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Article: Bayer seals settlements on glyphosate and dicamba litigation
02 July 2020
This article is from our crop science coverage dated
29/06/20.
Bayer has settled several major legacy Monsanto litigations out
of court including with tens of thousands of plaintiffs for the
alleged link between Monsanto's glyphosate-based Roundup herbicide
and cancer.
Pending agreement of the courts, the Roundup settlements could
total between $10.1 billion - $10.9 billion.
The headline Roundup deal is among a series of agreements that
will substantially resolve major outstanding Monsanto litigation,
Bayer says. They include the US Roundup litigation, as well as the
dicamba drift, for which it has settled for $400 million, and
polychlorinated biphenyl (PCB)-contaminated water litigations with
payments totalling $820 million, it adds. The combined settlements
could total $12 billion. The glyphosate litigation settlement
covers about three-quarters of the some 125,000 filed and unfiled
claims, around 90,000 litigants.
"First and foremost, the Roundup settlement is the right action
at the right time for Bayer to bring a long period of uncertainty
to an end," Bayer group chief executive officer Werner Baumann
says. Court-appointed mediator Kenneth Feinberg rates the
glyphosate litigation agreement as "designed as a constructive and
reasonable resolution to a unique litigation". He also pays
"tribute" to Bayer for the progress made, which "provides a robust
framework that will enable the parties to bring closure to the
current Roundup litigation in due course".
The resolved glyphosate lawsuit claims include all plaintiff law
firms leading the Roundup federal multi-district litigation (MDL)
or the California bellwether cases, and those representing around
95% of the cases set for trial, and establish key values and
parameters to guide the resolution of the remainder of the claims
as negotiations advance, Bayer notes.
Furthermore, the resolution puts in place a mechanism to resolve
potential future claims efficiently, the company says. Bayer will
make a payment of $8.8-9.6 billion to resolve the current Roundup
litigation, including an allowance expected to cover unresolved
claims, and $1.25 billion to support a separate class agreement to
address any further litigation. The agreed Roundup class settlement
will be subject to approval by Judge Vince Chhabria of the US
District Court for the Northern District of California. The
agreements contain no admission of liability or wrongdoing, Bayer
stresses. The company cites uncertainty over a growing number of
litigants, extended trials, and reputational loss for its seeking a
settlement.
Outstanding cases
The claims still subject to negotiation largely consist of cases
generated by TV advertising and for which plaintiffs' law firms
have provided little or no information on the medical condition of
their clients, and/or cases held by law firms with small
inventories, Bayer explains. The three cases that have gone to
trial - Johnson, Hardeman and Pilliod - will continue through the
appeals process and are not covered by the settlement. Bayer says
that it needs to continue those cases as the appeals will provide
legal guidance. The company stresses that in an appellate court
filing, it has the support of the US government for its pre-emption
arguments, asserting that state law warning claims in the Roundup
litigation conflict with US federal law, requiring no cancer
warning, and that the case be dismissed. Earlier this week, a
federal judge blocked California from requiring a cancer warning on
glyphosate-based pesticide products, concluding that the "great
weight of evidence" indicated that the herbicide was not a known
carcinogen.
In the Dewayne Johnson case in August 2018, a California state
court found Monsanto liable for failing to add warnings that its
Roundup herbicide could have caused his cancer. The state judge
overseeing that trial reduced the $279 million award to $78
million. That case has gone to appeal in which the plaintiff is
seeking the reintroduction of the original penalty, while Bayer is
counter-suing for the case to be dismissed. In July last year, a
California state court judge slashed damages awarded to a couple,
Alva and Alberta Pilliod, in a similar lawsuit from over $2 billion
to under $87 million. In March 2019, a federal jury awarded another
California resident, Edwin Hardeman, some $80 million. In July that
year, a federal judge cut that award to just over $25 million.
Bayer further notes that potential future cases will be governed
by a class agreement, which is subject to court approval. The
agreement includes the creation of an independent class science
panel, which will determine whether Roundup can cause non-Hodgkin's
lymphoma (NHL), and if so, at what minimum exposure levels. Bayer
and the plaintiff class will be bound by the panel's findings,
taking the decision of causation out of any jury's hands. However,
that panel's determination "is expected to take several years".
Class members will not proceed with legal claims against the
company until the panel's resolution of the issue.
Dicamba settlement
Bayer has struck a $400 million mass tort agreement to settle
dicamba drift litigation related to Monsanto's XtendiMax herbicide.
That deal resolves the multi-district litigation pending in the US
District Court for the Eastern District of Missouri and claims for
the 2015-2020 crop years. Claimants will be required to provide
proof of damage to crop yields and evidence that it was due to
dicamba in order to collect. Bayer says that it expects a
contribution from BASF - its co-defendant in many of the dicamba
lawsuits - towards the settlement.
The deal does not cover the lone dicamba drift case that has
gone to trial. A jury in February awarded a Missouri peach farmer
some $250 million in punitive damages and $15
million in compensatory damage for crop damage from dicamba. Bayer
and BASF are challenging that decision.
Resolution of PCB litigation
Bayer has also made a series of agreements that resolve cases
representing most of the company's exposure to PCB water
litigation. Monsanto legally manufactured PCBs until ceasing their
production in 1977. One agreement establishes a class that includes
all local governments with EPA permits involving water discharges
impaired by PCBs. Bayer will pay approximately $650 million to the
class, subject to court approval.
The company has also sealed deals with the US Attorneys-General
of the states of New Mexico and Washington, and the District of
Columbia to resolve similar claims. Bayer will make payments on
these deals totalling some $170 million.
Several states have sued Monsanto for environmental damage from
PCB chemicals the company had manufactured and sold for
decades.