1 00:00:03,480 --> 00:00:07,560 Speaker 1: Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every 2 00:00:07,640 --> 00:00:10,440 Speaker 1: day we bring you insight and analysis into the most 3 00:00:10,480 --> 00:00:13,399 Speaker 1: important legal news of the day. You can find more 4 00:00:13,440 --> 00:00:18,040 Speaker 1: episodes of the Bloomberg Law Podcast on Apple Podcasts, SoundCloud 5 00:00:18,320 --> 00:00:22,560 Speaker 1: and on Bloomberg dot com slash podcasts. Buyer has lost 6 00:00:22,600 --> 00:00:25,320 Speaker 1: a second trial over claims that it's round Up we'd 7 00:00:25,400 --> 00:00:28,520 Speaker 1: killer causes cancer, and it was a big loss. The 8 00:00:28,640 --> 00:00:32,360 Speaker 1: jury awarded eighty point three million dollars to Edwin Hardeman, 9 00:00:32,600 --> 00:00:35,559 Speaker 1: who sprayed the herbicide on his property for decades and 10 00:00:35,600 --> 00:00:39,680 Speaker 1: said it caused his non Hodgkins lymphoma. Seventy five million 11 00:00:39,720 --> 00:00:43,560 Speaker 1: of that award was punitive damages. Buyer plans to appeal 12 00:00:43,640 --> 00:00:46,400 Speaker 1: the verdict and vowed to keep defending round Up, which 13 00:00:46,440 --> 00:00:49,199 Speaker 1: it says is safe, as it faces more than eleven 14 00:00:49,240 --> 00:00:52,519 Speaker 1: thousand lawsuits joining me as Robert Hockett, a professor at 15 00:00:52,520 --> 00:00:58,640 Speaker 1: Cornell Law School, Bob, what did the jury find here? Oh? So, yeah, 16 00:00:58,680 --> 00:01:00,520 Speaker 1: it found a couple of things. Up. Of the first, 17 00:01:00,680 --> 00:01:03,480 Speaker 1: there's several questions that kind of combine in a case 18 00:01:03,520 --> 00:01:05,400 Speaker 1: like this, right, So the first sense to do with 19 00:01:05,480 --> 00:01:09,360 Speaker 1: whether indeed there is a significant cancer risk associated with 20 00:01:09,360 --> 00:01:13,039 Speaker 1: a particular product. Right. Another thing then is um was 21 00:01:13,080 --> 00:01:16,039 Speaker 1: there some kind of culpability on the part of the 22 00:01:16,120 --> 00:01:19,080 Speaker 1: firm in sort of failing to notify people of this 23 00:01:19,200 --> 00:01:21,640 Speaker 1: danger or failing to look into whether there was a danger, 24 00:01:21,959 --> 00:01:24,280 Speaker 1: failing to rectify it in some way. And then finally 25 00:01:24,280 --> 00:01:27,200 Speaker 1: a third question is what is the precise relation between 26 00:01:27,240 --> 00:01:30,320 Speaker 1: this sort of cancer causing agent within the round up 27 00:01:30,319 --> 00:01:32,520 Speaker 1: we'd killer in this case on the one hand, and 28 00:01:32,560 --> 00:01:36,080 Speaker 1: the particular plaintiff before the court on the other hand. Right, So, 29 00:01:36,120 --> 00:01:39,319 Speaker 1: what the court found um uh at the first phase 30 00:01:39,360 --> 00:01:41,399 Speaker 1: of the trial was that there is there does indeed 31 00:01:41,440 --> 00:01:45,200 Speaker 1: appear to be uh this significant cancer risk that comes 32 00:01:45,240 --> 00:01:48,800 Speaker 1: with round up. And what remains then to be decided 33 00:01:49,040 --> 00:01:52,600 Speaker 1: um was well, to what degree is the company culpable 34 00:01:52,720 --> 00:01:55,200 Speaker 1: right for not having um you know, not having done 35 00:01:55,240 --> 00:01:58,080 Speaker 1: more to prevent the danger from occurring, or for not 36 00:01:58,120 --> 00:02:00,280 Speaker 1: having done more to sort of warn the public about it. Now, 37 00:02:00,320 --> 00:02:02,360 Speaker 1: that wouldn't be Buyer itself, of course, that would have 38 00:02:02,400 --> 00:02:05,720 Speaker 1: been Monsanto. But Buyer, as the acquirer of mon Santo 39 00:02:05,840 --> 00:02:10,639 Speaker 1: last June, basically succeeds mon Santo to its own its liabilities. 