Philips has reached a settlement in the United States to resolve all economic loss claims resulting from lawsuits and settlements over faulty respiratory devices, the Dutch company announced on Thursday. Over 500 lawsuits had been pending in the U.S. due to a major recall of sleep apnea devices and ventilators.
Philips had to recall millions of sleep apnea devices and ventilators due to potential health risks posed to users. If the sound-dampening foam in the devices made contact with certain cleaning materials, the foam could crumble, and users could breathe it in.
In April, Philips announced that it set aside 575 million euros to cover the potential cost resulting from lawsuits and settlements in the United States over faulty respiratory devices.
The announcement on Thursday confirmed that U.S. users with defective devices would receive financial compensation, the amount of which will depend on the specific type of device they use. They will also receive extended warranties on any replacement devices, along with an additional cash incentive if they return the recalled device to Philips. Moreover, individuals who obtained replacement devices post-recall will receive additional compensation as part of the settlement.
The Dutch company has yet to disclose the total sum allocated for the settlement. In April, the company announced that it set aside 575 million euros to cover the potential cost resulting from lawsuits and settlements in the United States over faulty respiratory devices.
Philips booked a profit of 74 million euros in the second quarter of this year, compared to a 20 million euros loss a year earlier, the company said in July.