(Updates to add 3M's comment in sixth paragraph.)

3M (MMM) plans to challenge the legal basis of Australia's lawsuit seeking more than A$2 billion ($1.38 billion) in damages over contamination linked to the company's firefighting foam, Reuters reported Friday, citing a court hearing.

Australia is seeking compensation for past and future cleanup costs at 28 military bases where 3M's products were used, Reuters said, adding that the government alleges the company knew or should have known the foam could harm people and the environment but failed to issue adequate warnings.

3M's lawyer argued that the allegations do not meet the legal requirements for a public nuisance claim, according to the report.

It added that the company also plans to challenge whether Australia's claims over alleged misleading statements about the foam's safety are time-barred because the conduct occurred decades ago.

The case is scheduled to return to court in December.

3M said it never manufactured PFAS in Australia and stopped selling the products at issue about two decades ago, but the Department of Defence continued to use it.

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