40 00:02:11,639 --> 00:02:15,440 Speaker 1: Bob Buyer says, This verdict isn't a harbinger of others, 41 00:02:15,480 --> 00:02:19,440 Speaker 1: because each trial has different facts and legal circumstances. But 42 00:02:19,760 --> 00:02:22,920 Speaker 1: both juries found that round up caused cancer, and both 43 00:02:22,960 --> 00:02:27,800 Speaker 1: found punitive damages based on Monsanto's past conduct. So do 44 00:02:27,840 --> 00:02:31,280 Speaker 1: you agree with Buyer? UM? I think it's it's I 45 00:02:31,320 --> 00:02:33,960 Speaker 1: can see why it wants to say what it's saying 46 00:02:34,200 --> 00:02:36,720 Speaker 1: right now in order effectively, I think, to sort of 47 00:02:36,760 --> 00:02:39,280 Speaker 1: calm fears on the part of its investors who might 48 00:02:39,320 --> 00:02:41,959 Speaker 1: be worried that they're more liabilities, had more losses ahead, 49 00:02:42,000 --> 00:02:43,600 Speaker 1: and so it's trying to make a little bit less 50 00:02:43,600 --> 00:02:47,200 Speaker 1: worried I think about future liabilities and losses. UM. That 51 00:02:47,320 --> 00:02:50,640 Speaker 1: being said, UM, I really very much hope that Buyer 52 00:02:50,760 --> 00:02:54,359 Speaker 1: doesn't actually believe entirely what it's been saying, because if 53 00:02:54,400 --> 00:02:57,120 Speaker 1: it does, then that suggests that it's going to adopt 54 00:02:57,120 --> 00:02:59,040 Speaker 1: the strategy that I think is actually quite risky for 55 00:02:59,040 --> 00:03:02,000 Speaker 1: the company. And the reason for that, in turn is that, well, 56 00:03:02,040 --> 00:03:04,000 Speaker 1: you know, there does seem to be a pretty strong 57 00:03:04,080 --> 00:03:07,359 Speaker 1: case to be made or to the effect that UM 58 00:03:07,480 --> 00:03:11,000 Speaker 1: the chemical agent is indeed problematic. There also seems to 59 00:03:11,000 --> 00:03:12,960 Speaker 1: be a pretty strong case to the effect that Monsanto 60 00:03:13,360 --> 00:03:15,320 Speaker 1: tried to hide this fact. And what that means is 61 00:03:15,320 --> 00:03:18,119 Speaker 1: that the only question remaining for buyer is the kind 62 00:03:18,120 --> 00:03:20,120 Speaker 1: of plaintif by plaintiff question as to whether you know 63 00:03:20,160 --> 00:03:23,040 Speaker 1: this plaintiff was affected, or whether there's a causal relation 64 00:03:23,120 --> 00:03:26,520 Speaker 1: between this plaintiff's cancer and that agent, or that plaintiffs 65 00:03:26,560 --> 00:03:28,480 Speaker 1: cancer and the agents and so on, and there you 66 00:03:28,480 --> 00:03:30,239 Speaker 1: have a total crapshoot. It really depends on who the 67 00:03:30,240 --> 00:03:32,600 Speaker 1: plaintiffs are. But most plankets aren't going to bring cases 68 00:03:32,639 --> 00:03:35,120 Speaker 1: like this. It doesn't seem to be unless they can show, 69 00:03:35,360 --> 00:03:38,680 Speaker 1: you know, significant exposure to that chemical agent. And these 70 00:03:38,720 --> 00:03:42,080 Speaker 1: are just the first two cases out of about eleven thousand, 71 00:03:42,120 --> 00:03:45,840 Speaker 1: two hundred. According to Bloomberg Intelligence, the settlement value of 72 00:03:45,920 --> 00:03:49,839 Speaker 1: all round up cases could exceed five billion dollars. When 73 00:03:49,880 --> 00:03:53,640 Speaker 1: does buyer begin to feel real pressure to settle these cases? 74 00:03:54,560 --> 00:03:57,160 Speaker 1: I think I think it really it ought to be 75 00:03:57,200 --> 00:03:59,720 Speaker 1: feeling that pressure now, right. It ought to be reading 76 00:03:59,760 --> 00:04:02,880 Speaker 1: those previous decisions, I think very carefully. The one thing 77 00:04:02,880 --> 00:04:04,280 Speaker 1: that it seems to be hanging its hat on, and 78 00:04:04,320 --> 00:04:05,880 Speaker 1: maybe there are two things that's hanging its hat on. 79 00:04:06,160 --> 00:04:08,760 Speaker 1: So there's another trial coming up up in San Francisco 80 00:04:08,880 --> 00:04:10,800 Speaker 1: and Buyer appears to believe that the judge you will 81 00:04:10,800 --> 00:04:14,160 Speaker 1: be hearing or