The largest military settlements of the past decade have moved tens of billions of dollars to veterans, service members, and their families, covering defective combat earplugs, toxic water at bases, Agent Orange exposure, wrongful discharges, and contractor fraud. Most of the money comes from private manufacturers or from the Department of Veterans Affairs through court-ordered benefits, not from direct lawsuits against the armed forces. The sections below walk through the biggest resolutions, who qualifies, and where each program stands now.
3M Combat Arms Earplugs: $6 Billion
The single largest mass tort tied to military service resolved claims that 3M’s Combat Arms Version 2 earplugs, issued from 1999 to 2015, were defectively designed and failed to protect hearing. About 271,000 claimants joined the multidistrict litigation before 3M agreed to a $6 billion settlement fund payable between 2023 and 2029.1BrownGreer. Combat Arms Earplugs By late January 2026, more than $3.1 billion had already reached claimants, and the federal MDL had been wound down.2Miller & Zois. 3M Combat Arms Earplug Lawsuit Attorneys
Payments move through several tracks. Early Payment Program and Wave Case enrollees have largely received full payment, deferred awards built on a points system began going out after October 2025, and an Extraordinary Injury Fund covers the most severe hearing losses. The program is expected to continue through 2029.2Miller & Zois. 3M Combat Arms Earplug Lawsuit Attorneys
PFAS Water Contamination Near Military Bases
Aqueous film-forming foam, or AFFF, was used for decades at military bases to extinguish fuel fires. The foam contained per- and polyfluoroalkyl substances (PFAS), which leached into groundwater and contaminated drinking water near hundreds of installations. The Department of Defense has identified 723 locations requiring PFAS assessment, with 588 moving to remedial investigation as of September 2025.3Office of the Under Secretary of Defense for Acquisition and Sustainment. Cleanup PFAS
The resulting litigation in MDL No. 2873 has produced some of the largest environmental settlements on record. 3M agreed to pay between $10.5 billion and $12.5 billion to resolve claims from public water systems, with final court approval in spring 2024. DuPont followed with $1.185 billion, Tyco Fire Products with $750 million, and BASF with $315.5 million.4Keller Rohrback. AFFF PFAS Liability Litigation5PFAS Water Settlement. 3M Frequently Asked Questions
Those settlements cover cleanup costs for public water utilities, not individual health claims. Personal injury suits from people who developed cancer and other diseases after drinking contaminated water remain unresolved. Over 15,000 PFAS lawsuits are pending in the MDL, and bellwether trials involving kidney cancer claims near a Pennsylvania military base were scheduled to begin in late 2025.6YouHaveALawyer. PFAS Water Contamination Lawsuit
Camp Lejeune Toxic Water Claims
The Camp Lejeune Justice Act, enacted as part of the PACT Act of 2022, opened a legal pathway for people harmed by contaminated drinking water at the Marine Corps base in North Carolina between 1953 and 1987. The Department of Justice created an Elective Option program to resolve qualifying claims faster than traditional litigation. As of March 2026, 2,531 settlement offers had been approved under that program, totaling about $708 million, with individual payments ranging from $100,000 to $550,000 depending on the injury.7Department of Justice. Department of Justice Approves Historic Number of Settlements for Camp Lejeune Victims and Families
Payouts accelerated in early 2026, with the DOJ moving over $421 million in Elective Option settlements since January 20, 2025, including $175 million in a single three-week stretch.7Department of Justice. Department of Justice Approves Historic Number of Settlements for Camp Lejeune Victims and Families The Elective Option still covers only a fraction of claimants. The Navy has received roughly 409,000 non-duplicate administrative claims, and 3,715 lawsuits are pending in the Eastern District of North Carolina. The Congressional Budget Office has estimated total government exposure could reach $21 billion, and two court-appointed Settlement Masters are developing a compensation matrix that would categorize injuries by severity and exposure duration.8Miller & Zois. Camp Lejeune Lawsuit Settlement
Agent Orange and the Nehmer Consent Decree
The 1984 Agent Orange class action against Dow Chemical, Monsanto, and other manufacturers settled for $180 million, the largest settlement of its kind at the time.9Department of Veterans Affairs. Agent Orange Settlement Fund10History.com. Agent Orange Settlement The far larger financial impact came through a separate case against the federal government. In 1986, the National Veterans Legal Services Program filed Nehmer v. U.S. Veterans Administration, challenging the VA’s restrictive approach to Agent Orange disability claims. A federal court invalidated the VA’s rules in 1989, and a 1991 consent decree required the VA to readjudicate prior claims and pay retroactive benefits every time a new disease was added to the presumptive list. In 2020, a court order expanded the decree to cover “Blue Water Navy” veterans who served within 12 nautical miles of Vietnam’s coast.11VA Office of Inspector General. Nehmer Report
The National Veterans Legal Services Program reports that the Nehmer decree has delivered over $7.2 billion in VA compensation to veterans and their survivors.12National Veterans Legal Services Program. Class Actions A 2024 VA Inspector General report found the process incomplete, estimating that about 86,894 veterans who qualified under recently added presumptive conditions had not been identified for readjudication, representing an estimated $836.8 million in unpaid retroactive benefits.11VA Office of Inspector General. Nehmer Report
Discharge Upgrade and Correction Settlements
Two class actions have reshaped how veterans can clear their records.
