3M (NYSE:MMM) could reportedly see more than $100 billion in losses due to lawsuits regarding allegedly faulty earplugs.
Bloomberg reported earlier this week that a litigation consultant hired by lawyers suing 3M suggested that the losses and bankruptcy could come from suits from veterans who blame hearing problems on the company’s earplugs.
The report stated that initial results from test cases demonstrate that the losses could add up with more than 230,000 lawsuits related to the military earplugs potentially moving forward, according to testimony from J.B. Heaton — the plaintiff’s adviser — in bankruptcy court.
Heaton also alleged that it is “more and more likely” that bankruptcy could be on the horizon “within the next several years,” according to Bloomberg. The report also said that, following the company’s disputing of his testimony, Heaton conceded that a judge may not deem the $100 billion total as “realistic.”
A 3M spokesperson told the news outlet that the company strongly disagrees with the “unsupported and clearly flawed speculation.” The spokesperson also said that 3M committed to providing $1 billion to a trust for claimants “determined to be entitled to compensation.”
3M subsidiary Aearo Technologies and related entities have voluntarily initiated Chapter 11 proceedings to seek court supervision to establish a 3M-funded trust to efficiently and equitably resolve all claims entitled to compensation.
The manufacturing conglomerate also recently announced plans to spin off its Health Care business by the end of 2023. However, 3M plans to retain all responsibility for non-Health Care-related litigation, including the legal proceedings related to the Combat Arms Earplugs.