Already established as the biggest mass tort in United States history, the 3M multidistrict litigation has seen a lot of ups and downs in the past year. Below are the chronological highlights of this ever-evolving, ever-growing case.
3M Appeals its First Trial Loss
Nearly a year ago, the first bellwether trial resulted in a $7.1 million verdict in favor of plaintiffs and veterans, Luke Estes, Stephen Hacker, and Lewis Keefer. Then earlier this year, 3M filed an appeal with the U.S Court of Appeals for the 11th Circuit seeking to overturn the verdict. One of 3M’s main arguments in its appeal is that the plaintiffs’ product defect and failure to warn claims were pre-empted under the government contractor defense. The defense is a legal doctrine that shields government suppliers from liability if:
- The government approved reasonably precise specifications for the equipment
- The equipment conformed to those specifications
- The supplier warned the government about known dangers or risks
Judge Denies Appeal
The presiding MDL judge, the Honorable M. Casey Rodgers, previously ruled upon the issue. The judge found that the defense was not applicable to 3M. PerBoyle v. United Technologies Corp., 487 U.S. 500 (1988), the case which sets forth the requirements to establish the government contractor defense, the defense does not apply unless the litigation implicates interests that are “uniquely federal.” Under Boyle, a procurement contract of equipment by the U.S. military would fall under this category.
However, Judge Rodgers found that such a defense does not exist in the absence of a government contract. Judge Rodgers held that 3M never had any contractual relationship with the government in regard to the earplug’s design. Other suppliers who successfully raised such a defense did have a contractual relationship. Furthermore, even if 3M established the “uniquely federal” requirement, the judge found that the company would fail the 3-part test. The judge held that there was no evidence the government approved “reasonably precise specifications” for 3M’s earplugs.
In its appeal, 3M argued that the purchase order placed for the earplugs was effectively a procurement contract. Nonetheless, 3M challenged whether a procurement contract with design specifications is necessary to invoke the defense.
A $110 Million Verdict for Two Veterans
The 3M litigation started the new year with its largest verdict to date. Back in January, a federal jury in Florida awarded two U.S. Army veterans $110 million. The jury found that 3M’s Combat Arms Earplugs Version 2 were defective and caused the plaintiffs, Ronald Sloan and William Wayman, to suffer hearing damage. The jury then awarded each veteran $15 million in compensatory damages and $40 million in punitive damages. The previously largest 3M verdict award was $22.5 million. The trial was the 11th at the time to reach a verdict. Six of those trials concluded in favor of the plaintiffs for a total award of $160 million. Five of those trials ended in favor of 3M.
The Second-Largest Verdict Thus Far
Less than two months after the largest verdict in the 3M litigation, another federal jury in Florida found in favor of a U.S. service member. The jury awarded him $50 million in damages after he sustained permanent hearing loss from faulty 3M earplugs. This verdict marked the 12th bellwether trial and the second largest verdict to date. The plaintiff, Luke Vilsmeyer, used 3M’s earplugs for more than a decade during training.
3M Seeks Expedited Payment of Filing Fees
Less than two weeks after the Vilsmeyer verdict, in early April, 3M filed a motion with the court requesting a 30-day deadline for all plaintiffs on the administrative docket to each pay the required $402 filing fee in order to proceed. Unlike other cases filed in federal courts, no filing fees or other costs were required upon filing a complaint with the MDL proceeding. As 3M argues, with “all meaningful and customary barriers to filing a lawsuit removed, this MDL quickly became the largest in history.” 3M asserts that without filing fees, plaintiffs and attorneys are encouraged to file claims without vetting them.
The court has begun to transition cases from the administrative docket and commence the process of filing fee payments. However, 3M argues that with 180,000 plaintiffs yet to be provided payment deadlines, and more than 9,000 plaintiffs given several months to pay, it will take almost a year to transfer the cases and obtain fees. The administrative docket now includes 265,000 claims, with approximately 25,000 pending cases being ordered to the active docket, during which time fees are paid.
Judge Rodgers denied 3M’s motion, finding that the argument that requiring immediate payment “would winnow the inventory to a trivial size” was a “fallacy” and “not borne out by the numbers.” The judge cites the over 86% of plaintiffs in the first transition that moved to the active docket, demonstrating filing fees are not an “MDL-killer.” The judge also cites the administrative difficulties surrounding the transfer of so many cases at a time.
3M Evens Out its Record
Although its motion for filing fees didn’t deter claims, the month of April was not an entire loss for 3M. A Pensacola jury rejected the claims that 3M was liable for the hearing loss and tinnitus suffered by Denise Kelley, a U.S. Army veteran. The jury found that 3M did not cause Kelley’s injuries. The jury also found that 3M’s earplugs did not contain a design defect or errors in its instructions. Kelley’s case marks the 6th verdict in favor of 3M. As Carolyn LaViolette, 3M’s spokesperson, lauded: “We are pleased another jury has sided with 3M…We have now won nearly half of the bellwether trials, in addition to the eight cases plaintiffs’ lawyers have dismissed before they reached trial.”
