Speaker 1: Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every
Speaker 1: day we bring you insight and analysis into the most
Speaker 1: important legal news of the day. You can find more
Speaker 1: episodes of the Bloomberg Law Podcast on Apple Podcasts, SoundCloud
Speaker 1: and on Bloomberg dot com slash podcasts. A second jury
Speaker 1: returned averted against Buyer overclaims that it's round up weed
Speaker 1: killer causes cancer. The trial now moves to a second
Speaker 1: phase to determine the company's liability and any damages for
Speaker 1: Edwin Hardeman, who sprayed the who said that he sprayed
Speaker 1: the herbicide on his property for decades and that it
Speaker 1: caused his non Hodgkins lymphoma. These are just the first
Speaker 1: two cases out of more than eleven thousand. Joining me
Speaker 1: is Eric Gordon, a professor at the University of Michigan
Speaker 1: Law School and Business School. Eric first described the way
Speaker 1: the proceedings were split at Buyer's request and to its advantage. Yeah, Jenn,
Speaker 1: and that's actually an important point in the outcome here.
Speaker 1: Buyer convinced the judge to try the case in two
Speaker 1: separate phases so that jurors first would decide whether round
Speaker 1: up was a substantial factor in the plaints of cancer
Speaker 1: before the jury got to hear about alleged wrongdoing by
Speaker 1: the company. The alleged wrongdoing being and failing to warn
Speaker 1: people about cancer risks and maybe hiding evidence. So this
Speaker 1: was Bears. This was Bear's new card in their defense strategy.
Speaker 1: So will this second phase be a steeper climb for
Speaker 1: the defense as jurors will hear some damaging evidence which
Speaker 1: you referenced that mont Santo ghost wrote scientific literature to
Speaker 1: ensure that Roundup was not classified as christinogenic. Yeah, Now
Speaker 1: the jury is going to get to hear the emotionally
Speaker 1: flammable evidence that the evidence that, if believed, makes Buyer
Speaker 1: look like really bad people. The exact evidence. This was
Speaker 1: that nature of the evidence that made buyer wanted not
Speaker 1: to be in the first phase, so they got kind
Speaker 1: of a clean decision about about whether it caused cancer.
Speaker 1: So it only gets worse for buyer. The company insists
Speaker 1: that the active ingredient in the herbicide does not cause cancer.
Speaker 1: Buyers share price has dropped since its acquisition of mon
Speaker 1: Santo in June. Will it continue to face these lawsuits
Speaker 1: until it changes the ingredients in Roundup? Yeah, and maybe
Speaker 1: even after them because the lawsuits are about people who
Speaker 1: say they were hurt by the old ingredients, and you
Speaker 1: know what's going on here? Is there short of two
Speaker 1: levels of reality? There's some level of scientific reality. Buyer
Speaker 1: says there are many, many, many, many studies, including studies
Speaker 1: that had nothing to do with that say it doesn't
Speaker 1: cause cancer. The e p A didn't require a warning.
Speaker 1: European people didn't require a warning. That's one level, but
Speaker 1: there's another level. And the other level is what jurors
Speaker 1: will believe. And what jurors will believe is what turns
Speaker 1: into judgments and financial liabilities and the risk to the
Speaker 1: stock price. According to Bloomberg Intelligence, the settlement value of
Speaker 1: all the cases would be more than five billion dollars.
Speaker 1: Will this verdict edge the company to a settlement or
Speaker 1: is it too soon? Yeah? I think it's too soon.
Speaker 1: You don't want to settle. You don't want to settle
Speaker 1: on something that looks like weakness and a loss. So
Speaker 1: I don't think they're ready to settle. I think they're
Speaker 1: ready to continue their battle. It's it's one jury. Uh,
Speaker 1: it's we don't know what another jury would be. It's
Speaker 1: not good news for Buyer, but it is just one jury.
Speaker 1: The last jury returned a verdict of two nine million
Speaker 1: dollars which was reduced by a judge to seventy eight
Speaker 1: point six million, So they were very unhappy with the
Speaker 1: way Monsanto conducted itself over the years. Yeah, that was
Speaker 1: a socket to verdict technically, term um, you know that
Speaker 1: if you get the jury mad at the defendant, and
Speaker 1: the defendant is a big corporation, then you can really
Speaker 1: get these big verdicts that the judge is cut down
Speaker 1: and even the seventy eight million dollar one might be
Speaker 1: cut down further on appeal. Now, this judge and apparently
Speaker 1: he was almost bent over backwards for Buyer during the
Speaker 1: first part of the trial and made sure that a
Speaker 1: lot of evidence didn't get in at this point. But
Speaker 1: now at the second part of the trial he's being
Speaker 1: a little more expansive and he said he wrote that
Speaker 1: there is strong evidence from which a jury could conclude
Speaker 1: that quote Monsanto does not particularly care whether it's product
Speaker 1: is in fact giving people cancer, focusing instead on manipulating
Speaker 1: public opinion and undermining anyone who raises genuine and legitimate
Speaker 1: concerns about the issue. So if the judge feels that
Speaker 1: there's strong evidence. What's the jury likely to feel? Oh boy,
Speaker 1: you never know. But that wasn't That was not good news. Um. Actually,
Speaker 1: Joel Rosenblatt, one of your Boomberg colleagues, wrote something that
Speaker 1: I read this morning on my on my terminal that
Speaker 1: covers us really well, did a really good piece. Um.
Speaker 1: The judge was very fair to Buyer. Um. Maybe in
Speaker 1: part because the judge wanted this verdict to be bulletproof
Speaker 1: difficult to appeal. So one result is that one ground
Speaker 1: for appeal that Buyer has tried to use, which is
Speaker 1: that these these trials should be separated into two phases.
Speaker 1: That went away because the judge, Judge Trowberry, gave him
Speaker 1: the two phases. So that's the extra bit of bad news. This.
Speaker 1: This is gonna be a tougher one to appeal if
Speaker 1: Buyer in the end loses some another big judgment. So
Speaker 1: there are several more trials already scheduled in California and St. Louis.
Speaker 1: Does Buyer learn from these from the prior trials? Do
Speaker 1: they change their strategy? Yeah? Whenever you try, whether you
Speaker 1: win or lose, you you you review everything, your review
Speaker 1: everything that you think worked with the jury. Everything you
Speaker 1: think didn't work with the jury, you've seen a little
Speaker 1: bit more about what the other side is going to
Speaker 1: say and what they're gonna do to tear your pace,
Speaker 1: your case apart. So when you have a series of trials,
Speaker 1: when you have these like kind of mass mass towards
Speaker 1: kinds of things with series of trials, um, the really
Speaker 1: important thing to do in these early cases is to
Speaker 1: learn as much as you can, and they are learning
Speaker 1: a great deal, I assume because these cases also are
Speaker 1: are rather long. They're not They're not short cases by
Speaker 1: any means. This next phase is expected to be about
Speaker 1: two weeks long of the second phase of this trial.
Speaker 1: Thanks so much, Eric, that's Eric Gordon. He's a professor
Speaker 1: at the University of Michigan Law School and Business School.
Speaker 1: Thanks for listening to the Bloomberg Law Podcast. You can
Speaker 1: subscribe and listen to the show on Apple Podcasts, SoundCloud,
Speaker 1: and on Bloomberg dot com slash podcast. I'm June Brosso.
Speaker 1: This is Bloomberg m HM.