liability on a subsidiary in bankruptcy.

Two motions filed this week in Pensacola, Fla., in federal court by plaintiffs in the multidistrict litigation made separate arguments about why the company couldn’t escape the nearly 300,000 lawsuits by putting its subsidiary Aearo Technologies – the original maker of the earplugs, which 3M bought in 2008 – went bankrupt.

3M said it believed bankruptcy law permitted this strategy and argued that the Indianapolis bankruptcy court could resolve earplug claims more fairly than the MDL.

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“We are prepared to move forward and believe applicable law supports our position,” 3M said in a statement.

Aearo filed for bankruptcy on July 26 and said it had committed $1 billion to resolve the earplug litigation. Of the 16 lawsuits in this litigation to date involving 19 service members, plaintiffs have won 10, with approximately $265 million in combined awards to 13 plaintiffs.

Plaintiffs said they suffered injuries, including tinnitus and hearing loss, after using Aearo’s CAEv2 earplugs in combat or training because they did not form an adequate seal.

In a movement filed Thursday, veteran Guy Cupit argued that 3M, which did not file for bankruptcy itself, can no longer argue that it is not responsible for its subsidiary’s products because it has not raised this defense after three years of litigation. He asked U.S. District Judge Casey Rodgers, who has presided over the litigation since 2019, to issue an order restraining 3M “from asserting that it bears anything other than full liability” for the injuries.

Cupit’s motion came a day after another veteran, Richard Valle, asked the judge to issue an injunction restraining 3M from taking any legal action to prevent any plaintiff from pursuing earplug claims against it in the district court.

Valle argued that Rodgers had the power to issue such an injunction under the All Writs Act, an 18th-century federal statute that gives federal courts the power to issue any order “necessary or proper using their respective jurisdictions”.

Valle said such an order was necessary to prevent 3M from unfairly asking for a “second bite of apple” in bankruptcy court simply because it doesn’t like the results it got in district court.

Rodgers gave 3M until Tuesday to respond to the motions and scheduled a hearing on them Thursday.

The MDL is In re 3M Combat Arms Earplug Products Liability Litigation, US District Court, Northern District of Florida, No. 19-md-2885.

For plaintiffs: Adam Wolfson of Quinn Emanuel Urquhart & Sullivan; Ashley Keller of Keller Postman; Bryan Aylstock, Daniel Thornburgh and Jennifer Hoekstra of Aylstock, Witkin, Kreis & Overholtz; Shelley Hutson of Clark, Love & Hutson; Chris Seeger and Caleb Seeley of Seeger Weiss; and Joseph Messa of Messa & Associates

For 3M: Kimberly Branscome of Dechert

Read more:

3M earplug bankruptcy creates ‘corrosive’ tension with other courts, lawyer says

3M to divest healthcare business, earplugs unit files for bankruptcy protection

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