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Bayer AG is a pharmaceutical giant with total assets of about $150 billion. In 2018 it merged with Monsanto, the world’s largest biotech company, in a $63 billion deal. Monsanto was the manufacturer of the popular herbicide Roundup, which has been the subject of tens of thousands of product liability lawsuits in the US. By purchasing Monsanto, Bayer effectively purchased all of Monsanto’s potential legal liability.
Bayer bears two separate sets of legal risks over Roundup litigation:
- Over 125,000 claims have been filed by Roundup users who claim that it caused their non-Hodgkin lymphoma. Although many of these claims have been settled, tens of thousands remain
- Future claims. A certain number of future claims are inevitable because (i) it takes at least a decade between exposure to Roundup and the onset of cancer symptoms and (ii) since Roundup remains on the market, new exposures are occurring daily.
Cases That Have Already Gone to Trial
So far, only three cases have gone to trial, and the results have been very discouraging for Bayer/Monsanto. In all three cases, the plaintiff´s claim was based on Monsanto’s failure to warn users of the dangers of Roundup. Monsanto argued that it had no legal duty to place a cancer warning on the product label because the Environmental Protection Agency (EPA) approved glyphosate as safe for humans.
In all three cases, the jury not only disagreed with Monsanto, but also awarded the plaintiffs tens of millions of dollars. Monsanto appealed all three jury verdicts. Fundamentally, it lost all of its appeals, although was successful in getting its damages reduced from astronomical to merely unacceptable. Following is a summary of the results of these three cases.
Johnson v. Monsanto Co.
August 2018: The jury found that Roundup caused the non-Hodgkin lymphoma suffered by the plaintiff and that Monsanto failed to warn users of the risks involved. It awarded the plaintiff a staggering sum of $289.3 million dollars–39.3 million in compensatory damages and $250 million in punitive damages. An appeal later reduced punitive damages to $39.2 million.
Hardeman v Monsanto Co.
March 2019: A jury awarded Hardeman $80 million in total compensation, which a judge later reduced to $25 million. Monsanto lost its appeal in the Ninth Circuit Court of Appeals in San Francisco.
Pilliod v. Monsanto
May 2019: An Oakland, California jury ruled that Monsanto was liable for an unbelievable $2 billion in punitive and compensatory damages to a couple who developed non-Hodgkin lymphoma after years of using Roundup. The Superior Court of the State of California reduced the total award from over $2 billion to $86.7 million.
Further appeals for all three of the foregoing cases are still pending.
The $10.9 Billion Roundup Settlement
Multiplying the foregoing results by tens of thousands of cases, it became obvious that Roundup litigation posed an existential threat to Bayer. Moreover, the Covid-19 crisis drastically slowed the pace of litigation, potentially adding years to the total time it could take to resolve the 30,000 or so remaining cases. These two factors prompted Bayer to seek a relatively quick and simple resolution to the cases, even at a high cost.
Bayer agreed to settle 95,000 outstanding claims, including 95 percent of the cases already scheduled for trial, as well as future claims, by establishing a $10.9 billion dollar fund to settle claims with victims. More than half of these claims have since been settled. Although Bayer agreed to set aside $2 billion for future claimants, including a planned class action lawsuit, the issue is still uncertain because the judge has yet to approve it.
The Class Science Panel
Bayer funding would create a Class Science Panel to determine whether Roundup causes non-Hodgkin’s Lymphoma (NHL). If the panel concludes that it does, then Bayer cannot deny it during future litigation. If it concludes that it doesn’t, then plaintiffs cannot claim otherwise during future litigation.
The settlement terms also benefit Bayer by preventing future class action plaintiffs from seeking punitive damages or demanding medical monitoring. The problem is that since plaintiffs can opt-out of the settlement, they might do so in great numbers if the terms of the settlement fail to satisfy them. If they do, they can file individual lawsuits that are not subject to these terms.
Multidistrict Litigation (MDL)
The Bayer $10 billion settlement is based on the concept of multidistrict litigation (MDL). In MDL, a central court combines certain aspects of a case (whether Roundup causes cancer, for example), which then becomes binding on the parties. The parties then proceed to resolve the individual aspects of their cases, such as whether Roundup caused a particular plaintiff´s illness, in individual lawsuits. The purpose of MDL is to enhance efficiency in large cases with similar facts.
The settlement still requires judicial approval from U.S. District Court Judge Vince Chhabria. So far, Mr. Chabria has yet to offer approval, and he has expressed grave doubts about certain aspects of the plan. In particular, he is skeptical of the adequacy of the $2 billion that Monsanto has agreed to pay future plaintiffs, and he wonders if the authority granted to the Class Science Panel is even constitutional.
A Look at the Future
Bayer has not exhausted its appeals in the Johnson, Hardeman, and Pilliod cases. The legal arguments that they are advancing (that Bayer had no duty to warn of NHL after the EPA approved glyphosate as safe, for example) could drastically affect the course of future litigation. Furthermore, the Class Science Panel can deliberate for four years before it issues any determinations. Only then can a class action lawsuit begin.
Finally, a lot depends on the conclusions of the Class Science Panel. If it finds a causal connection between Roundup and NHL, Bayer´s future as a major pharmaceutical supplier could become uncertain. As it appears, the fight is far from over.
If you or somebody you love has experienced negative effects after exposure to Roundup, get in touch with one of our experienced products liability attorneys today.