On November 3, 2020, Bayer AG, the owner of Monsanto’s Roundup weed and grass killer product line, announced it will likely have to pay $2 billion to resolve future Roundup cancer lawsuits, on top of the approximately $10 billion the German pharmaceutical giant has already paid to settle approximately 95,000 Roundup claims, in which plaintiffs allege that the herbicide caused them to develop cancer. Today, Bayer submitted to the U.S. District Court in San Francisco the $2 billion settlement to settle future claims.
But the settlement still needs to be approved by U.S. District Judge, Vince Chhabria, who is overseeing thousands of consolidated Roundup claims. In July 2020, Chhabria rejected Bayer’s initial proposal to settle future Roundup claims.
Back then, Chhabria objected to the plan by Bayer, which inherited Monsanto’s products—and lawsuits—in 2018 for $63 billion, to resolve future claims based on the judgement of a panel of scientists. In the three Roundup lawsuits that have thus far gone to trial, all of which have resulted in multi-million-dollar damage-award-judgements for the plaintiffs, juries have reached verdicts, not a scientific panel.
Bayer’s scientific panel proposal would have allowed Bayer to pick two members on the panel.
Chhabria shot down Bayer’s scientific panel proposal, saying that “The science may be evolving, how could it be appropriate to lock in a decision from a panel of scientists for all future cases?” Another concern Chhabria expressed over Bayer’s initial settlement proposal was that some class members may not have yet developed cancer.
Consequently, Chhabria told Bayer back in July of last year that it had better come up with a Plan B to settle future Roundup claims or else he would allow claims to proceed in court. And after going 0 for 3 in the first trials, Bayer most likely did not want to test their luck defending individual claims.
What’s New In Bayer’s Plan B Proposal To Settle New Roundup Claims?
For starters, Bayer has left its scientific panel idea on the table, per a NASDAQ.com report, which says that the advisory science panel’s findings would not be preclusive but can be used as evidence in potential future litigation involving class members. This means that the panel’s findings would not serve as binding evidence. However, the panel’s report would be allowed to be submitted as evidence in future lawsuits. Bayer could also use the panel’s findings for a “robust notice program” (i.e. marketing purposes).
The plan also includes research and NHL testing programs that were part of the original class agreement. Furthermore, class members will be provided legal assistance for filing their claim, and will be informed through an outreach effort about the settlement. This notification program is a critical element of the settlement because some of the class members are itinerant, non-English speaking farmworkers.
In addition, the $2 settlement, subject to approval, will cover legal fees.
Reuters says that the $2 billion deal will cover future individual claims brought forth by people who have been diagnosed with a specific type of rare cancer, non-Hodgkin’s lymphoma (NHL). The individuals covered in the settlement must have also been exposed to Roundup before their diagnosis, says Reuters. In addition, the settlement includes benefits for people who were exposed to the herbicide, and will have developed NHL in the future.
The settlement will cover class members over the next four years. Anyone who does not make a claim during the four-year period would then be able to file a claim.
How Much Will Plaintiffs Be Compensated?
Bayer will provide $2 billion for a four-year period as compensation and to cover outreach and diagnostic assistance. Future claimants could receive from $5,000 up to $200,000 under the deal. Law360.com adds that the settlement will allocate $50 million to a fund for payments above the $200,000 cap for “extraordinary” cases. Compensation will depend upon health conditions, age of the claimants, history of prior Roundup use, and other factors.
According to a press release provided by Bayer, compensation would be taken from a $1.33 billion sum. An additional $750 million would be used to fund NHL cancer monitoring programs, pay lawyer fees (who will provide free legal assistance to future victims), and, for the establishment of the aforementioned advisory panel.
According to a 2006 study published in Leukemia & Lymphoma, the mean amount of money it costs to initially treat aggressive NHL per month is nearly $11,000. Aggressive NHL costs over $14,000 a month, and cumulatively, nearly $86,000 dollars over the one-year study period (1999-2000). The study does not account for the cost of treatments for any types of complications that NHL sufferers may experience, due to a weakened immune system.
An attorney involved in the class action litigation told Reuters that non-Hodgkin’s lymphoma sufferers have the choice to reject their compensation and seek a better outcome in court.
Reuters adds that plaintiffs and Bayer can agree to extend the settlement period.
Should Bayer’s modified settlement proposal be accepted, there’s one final detail: class members will not be able to seek punitive damages. However, plaintiffs won’t be forced to go through a compensation fund, and may seek additional punitive damages through a separate suit.
How Likely Is It That The New Settlement Proposal Will Be Accepted?
Elizabeth Chamblee Burch, a professor at the University of Georgia School of Law, told Law360.com, “The big question, in my mind, is whether this is actually different enough that Judge Chhabria would be willing to approve it.”
In other news, yesterday, it was announced that shareholders of Bayer are suing the company over its acquisition of Monsanto.