Kennedy v. McCarthy
Filed in 2017 by the Yale Veterans Legal Services Clinic, Kennedy v. McCarthy challenged the Army Discharge Review Board’s failure to grant upgrades to veterans whose misconduct was tied to PTSD, traumatic brain injury, military sexual trauma, or other behavioral health conditions. The certified class covered roughly 50,000 Army, Army Reserve, and Army National Guard veterans discharged with “general” or “other than honorable” characterizations after October 7, 2001.13Yale Law School. Kennedy v. McCarthy
The settlement, approved on April 26, 2021, required the ADRB to automatically reconsider cases denied between April 2011 and November 2020 where mental health was raised, and to notify veterans denied between 2001 and 2011 of their right to reapply under more favorable “liberal consideration” standards. It also created a telephonic hearing program, enhanced training for board members, better explanations for denials, and information about free legal help included with every application acknowledgment.14Kennedy Settlement. Kennedy Settlement15Stars and Stripes. Army Agrees to Review Thousands of Bad Paper Discharges as Part of Lawsuit Settlement A July 2025 Government Accountability Office report found approval rates across the branches ranging from 18 to 49 percent, with boards “inconsistently” applying key guidance.16Government Accountability Office. GAO-25-107354 The Army’s 2025 grant rate for mental-health-related cases has risen above 50 percent, though processing often stretches two to three years.17Military Advocacy. Trends and Statistics in Discharge Upgrade Boards
Farrell v. Department of Defense
In January 2025, the Department of Justice settled Farrell v. Department of Defense, a class action on behalf of veterans discharged under “Don’t Ask, Don’t Tell” and predecessor policies that barred lesbian, gay, and bisexual service members. Final approval came on March 12, 2025.18Department of Justice. U.S. Government Reaches Settlement in Class Action Relating to Discharge Paperwork of Military Veterans19Secretary of the Navy. Farrell Class Action20U.S. Army. Army Review Boards Agency
Pay and Medical Retirement Rulings
Three recent cases have forced the services to pay or re-pay money owed for combat-related disability.
