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The Bankruptcy StrategistFeaturesBankruptcyLitigation

Bankruptcy Judge Dismisses 3M Unit's Earplug Case, Concluding It Had No 'Valid Reorganization Purpose'

By Amanda Bronstad
July 01, 2023

A bankruptcy judge dismissed a 3M unit's Chapter 11 case to resolve lawsuits over combat earplugs, concluding that it had no "valid reorganization purpose."

U.S. Chief Bankruptcy Judge Jeffrey Graham, who heard dismissal arguments for three days in April in Indianapolis, found that 3M subsidiary Aearo Technologies, which is financially solvent, had no "valid reorganization purpose" to file for Chapter 11 protection last year.

"From the very beginning of these cases, Aearo made clear that the filings were not prompted by concerns over financial distress or impending insolvency but were initiated to manage the MDL process, a process that Aearo insisted was 'broken,'" he wrote in a 49-page ruling. "These cases were and are a litigation management tactic and not a rehabilitative effort."

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