Bayer to Settle Monsanto Lawsuits for $1.2 Billion

Bayer AG said it agreed to pay $650 million to settle claims by cities, counties and ports across the U.S. that toxic chemicals produced by Monsanto Co. for decades before they were banned polluted rivers and bays after leaching into storm-water runoff.

The company said it also will pay an additional $170 million to resolve PCB contamination claims by three U.S. states and $400 million to end litigation involving another Monsanto product -- dicamba-based herbicide. Dicamba has been blamed for wreaking havoc on farms across the U.S. Midwest by drifting from fields where it was sprayed to neighboring crops that weren’t genetically engineered to resist the herbicide.

The proposed settlements announced Wednesday, which will require court approval, came as Bayer also finalized a major settlement of U.S. lawsuits claiming Roundup weedkiller caused cancer in some users, a move to end litigation the German chemical giant inherited with the 2018 acquisition of Monsanto.

Cities including Seattle, San Diego, Portland, Oregon and Oakland, California sued Monsanto -- the exclusive maker of PCBs used to cool heavy-duty electrical equipment for more than 40 years -- prior to the acquistion by Bayer that left it to deal with the pollution problems tied to the chemicals.

Companies that used the non-bioegdradable chemicals sometimes fouled manufacturing areas and the pollutants ended up in the soil. The PCBs would run into major water bodies when it rained, killing fish and making the water a health hazard.

The chemical got widespread attention in the 1970s when the U.S. government learned that two General Electric Co. plants had been dumping PCBs in the Hudson River for decades, turning 200 miles of the New York waterway into one of the biggest Superfund sites. The Environmental Protection Agency prohibited PCBs in 1979 and has concluded that it’s probably a human carcinogen.

None of the lawsuits by cities and ports over PCB pollution has gone to trial, but earlier this year a federal judge ruled in favor of Monsanto in a lawsuit by San Diego, where the bay is heavily polluted with PCBs from shipbuilding and wartime activities.

The judge agreed with the company that the city couldn’t go to trial on its public nuisance allegation because it hadn’t come up with sufficient evidence linking an investigation and cleanup of its stormwater system specifically with PCBs in the San Diego Bay rather than other pollutants. A case by the city of Spokane, Washington, had been scheduled to go to trial next month.

In the one dicamba case that went to trial, a jury in February awarded a Missouri peach farmer $265 million against Bayer and BASF SE. Bayer is challenging the verdict.

In court filings, Bayer has said Monsanto stopped making PCBs before it was banned. It’s also argued that in many cases other companies were more responsible for allowing the chemical compound to contaminate waterways, which the company argued should reduce any lingering liability for Bayer.

For example, Bayer said Monsanto had no role in discharging PCBs into the Duwamish River, in Washington, which was so polluted the federal government declared it a Superfund site in 2001. When Seattle sued Monsanto in 2016, the company was only targeted because it made the chemical, David Snively, the company’s general counsel at the time, said in a letter to the Seattle Times newspaper.

It was the city and its utility company that “operated numerous substations, transmission lines and electrical-generation facilities, as well as numerous storm-water facilities, including sewer lines and combined sewer outfalls, and solid-waste handling facilities,” Snively wrote. “All of these facilities are potential sources of PCBs.”

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