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3M Earplug Judge Sympathetic to Veterans’ Call to Proceed (1)

Aug. 11, 2022, 5:27 PMUpdated: Aug. 11, 2022, 7:01 PM

3M Co.'s may not be able to halt hearing-loss litigation over combat earplugs despite bankruptcy proceedings involving the subsidiary that produced them, the federal judge overseeing the veterans’ suits said at a hearing Thursday.

Its recent indemnification agreement with Aearo Technologies LLC “created” the financial distress that allowed the earplug maker to seek bankruptcy protection, Judge M. Casey Rodgers said.

But Rodgers asked for a key document cited by 3M, described as an earlier indemnification agreement between the companies, that could affect her views. She’s also awaiting information on which company carried the liability on its balance sheet.

Rodgers appeared to agree with Ashley Keller, an attorney for veteran Richard Valle, that 3M was using the bankruptcy court to circumvent some of Rodgers’ orders in the sweeping earplug litigation at the US District Court for the Northern District of Florida.

“I’m not sure I’m comfortable leaving it to another court,” Rodgers said.

Reversals are the prerogative of the US Court of Appeals for the Eleventh Circuit, she said. Valle is seeking to prevent 3M from pausing the personal injury suits or supporting Aearo’s efforts to do so.

A separate motion by plaintiff Guy Cupit requested a ruling that 3M wouldn’t share liability with Aearo, allowing veterans to proceed only against 3M. Cupit said 3M waived a defense that it lacked full liability as Aearo’s successor, or should be prevented from making that argument because of how it acted.

At the hearing, Cupit’s attorney, Adam Wolfson, said the companies have taken the position that any difference in corporate form is “illusory” in trial after trial.

But Charles Beall Jr., for 3M, said the company had never asked for a ruling on successor liability, nor had the plaintiffs.

Rodgers said she had told juries the companies were “one and the same,” and no one corrected her.

Keller is with Keller Postman LLC in Chicago. Wolfson is with Quinn Emanual Urquhart & Sullivan LLP in Los Angeles.

Jessica Lauria of White & Case LLP in New York argued in opposition to Valle’s motion. Beall is with Moore, Hill, & Westmoreland PA.

The case is In re 3M Combat Arms Earplug Prods. Liab. Litig., N.D. Fla., No. 3:19-md-02885, hearing 8/11/22.

(Updates with additional information throughout.)

To contact the reporter on this story: Martina Barash in Washington at mbarash@bloomberglaw.com

To contact the editor responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com