Addressing ongoing PFAS litigation is one of chemical giant 3M’s top strategic priorities, CEO and Chairman Mike Roman said on an earnings call on Tuesday.
“Over the last several years, we’ve been talking about taking a proactive approach to managing our litigation and that includes the whole PFAS docket,” Roman told analysts on the call. “And it’s been part of our strategy and we talk about it kind of in short form that we’re going to proactively manage it, defend ourselves in court and work to resolve through mediation as appropriate.”
Last month, 3M took a major step towards settling the growing legal claims against it and its use of “forever chemicals.” The company reached a $10.3 billion settlement over allegations it contaminated public water supplies across the U.S. with PFAS. The funds will be paid over 13 years and could later grow to as much as $12.5 billion, according to a securities filing.
As a result of the settlement, 3M posted a pre-tax charge of $10.3 billion in Q2. The CEO highlighted that the litigation is independent of the company’s share price, but that the issue has created uncertainty for the chemical manufacturer’s finances.
“We don’t like the overhang on the stock and we want to manage it,” Roman said. “As we move forward, we’ve got to do what’s in the best interest of the company for the long term. And so that gets back to we’re going to defend ourselves in court and we’re going to work to resolve as appropriate.”
Executives on the call touted the changes 3M has made to its PFAS manufacturing over the last 20 years. In 2000, the company announced it was phasing out the use of perfluorooctanyl sulfonate (PFOS) chemicals, a type of PFAS chemical used at the time to produce products such as its Scotchgard brand and aqueous firefighting foam.
Twenty-three years later, the Minnesota-based company announced it was phasing out the use of all PFAS from its manufacturing and products by the end of 2025.
Despite such changes, 3M has faced mounting litigation from states over claims the company knowingly contaminated U.S. environments and water systems for decades. Many of the lawsuits seek remediation, testing and treatment of affected natural resources, such as public water systems.
PFAS litigation isn’t the only issue 3M is dealing with. The company is also participating in the mediation process involving lawsuits against its subsidiary Aearo Technologies, regarding claims the company knowingly sold defective earplugs to the U.S. military.
To date, Aearo Technologies has received 336,995 legal complaints regarding the earplugs, according to the U.S. Judicial Panel on Multidistrict Litigation. As of July 17, 257,449 cases were still pending.