presiding over that trial is himself a 82 00:04:14,160 --> 00:04:17,480 Speaker 1: bit more skeptical about the claims of causation between the 83 00:04:17,560 --> 00:04:20,120 Speaker 1: chemical agents presence on the one hand and people's developing 84 00:04:20,120 --> 00:04:22,800 Speaker 1: cancer on the other. So Buyer seems to be very 85 00:04:22,880 --> 00:04:25,680 Speaker 1: much betting on a favorable ruling from that judge is 86 00:04:25,720 --> 00:04:28,440 Speaker 1: a little bit more skeptical about the causal link. If 87 00:04:28,480 --> 00:04:31,800 Speaker 1: that judge were not to sort of demonstrate that skepticism, 88 00:04:31,800 --> 00:04:33,720 Speaker 1: and if Buyer were to lose there, I would think 89 00:04:33,760 --> 00:04:35,440 Speaker 1: that would be the finally on the coffin for them, 90 00:04:35,440 --> 00:04:37,760 Speaker 1: and they would probably think, you know, decide that it's 91 00:04:37,760 --> 00:04:40,760 Speaker 1: prudence to go ahead and settle across the board. If 92 00:04:40,800 --> 00:04:43,359 Speaker 1: they win, I think it's probably still a bad idea 93 00:04:43,440 --> 00:04:45,200 Speaker 1: not to settle, but at least they might think of 94 00:04:45,200 --> 00:04:47,520 Speaker 1: themselves as being in the game a bit longer now. 95 00:04:47,560 --> 00:04:52,560 Speaker 1: About this verdict was punitive damages, meaning to punish the 96 00:04:52,600 --> 00:04:56,800 Speaker 1: company for conduct. What message was that jury sending to Buyer? 97 00:04:58,200 --> 00:05:00,440 Speaker 1: It was sort of telling Buyer that, you know, you 98 00:05:00,560 --> 00:05:03,880 Speaker 1: probably you might have done better in June too, have 99 00:05:03,880 --> 00:05:06,760 Speaker 1: paid a little bit more attention to the perspective liability 100 00:05:06,880 --> 00:05:10,479 Speaker 1: of liabilities of Monsanto before you bought it. My understanding 101 00:05:10,520 --> 00:05:12,640 Speaker 1: is that right before the acquisition, most of the attention 102 00:05:12,640 --> 00:05:15,080 Speaker 1: that was paid was paid to the regulatory concerns about 103 00:05:15,080 --> 00:05:18,920 Speaker 1: whether right that the purchase would be permitted, and in consequence, 104 00:05:18,960 --> 00:05:22,880 Speaker 1: I think there might have overlooked or maybe paid insufficient 105 00:05:22,880 --> 00:05:25,880 Speaker 1: attention to the potential liability risk that would be coming 106 00:05:25,880 --> 00:05:29,200 Speaker 1: along with Monsanto, because when you acquire a company like Monsanto, 107 00:05:29,320 --> 00:05:31,400 Speaker 1: you do, of course acquire the bad along with the good, 108 00:05:31,760 --> 00:05:34,279 Speaker 1: and they don't appear to have researched the bad quite 109 00:05:34,279 --> 00:05:36,479 Speaker 1: as thoroughly as they might have done, maybe again, because 110 00:05:36,480 --> 00:05:39,080 Speaker 1: they were preoccupied with whether it would be regulatorily allowed 111 00:05:39,120 --> 00:05:42,000 Speaker 1: for them to purchase it at all. Hardeman's trial was 112 00:05:42,040 --> 00:05:45,360 Speaker 1: split into two parts. It was a format that Buyer 113 00:05:45,400 --> 00:05:48,240 Speaker 1: thought would give it the best chance. This verdict was 114 00:05:48,360 --> 00:05:51,920 Speaker 1: less than the previous verdict, which was two nine million 115 00:05:51,920 --> 00:05:54,440 Speaker 1: dollars and then knocked down by a judge to seventy 116 00:05:54,520 --> 00:05:57,839 Speaker 1: eight point six. Is that random or is that the 117 00:05:57,920 --> 00:06:01,279 Speaker 1: result of the two phase trial? Did it work for buyer? 