Bayer Jury Awards $2 Billion Damages in Third Roundup Trial

(Bloomberg) -- Bayer AG was ordered to pay more than $2 billion in damages to a California couple that claimed they got cancer as a result of using the company’s Roundup weedkiller for about 30 years.

It’s the largest jury award in the U.S. so far this year and the eighth-largest ever in a product-defect claim, according to data compiled by Bloomberg. Bayer has now lost three trials in a row over claims Roundup causes cancer.

A jury in state court in Oakland, California, issued the verdict Monday after two other California trials over the herbicide yielded combined damages of $159 million against the company. Bayer is appealing those verdicts and vowed to challenge Monday’s as well, calling it “excessive and unjustifiable.”

The verdict “conflicts directly with the U.S. Environmental Protection Agency’s interim registration review decision released just last month, the consensus among leading health regulators worldwide that glyphosate-based products can be used safely and that glyphosate is not carcinogenic,” Bayer said in a statement.

When the company’s lawyer asked a juror after the verdict what the panel wanted to hear from Bayer, the juror responded that he wanted proof the chemical was safe: “I wanted you to get up and drink it.” The juror declined to be identified.

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The jurors agreed that Alva and Alberta Pilliod’s exposure to Roundup used for residential landscaping was a “substantial factor” in their non-Hodgkin’s lymphoma. In addition to $1 billion for each spouse, the jury awarded damages of about $55 million for the couple’s medical bills and pain and suffering.

The verdict will be vulnerable to a legal challenge by Bayer because courts have generally held that punitive damages shouldn’t be more than 10 times higher than compensatory damages.

Monsanto Co., the maker of Roundup acquired by Bayer last June, is the named defendant in similar U.S. lawsuits filed by at least 13,400 plaintiffs.

“The verdict in this trial has no impact on future cases and trials, as each one has its own factual and legal circumstances,” Bayer said in its statement.

While it was a “risky move” to ask for an award of more than $1 billion -- and the damages will probably be reduced by the judge -- the three verdicts against Bayer show jurors are convinced by evidence against the company, said Anna Pavlik, senior counsel for special situations at United First Partners LLC in New York.

“In this case there appeared to be more detailed evidence damaging to Monsanto, which strengthens plaintiffs’ cases down the pipeline even further,” said Pavlik, who has followed the trials.

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Bayer Chief Executive Officer Werner Baumann faces increased shareholder pressure over the litigation it inherited from Monsanto as investors have been closely watching developments in the costly Roundup lawsuits. Bayer shares have fallen about 40 percent since the $63 billion Monsanto acquisition. Bayer is scheduled to face more trials over the same claims this summer in St. Louis.

The Pilliods’ lawyer urged jurors to punish the company for covering up the health risks of the herbicide for decades. Brent Wisner told the panel his punitive damages request was roughly based on the gross profit of $892 million recorded in 2017 by Monsanto’s agricultural-chemicals division.

After the verdict, the attorney said the evidence showed that “from day one, Monsanto has never had any interest in finding out whether Roundup is safe.”

“Instead of investing in sound science, they invested millions in attacking science that threatened their business agenda,” Wisner said in a statement.

Monsanto countered that the Pilliods had histories of poor health, disease and compromised immune systems that increased their risk of developing cancer. Defense attorney Tarek Ismail emphasized that Monsanto wouldn’t be responsible if the couple would have developed lymphoma without exposure to Roundup.

Asked about the $2 billion in punitive damages, juror Doug Olsen said that while he didn’t agree with the outsize sum, the jury agreed to send the company a message.

“We really wanted to tell Monsanto, ‘Cut it out, do better,’ and we wanted to get their attention," Olsen said. Jurors wanted Bayer to “take us seriously," he said, adding that a significantly lesser sum wouldn’t have the “same punch-in-the-gut effect."

While some investors think a third loss could accelerate a global settlement, which analysts have said could top $5 billion, Pavlik thinks Bayer will fight on because it won’t start negotiating from a position of weakness.

If plaintiffs continue to win cases decided by juries in Missouri, the momentum in their favor “may push Bayer to begin to negotiate,” she said.

The Oakland case is Pilliod v. Monsanto Co., RG17862702, California Superior Court, County of Alameda (Oakland).

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