Industrial and office products manufacturer 3M agreed to a massive settlement Thursday for contaminating drinking water with "forever chemicals" in cities across the U.S. The Dow Jones stock pared gains after an early Friday surge following the announcement.
The Minnesota-based diversified manufacturer faces thousands of lawsuits from a host of U.S. municipalities and public water suppliers alleging their drinking water was contaminated with perfluoroalkyl and polyfluoroalkyl substances (PFAS). The current cases involve PFAS from firefighting foam seeping into soil and groundwater in communities across the country over a period of decades. 3M says it began manufacturing PFAS in the 1960s.
Research shows PFAS do not break down easily in the environment or human body. The chemicals have been linked to various health problems including cancer. The U.S. Environmental Protection Agency proposed national drinking water standards for PFAS earlier this year.
3M Settlement
Per the settlement, 3M will pay $10.3 billion over the next 13 years to fund testing and treatment for eligible public water suppliers that currently detect PFAS or do so in the future. The Wall Street Journal reported 3M agreed to pay up to $12.5 billion. 3M did not admit liability as part of the settlement.
The company proposed the settlement after its federal court trial earlier this month was delayed. 3M said it will defend itself from litigation if the agreement isn't approved by the court.
In December, 3M announced it would stop manufacturing PFAS and end their use in its products by the end of 2025.
3M Stock
3M stock climbed 0.4% Friday after jumping more than 2% during intraday trading. MMM shares have fallen 52% from a May 2021 high. 3M stock tumbled about 16% so far this year — the worst performer among the 30 stocks on the Dow Jones Industrial Average.
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