Soto v. United States
On June 12, 2025, the Supreme Court ruled unanimously in Soto v. United States that the Department of Defense had wrongly applied a six-year statute of limitations to retroactive Combat-Related Special Compensation payments. Justice Clarence Thomas wrote that Congress intended the CRSC statute to operate as a self-contained scheme with no limitations period, displacing the default rule under the Barring Act.21Supreme Court of the United States. Soto v. United States The ruling affects a nationwide class of more than 9,000 former service members whose CRSC applications had been granted but whose retroactive payments were capped. Eligible veterans may now recover payments dating back to January 1, 2008, the effective date of a 2008 statutory amendment, rather than only the previous six years.22National Veterans Legal Services Program. Supreme Court Unanimously Rules for 9,000 Combat Disabled Veterans The Department of the Navy is reviewing over 15,000 claims to determine which members were shortchanged.23Secretary of the Navy. Soto
Smoke v. Driscoll
In a settlement executed on March 6, 2026, the Army agreed to classify open-air burn pits in combat zones as “instrumentalities of war” for medical retirement purposes. The Smoke v. Driscoll plaintiffs argued the service had wrongfully denied their medical retirement pay a combat-related tax exemption, even though their disabilities were caused by burn pit exposure presumed service-connected under the PACT Act.24National Veterans Legal Services Program. NVLSP and Sidley Settle Class Action Lawsuit With U.S. Army Designating Burn Pits as Instrumentalities of War The practical effect is that affected veterans’ disability retirement pay becomes tax-free. The Army agreed to review the records of all veterans medically retired for PACT Act conditions on or after August 10, 2022, and to make reasonable efforts to complete those reviews within six months.25National Veterans Legal Services Program. Smoke et al. v. Driscoll FAQ
Torres v. Del Toro
In September 2022, a federal court ruled in Torres v. Del Toro that a Navy policy restricting Physical Evaluation Boards to only “properly referred” medical conditions was unlawful. The policy had been in place from September 2016 to June 2018, and about 3,770 sailors and Marines medically discharged during that window with combined disability ratings of 20 percent or less became entitled to new evaluations.26Military.com. More Than 3,700 Medically Discharged Sailors and Marines Eligible for Reevaluation for Retirement27National Veterans Legal Services Program. Torres v. Del Toro FAQs28Department of the Navy. Torres Notice
Appeal Rights for VA Family Caregivers
The VA’s Program of Comprehensive Assistance for Family Caregivers, established in 2010, provides benefits to veterans with serious injuries who rely on at-home caregivers. For years, decisions to deny, reduce, or terminate those benefits could not be appealed outside the VA’s internal process. In April 2021, the U.S. Court of Appeals for Veterans Claims ruled in Beaudette v. McDonough that the VA had to allow these decisions to be appealed to the Board of Veterans’ Appeals.12National Veterans Legal Services Program. Class Actions The ruling, later unanimously upheld by the Federal Circuit, affected more than 400,000 veterans and their caregivers. Starting November 17, 2021, the VA began sending notices informing class members of their appeal rights. By February 2024, nearly 14,000 veterans and caregivers had filed an appeal, submitted a supplemental claim, or requested a higher-level review.29Public Counsel. Victory for Veterans: Federal Circuit Upholds Right to Appeal Family Caregiver Program Decisions
Defense Contractor Fraud: KBR
KBR, the military logistics contractor formerly tied to Halliburton, faced multiple fraud actions over its LOGCAP III contract to support U.S. forces in Iraq. The largest came in July 2023, when KBR agreed to pay $108.75 million to settle a False Claims Act whistleblower lawsuit alleging the company had deliberately ignored requirements to check existing inventory before ordering new supplies, resulting in about $340 million in excess purchases billed to the Army. The Justice Department had declined to join the case, and the whistleblowers and their attorneys litigated it for 12 years.30Phillips & Cohen. Gulf War Whistleblowers Settlement In a separate action, KBR paid $13.67 million in 2022 to resolve allegations that employees rigged subcontract bids and accepted kickbacks from Kuwaiti firms, and the government secured an additional $51 million judgment against the company for overpayments on a related subcontract.31Department of Justice. KBR Defendants Agree to Settle Kickback and False Claims Allegations
Procurement fraud remains a stated enforcement priority. In fiscal year 2025, the Department of Justice recovered a record $6.8 billion through the False Claims Act.32Department of Justice. False Claims Act Settlements and Judgments Exceed $6.8B in Fiscal Year 2025
Why Service Members Rarely Sue the Military Directly
One reason the biggest military settlements tend to target manufacturers, contractors, or VA processes rather than the armed forces themselves is the Feres Doctrine. Under that 1950 Supreme Court decision, active-duty personnel generally cannot bring tort claims against the government for injuries “incident to service.” The rule has blocked lawsuits over sexual assault, medical malpractice, and other harms for decades.33Protect Our Defenders. Feres Doctrine and Lawsuits Against the U.S. Military Explained
Congress carved out a narrow exception in 2019 with the SFC Richard Stayskal Medical Accountability Act, which created an administrative claims process for military medical malpractice. Results so far have been modest. As of October 2022, service members had filed 448 claims seeking over $4 billion in damages, but only 11 had been settled, an approval rate of 2 percent, and more than a quarter had been denied outright.33Protect Our Defenders. Feres Doctrine and Lawsuits Against the U.S. Military Explained That bottleneck is why most of the money flowing to veterans today arrives through the paths above: suits against private companies, class actions against the VA, and rulings that force the services to recompute what they already owed.