Approximately 300,000 lawsuits alleging faulty combat earplugs supplied by 3M to the military caused significant injuries, including hearing loss, have been resolved with a $6 billion settlement.

The company said the agreement “does not admit liability” and the payout will come over several years and encompass $5 billion in cash and $1 billion in stock.

When used properly, the products at issue in this litigation are safe and effective. According to 3M, if certain agreed terms of the settlement agreement are not met, the company will continue to defend itself.

The earplugs were made by Aearo Technologies, a company 3M acquired in 2008. As a way to fund its liabilities and limit exposure, Aearo tried filing for bankruptcy last year. According to the judge, allowing an otherwise financially healthy debtor with no impending solvency issues to remain in bankruptcy “exceeds the court’s limited authority.”

For the third quarter of 2023, 3M expects the agreement to result in a pre-tax charge of approximately $4.2 billion. Investors expected the settlement to be significantly higher on Monday, which led to a 5% increase in shares.

This is 3M’s second significant lawsuit settlement this summer. Earlier this summer, the manufacturer announced it would pay up to $10.3 billion over 13 years to fund public water suppliers that have detected its toxic “forever chemicals” in their water supplies.

Many household items, including makeup and carpeting, contain polyfluoroalkyl and perfluoroalkyl substances (PFAS), known as “forever chemicals.” These compounds produce coatings that repel water, grease, and oil.

As a result of the settlement, 3M has settled thousands of lawsuits alleging that the company knew PFAS caused cancer, developmental defects and other health problems, and that the chemicals contaminated US water supplies.

3M announced last year that it would stop producing the controversial chemicals by the end of 2025.