Following an August decision by an Indiana bankruptcy court that left 3M facing nearly 300,000 hearing damage claims filed by veterans over Combat Arms Earplug version 2 (CAEv2), an appeals court granted the company and its subsidiary Aero Technologies authorization to receive a direct appeal of the order, Law360.com reported. The 7th Circuit Court of Appeals granted 3M’s petition Oct. 13 without offering an explanation.
On July 26, 3M dumped its CAEv2 legal liabilities onto its subunit, Aearo Technologies, the company that originally manufactured the controversial earplugs that were supplied to the U.S. military from 2003 until 2015. Immediately thereafter, 3M filed for Chapter 11 bankruptcy protection for its subunit with the intention of having Aearo protected from the hundreds of thousands of hearing damage claims.
However, a federal bankruptcy judge in Indianapolis, Jeffrey Graham, ruled on August 29 that veterans could still pursue their legal claims against 3M despite its subunit filing for Chapter 11 bankruptcy protection.
On Oct. 13, the same day the 7th Circuit granted 3M a review of Graham’s decision to deny 3M a stay on the litigation, the 11th Circuit Court of Appeals, based in Atlanta, granted 3M’s motion to stay the injunction during the bankruptcy appeals process.
Veterans allege that 3M is using Chapter 11 bankruptcy to escape facing more than 230,000 lawsuits. In 16 bellwether trials that concluded before 3M filed for bankruptcy for its subunit, juries awarded 13 plaintiffs $300 million in damages in 10 of those trials.
On Oct. 14, 3M provided a statement, saying the "well-established Chapter 11 process provides a more efficient, equitable and expeditious means to resolve this litigation." As part of its bankruptcy plan, 3M created a $1 billion trust to resolve the rest of the claims.