Company seeks long term resolution as Supreme Court review continues
Bayer has announced a proposed settlement worth up to $7.25 billion to resolve thousands of lawsuits in the United States involving its weedkiller Roundup. The lawsuits claim the company failed to warn users that the product could increase the risk of non-Hodgkin lymphoma.
The proposed agreement would cover most of the remaining cases, as well as future claims from individuals exposed to Roundup before the announcement. Bayer said it would make annual payments into a special fund for up to 21 years. Individual compensation would depend on factors such as how the product was used, the age of diagnosis, and the severity of the illness.
Under the proposal, agricultural, industrial, or turf workers with long term exposure and aggressive illness diagnosed before age 60 could receive average payments of about $165,000. Residential users with less aggressive illness diagnosed between ages 60 and 77 could receive about $20,000. Those diagnosed at age 78 or older may receive around $10,000.
Bayer stated it plans to use an $8 billion secured bank loan facility to fund the settlement. However, if too many plaintiffs choose not to participate, the company has the option to cancel the agreement.
The U.S. Supreme Court is expected to hear arguments in April in a separate case involving Bayer. The company argues that because the U.S. Environmental Protection Agency approved Roundup without a cancer warning, federal law should prevent state level failure to warn claims.
“The proposed class settlement agreement, together with the Supreme Court case, provides an essential path out of the litigation uncertainty and enables us to devote our full attention to furthering the innovations that lie at the core of our mission: health for all, hunger for none,” said Bill Anderson, CEO of Bayer.
“This litigation and the resulting cost underscore the need for guidance from the Supreme Court on clear regulation in American agriculture,” said Anderson. Observers note that the Supreme Court decision will remain important for the company’s long term legal outlook.
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