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Bayer Roundup Mediator Is ‘Optimistic’ With Talks Heating Up

Bloomberg logoBloomberg 1/10/2020 Jef Feeley

(Bloomberg) -- Bayer AG’s settlement talks over tens of thousands of lawsuits alleging its Roundup herbicide causes cancer are heating up as the company’s lawyers meet with individual attorneys representing consumers across the U.S., according to people familiar with the negotiations.

The sessions are focused on resolving separate groups of Roundup claims rather than creating a formal global-resolution program, according to the people, who asked not to be identified because they aren’t authorized to comment publicly about the discussions. A law professor said that approach may help the company avoid an astronomical payout.

Washington-based attorney Ken Feinberg, appointed by a federal judge to serve as a settlement mediator, confirmed the meetings Thursday. “There are talks with various lawyers around the nation who have significant inventories of Roundup cases,” Feinberg said in an interview. “I’m optimistic we can reach a comprehensive settlement of this litigation.”

Chris Loder, a U.S.-based spokesman for Bayer, said “the mediation process is continuing diligently and in good faith to explore resolution under the auspices of Ken Feinberg.”

Bayer shares rose as much as 1.7% on Friday in Frankfurt.

Several trials in California and Missouri have been postponed, which lawyers said reflects the German drug and chemical giant’s effort to resolve the massive litigation exposure it took on with the purchase of the weedkiller’s maker, Monsanto Co., in 2018.

To spur settlements, some of Bayer’s lawyers are warning that Monsanto may be forced to seek bankruptcy protection if favorable deals can’t be reached to wipe out the more than 40,000 cases pending and any future suits, according to the people. Loder declined to comment on the prospects of a bankruptcy filing.

Three Losses

Bayer lost its first three trials to consumers who claimed exposure to the weedkiller caused them to develop non-Hodgkin’s lymphoma. Juries in those cases, all in California, awarded a combined total of more than $2.4 billion in damages. Judges later reduced the damages and Bayer has appealed the verdicts.

Read More: Bayer’s Grim Year Closes on Bright Note as EPA Backs Roundup

The company has vowed to keep defending Roundup and faces more trials this month in California and in St. Louis, which is known as a plaintiff-friendly venue. It’s where a jury hit Johnson & Johnson in 2018 with a $4.7 billion verdict in a case brought by women who said they got cancer from using baby powder. J&J is appealing that verdict.

Major Bayer investors -- such as U.S.-based billionaire Paul Singer’s Elliott Management Corp. -- have urged the company to drop its defend-at-all-cost approach to the suits and consider a settlement.

The number of Roundup cases has skyrocketed with Bayer’s trial losses. Other companies faced with a tsunami of suits -- such as the litigation over Purdue Pharma LP’s marketing of its OxyContin opioid painkiller -- have filed for Chapter 11 protection from creditors to cut their losses.

Feinberg said he’s “not heard one word” about Monsanto contemplating bankruptcy to deal with the Roundup litigation.

Jennifer Moore, a Louisville, Kentucky-based lawyer, helped persuade a Roundup jury in California to award her client $80.3 million, later reduced to $25.3 million.

“We are always willing to continue negotiations on behalf of our clients.” she said in an emailed statement.

42,700 Cases

Bayer may be trying to negotiate individual lawyers’ cases, rather than dealing with all 42,700 cases in a structured settlement program, to hold down the total payout, said Carl Tobias, a University of Richmond law professor who teaches about mass-tort litigation.

He said some companies -- such as the drugmaker Wyeth -- saw their settlement costs spiral out of control after they set up comprehensive settlement programs to resolve suits. Wyeth, which made the fen-phen weight-loss combination, wound up paying as much as $21 billion to settle all the cases alleging it caused heart problems. The company is a unit of Pfizer Inc.

“When you have a formal program, you have to deal with the weight of all the cases combined when you start figuring out a settlement,” he said. “Limiting negotiations to individual lawyers or small groups gives the company a negotiating edge.”

The case is In re: Roundup Products Liability Litigation, MDL 2741, U.S. District Court, Northern District of California (San Francisco).

(Updates with shares in fifth paragraph)

To contact the reporter on this story: Jef Feeley in Wilmington, Delaware at jfeeley@bloomberg.net

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Peter Blumberg

For more articles like this, please visit us at bloomberg.com

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