Bayer Keeps Roundup Faith After Losing Second Trial
A jury awarded compensatory damages of $5.3 million and punitive damages of $75 million to a 70-year-old California man.
(Bloomberg) -- Bayer AG vowed to keep defending its weedkiller Roundup after losing a second trial over claims it causes cancer, indicating that the embattled company isn’t yet ready to consider spending billions of dollars to settle thousands of similar lawsuits.
A jury in San Francisco federal court awarded compensatory damages of $5.3 million and punitive damages of $75 million to a 70-year-old man who became ill after spraying the herbicide on his property for decades. Wednesday’s verdict follows a similar decision by a state court jury last summer, and comes as a third trial is under way in Oakland, California.
The company will continue to “vigorously defend” the herbicide, which it considers safe, Christian Hartel, a spokesman, said by phone from Bayer’s headquarters in Leverkusen, Germany. It plans to appeal the verdict and doesn’t view the ruling as a harbinger for others because each trial has different factual and legal circumstances.
Some experts disagree. “You can’t keep trying case after case after case and keep losing and say, ‘We’re not going to settle,” said Thomas G. Rohback, a trial lawyer at Axinn in New York. If Bayer continues to lose at trial, it “has to put the possibility of a settlement of these cases into the mix.”
Roundup became the German company’s leading headache after it acquired Monsanto Co. for about $63 billion last June. Bayer has lost more than 40 percent of its value since the transaction. On Thursday, its shares fell as much as 3.3 percent to 54.48 euros in Frankfurt, the lowest level in more than six years.
The case was brought by Edwin Hardeman, who used the herbicide on his large plot of land in Sonoma County, about 60 miles north of San Francisco. As with the thousands of other consumers suing Bayer, Hardeman argued his years of exposure to the chemical caused his non-Hodgkin’s lymphoma.
The jury found that there’s a defect in Roundup, that Bayer failed to warn of the product’s risks and that the company was negligent.
Some analysts have put the price of settling lawsuits over Roundup filed by more than 11,200 people in the U.S. at more than $5 billion. Rohback said Bayer may be pursuing a “long game,” based on a strategy of continuing to fight in hopes of finding some plaintiffs it can beat.
What Bloomberg Intelligence Says
"A new $80 million verdict against Bayer over claims its weedkiller caused a consumer’s cancer signals a tough slog ahead for the company in many of the 11,200 cases pending across the U.S."
--Holly Froum, Litigation analyst
Click here to view the piece.
The Roundup verdict is the third-largest product liability jury award in the U.S. so far in 2019, according to data compiled by Bloomberg. The largest such verdict, for $151.8 million, was issued by an Alabama jury last month against Ford Motor Co., over an Explorer rollover accident.
Bayer won’t have the advantage in Oakland that it had in San Francisco federal court. Hardeman’s trial was split into two parts, a format that legal experts said gave the company its best chance of evening the score after it lost the first Roundup trial last summer and was ultimately ordered to pay $78.6 million in damages.
Secret Campaign
Instead, the Oakland trial will permit lawyers to present jurors at the outset with their narrative about Monsanto Co.’s secret campaign to manipulate public opinion and bury evidence of Roundup’s cancer risks.
Jurors in Hardeman’s case first sat through weeks of scientific testimony to decide whether Roundup was a “substantial factor” in causing his illness before they heard any evidence that Monsanto ghostwrote influential studies and improperly leaned on regulators. Bayer countered that scientific studies showed the herbicide is safe and argued to the jury that damning emails were taken out of context.
Hardeman sought more than $19 million in damages, including compensation for hospital bills as well as pain and suffering.
Monsanto’s Actions
His lawyers said the verdict sends a message to Monsanto that it needs to change the way it does business.
“It speaks volumes that not one Monsanto employee, past or present, came live to trial to defend Roundup’s safety or Monsanto’s actions,” Aimee Wagstaff and Jennifer Moore said in a statement.
Bayer’s adversaries in Oakland are Alva and Alberta Pilliod, a couple in their 70s who invoked a California law that gives scheduling preference to people who are ill. A school groundskeeper who won the first trial against Bayer in August relied on the same law. Bayer is appealing the August verdict, too.
If the losses keep coming, Rohback said, Bayer’s only justification for continuing to fight is if plaintiffs’ lawyers are making unrealistic demands to resolve the litigation. “At some point you’re not getting a lot of encouragement to go forward with the same approach,” he said.
The case is In re: Roundup Products Liability Litigation, MDL 2741, U.S. District Court, Northern District of California (San Francisco).
--With assistance from Margaret Cronin Fisk and Naomi Kresge.
To contact the reporters on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net;Robert Burnson in San Francisco at rburnson@bloomberg.net;Tim Loh in Munich at tloh16@bloomberg.net
To contact the editors responsible for this story: Elizabeth Wollman at ewollman@bloomberg.net, John Lauerman, Thomas Mulier
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