April Ends With a Win for Plaintiffs
Fresh off its victory in the Kelley case, 3M faced another trial loss at the end of April. A jury awarded $2.2 million to U.S. Army veteran, Jonathan Vaughn. The plaintiff suffered from hearing loss and tinnitus and now wears a hearing aid. The plaintiff argued that the 3M earplugs he used were defective. The jury agreed, finding that 3M acted negligently in its design and misrepresented the quality of the earplugs. The earplugs were unreasonably dangerous, according to the verdict form. The Kelley verdict is the latest verdict rendered in favor of the plaintiffs—with a current running tally of 9 out of 15 trial wins.
May Begins With Dismissal of 20,000 Claims
On May 9, 2022, Judge Rodgers dismissed the claims of over 20,000 veterans. They had failed to provide certain necessary documents to proceed with their cases. The missing documents are the official service records of the veterans, known as a DD214. As the cases move from the administrative docket to the court’s standard docket, they must provide these documents and meet certain criteria. Per the court, the veterans can get their cases reinstated if they produce the required documents within a specific timeframe.
3M released a statement expressing support for the court’s decision, noting that “these orders are an important step in the right direction. Requiring expedient vetting could help provide greater certainty into the actual number of cases in the [multidistrict litigation].” According to a lead plaintiff’s attorney, more than 85% of plaintiffs are transitioning their cases to an active docket.
$2.2 Million Win for Veteran
Days after the dismissal of 20,000 claims, the plaintiff side scored another trial win. The jury found 3M liable for the hearing loss suffered by Iraq war veteran, Jonathan Vaughn, after his use of defective ear plugs. They awarded Vaughn, who has used a hearing aid since 2012, $2.2 million as compensation for inconvenience, past and future pain and suffering, impairment of quality of life, and emotional stress. The jury found that 3M’s earplugs were unreasonably dangerous and that the company acted negligently in misrepresenting the quality of its product.
Plaintiff Awarded $77.5 Million in Final Bellwether Trial
On May 16, 2022, the final bellwether trial ended on a massively high note for army veteran, James Beal. A federal jury in Pensacola, Florida found 3M liable for injuries Beal had suffered from using the defective earplugs. The jury awarded him $77.5 million in damages—$5,000,000 in compensatory damages and $72,500,000 in punitive damages. The jury found in favor of Beal on all claims, including fraudulent misrepresentation and fraudulent concealment.
The Beal trial is 3M’s 10th trial loss out of the 16 bellwether trials. The award is the largest verdict amount in all of the bellwether trials.
3M Commits $1 Billion to Trust as Aearo Technologies Files for Bankruptcy
3M announced in July that it was committing $1 billion to a trust dedicated to resolving the pending lawsuits. As part of the plan, Aearo Technologies, the company that manufactured the earplugs, will be filing for bankruptcy. 3M had purchased the company in 2008. 3M has also committed $240 million to help fund Aearo’s bankruptcy proceeding.
In a joint statement released by the plaintiffs’ firms, they intend to fight the bankruptcy petition. “3M’s bankruptcy maneuver is further proof that they value their profits and stock price more than the well-being of veterans who fought and served our country,” the statement reads. “Considering that juries have ruled in favor of 13 out of 19 service members whose cases went to trial and awarded nearly $300 million in damages, the trust to resolve earplug litigation claims is woefully underfunded and not the ‘efficient and equitable resolution’ that 3M is desperately pretending it is.”
Judge Rodgers will be holding a hearing concerning 3M’s acquisition of Aearo. Judge Rodgers will be determining whether 3M should be prohibited from arguing it is not a proper defendant. 3M will be arguing that the automatic stay triggered by Aearo’s bankruptcy should be extended to 3M as well. In light of the bankruptcy proceeding, Judge Rodgers issued an order pausing the transfer of cases to the active docket. While this has slowed those plaintiffs who wish to proceed to the active docket immediately, it also gives plaintiffs more time to pay filing fees and gather necessary documents.
The allegations surrounding 3M’s earplugs stem from the alleged defects in the dual-purpose design of its Combat Arms Earplugs Version 2. One side of the plug provided protection from noise. The other side allowed the user to hear some noise. According to the plaintiffs, the earplugs could not insert properly into the ear. As a result, this rendered its protection inadequate and resulted in hearing loss. The proliferation of the multidistrict litigation is, in part, due to 3M’s widespread prevalence on the market. It was a standard issue for U.S. service members for years.
All scheduled bellwether trials for this year have concluded, with 3M prevailing on six cases and losing 10. The plaintiffs have won almost $300 million in judgments against the company, with the latest verdict being the largest thus far. The announcement of 3M’s $1 billion trust might pave the way for at least some of the remaining 250,000 lawsuits to reach a settlement agreement. However, 3M has not yet paid damages on the cases it has already lost. Instead, the company chose to appeal each of the verdicts. With those appeals still pending, as well as 3M seeking protection from the bankruptcy court, it is likely that 3M may still prefer to test its luck in the courts before offering any acceptable settlements to the remaining plaintiffs.