Manufacturing giant 3M has reached a $6 billion settlement over claims by US military veterans that its earplugs were faulty and failed to protect their hearing.
The company on Tuesday said it hoped the agreement would draw a line under the long-running legal saga, in which it was hit by thousands of lawsuits by veterans complaining of hearing loss.
Under the mediated agreement, 3M will “contribute a total amount of $6 billion between 2023 and 2029, which is structured under the agreement to include $5 billion in cash and $1 billion in 3M common stock”, it said in a statement.
In 2008, 3M acquired Aearo Technologies, which sold the earplugs to the American military between 2003 and 2015.
In its statement, 3M did not admit liability for the products, which it said were “safe and effective when used properly”.
It added it was prepared to “continue to defend itself in the litigation if certain agreed terms of the settlement agreement are not fulfilled”.
Analysts had been expecting a substantially larger settlement than the figure the company unveiled.
The financial markets have reacted positively, with 3M shares ending Monday up more than 5 per cent.
The stock notched further gains on Wall Street on Tuesday following news of the settlement.
3M has been looking to make progress on a series of lawsuits brought against it in recent years, including thousands relating long-lasting chemicals known as PFAS – short for per and polyfluoroalkyl substances.
Also known as “forever chemicals”, there are accusations they may have contaminated US drinking water.
PFAS have been detected all over the globe in water, air, fish and soil, according to the US Environmental Protection Agency, which says scientific studies have shown exposure to them could be linked to harmful health effects in humans and animals.
In June, 3M agreed to pay more than $10 billion to settle lawsuits over contamination of many US public water systems related to PFAS.
“This is an important step forward for 3M,” chief executive Mike Roman.
He said the company would “exit all PFAS manufacturing by the end of 2025”.
In the settlement, the company said this payment would be made over a period of 13 years.
As in the case announced on Tuesday, 3M did not admit liability and said it was “prepared to continue to defend itself in the litigation”.
If you go
- The nearest international airport to the start of the Chuysky Trakt is in Novosibirsk. Emirates (www.emirates.com) offer codeshare flights with S7 Airlines (www.s7.ru) via Moscow for US$5,300 (Dh19,467) return including taxes. Cheaper flights are available on Flydubai and Air Astana or Aeroflot combination, flying via Astana in Kazakhstan or Moscow. Economy class tickets are available for US$650 (Dh2,400).
- The Double Tree by Hilton in Novosibirsk ( 7 383 2230100,) has double rooms from US$60 (Dh220). You can rent cabins at camp grounds or rooms in guesthouses in the towns for around US$25 (Dh90).
- The transport Minibuses run along the Chuysky Trakt but if you want to stop for sightseeing, hire a taxi from Gorno-Altaisk for about US$100 (Dh360) a day. Take a Russian phrasebook or download a translation app. Tour companies such as Altair-Tour ( 7 383 2125115 ) offer hiking and adventure packages.
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
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Multitasking pays off for money goals
Tackling money goals one at a time cost financial literacy expert Barbara O'Neill at least $1 million.
That's how much Ms O'Neill, a distinguished professor at Rutgers University in the US, figures she lost by starting saving for retirement only after she had created an emergency fund, bought a car with cash and purchased a home.
"I tell students that eventually, 30 years later, I hit the million-dollar mark, but I could've had $2 million," Ms O'Neill says.
Too often, financial experts say, people want to attack their money goals one at a time: "As soon as I pay off my credit card debt, then I'll start saving for a home," or, "As soon as I pay off my student loan debt, then I'll start saving for retirement"."
People do not realise how costly the words "as soon as" can be. Paying off debt is a worthy goal, but it should not come at the expense of other goals, particularly saving for retirement. The sooner money is contributed, the longer it can benefit from compounded returns. Compounded returns are when your investment gains earn their own gains, which can dramatically increase your balances over time.
"By putting off saving for the future, you are really inhibiting yourself from benefiting from that wonderful magic," says Kimberly Zimmerman Rand , an accredited financial counsellor and principal at Dragonfly Financial Solutions in Boston. "If you can start saving today ... you are going to have a lot more five years from now than if you decide to pay off debt for three years and start saving in year four."
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