Wolverine reaches settlement with 3M

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Wolverine Worldwide's global headquarters. Photo via fb.com

Wolverine Worldwide reached a settlement with the maker of a formula that contained PFAS chemicals that was used to waterproof the footwear maker’s products beginning in the 1950s and ’60s.

The Rockford-based manufacturer of shoes and apparel said Thursday that it reached a settlement of its lawsuit filed against 3M Company in December 2018.

The suit accused 3M of allegedly “concealing information” about the toxic nature of the Scotchgard chemical — which at that time contained high levels of per- and polyfluoroalkyl substances (PFAS) — with the goal of getting 3M to participate in remediation efforts, according to Wolverine in mid-December 2018.

Under the terms of the settlement, 3M is making a lump sum financial contribution of $55 million toward Wolverine’s efforts to address PFAS remediation under the consent decree recently signed by U.S. District Judge Neff to formalize a separate settlement resolving ongoing environmental litigation between the company, the state of Michigan, and Plainfield and Algoma townships.

As part of the settlement with the state and townships, Wolverine will be required to spend $69.5 million over a multiyear period toward the extension of Plainfield Township’s municipal water system to more than 1,000 properties in Algoma and Plainfield townships, as well as to take other remediation and testing actions about which the Business Journal previously reported.

“We have been committed from the very beginning to being part of comprehensive water quality solutions for the community Wolverine has called home for nearly 140 years,” said Blake Krueger, chair, president and CEO of Wolverine Worldwide. “We are pleased … that 3M is contributing toward our efforts.”

Financial impact of settlements

Based on the final consent decree and 3M settlement, the company reported net costs of $58 million in the fourth quarter of fiscal 2019, comprised of $113 million for incremental environmental investigation and remediation costs — including the $69.5 million referenced above for municipal water — partially offset by the $55 million recovery from 3M that will be paid in a lump sum in fiscal 2020.

The environmental costs discussed are estimates, and actual amounts could differ significantly in the future as circumstances evolve, according to Wolverine.

Continuing litigation

Wolverine continues to “vigorously defend itself” against litigation filed by some area residents, the company said.

According to Wolverine, those plaintiffs and their attorneys “played no role in developing the municipal water solution or other remediation actions approved in the consent decree, but they will benefit from what Judge Neff called ‘expedient and expansive relief for affected homeowners and the community.’”

As a result, Wolverine said it believes its actions “will have a significant and beneficial impact on the resolution of these lawsuits.”

Wolverine also continues to “vigorously pursue recoveries in court from its insurers, who played no role in the consent decree,” and whom the company said, “have yet to honor the policies issued to Wolverine.”

More details

Additional information on the comprehensive plan outlined in the consent decree is available at Wolverine’s blog, WeAreWolverine.com.

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