118 00:06:02,120 --> 00:06:04,680 Speaker 1: I'm inclined to think that it was random because buyer 119 00:06:04,839 --> 00:06:07,440 Speaker 1: was hoping for is they were hoping that if we 120 00:06:07,480 --> 00:06:10,919 Speaker 1: could kind of split up the well back up for 121 00:06:11,000 --> 00:06:14,359 Speaker 1: one second a twilight. This basically implicates all three of 122 00:06:14,360 --> 00:06:16,320 Speaker 1: the questions that I mentioned from the top right. Is 123 00:06:16,360 --> 00:06:19,000 Speaker 1: the agent itself a cancer causing agent? Is there a 124 00:06:19,080 --> 00:06:22,679 Speaker 1: cause of relation between the plaintiff's use of the chemical 125 00:06:22,760 --> 00:06:24,520 Speaker 1: on the one hand and getting the cancer on the other, 126 00:06:24,760 --> 00:06:26,960 Speaker 1: And then again, was there something problematic about the way 127 00:06:26,960 --> 00:06:30,520 Speaker 1: Montanto dealt with the problem? Um? I think generally when 128 00:06:30,520 --> 00:06:32,480 Speaker 1: all three of those things are loved together, the perception 129 00:06:32,560 --> 00:06:34,880 Speaker 1: is that, well, there's a tendency for people to think, well, 130 00:06:34,880 --> 00:06:37,000 Speaker 1: it all looks pretty bad, so let's just go ahead 131 00:06:37,000 --> 00:06:39,920 Speaker 1: and cut some slack to the plaintiff there was hoping. 132 00:06:40,040 --> 00:06:42,400 Speaker 1: I think that by splitting these things up, there might 133 00:06:42,440 --> 00:06:46,000 Speaker 1: be some real question about one of those questions, like, 134 00:06:46,080 --> 00:06:49,480 Speaker 1: for example, the causal relation between the plaintiff's injuries uh 135 00:06:49,520 --> 00:06:52,840 Speaker 1: and the presence of the agent in the In the roundup, Um, 136 00:06:52,960 --> 00:06:57,400 Speaker 1: that didn't work right that particular, that hope was not fulfilled. 137 00:06:57,839 --> 00:07:00,280 Speaker 1: And given that, given that the very reason that they 138 00:07:00,279 --> 00:07:02,760 Speaker 1: had for trying to get the split up turned out 139 00:07:02,800 --> 00:07:04,520 Speaker 1: not to be a very good reason at all, I 140 00:07:04,560 --> 00:07:07,120 Speaker 1: think it would be unwise for buyer to think that, well, 141 00:07:07,480 --> 00:07:09,279 Speaker 1: the fact that the verdict was a little bit lower 142 00:07:09,320 --> 00:07:11,280 Speaker 1: this time is itself the product of the you know, 143 00:07:11,320 --> 00:07:13,760 Speaker 1: sort of uh divvying up of the of the case 144 00:07:13,800 --> 00:07:17,240 Speaker 1: into distinct cases or distinct trials. So buyer is going 145 00:07:17,240 --> 00:07:20,680 Speaker 1: to appeal this verdict and appeal the verdict in August, 146 00:07:21,080 --> 00:07:23,720 Speaker 1: what are its chances on appeal besides getting the verdict 147 00:07:23,800 --> 00:07:27,680 Speaker 1: knocked down a little bit? I am myself skeptical that 148 00:07:27,720 --> 00:07:31,440 Speaker 1: there's much chance of getting those verdicts overturned or getting 149 00:07:31,480 --> 00:07:34,520 Speaker 1: those those things changed. And again, I think it's because 150 00:07:34,520 --> 00:07:36,600 Speaker 1: of the nature of the particular questions that were before 151 00:07:36,600 --> 00:07:38,840 Speaker 1: the court and the nature of the findings with respect 152 00:07:38,880 --> 00:07:42,320 Speaker 1: to those questions. There was nothing especially controversial or sort 153 00:07:42,360 --> 00:07:44,440 Speaker 1: of you know, out of the ordinary or you know, 154 00:07:44,560 --> 00:07:49,160 Speaker 1: outlier ish about those specific decisions, and it seems to 155 00:07:49,240 --> 00:07:52,320 Speaker 1: me that Buyer then ought to read those decisions as 156 00:07:52,360 --> 00:07:55,320 Speaker 1: indicating that it's really got an uphill climb if it's 157 00:07:55,320 --> 00:07:58,840 Speaker 1: going to try to decouple in people's minds the relation 158 00:07:58,960 --> 00:08:02,560 Speaker 1: between you know, the president of the alleged carcinogen and 159 00:08:02,640 --> 00:08:06,000 Speaker 1: roundup on the one hand, and people's actually acquiring cancer 160 00:08:06,240 --> 00:08:09,360 Speaker 1: or contracting cancer. On the other hand, all right, thanks Bob. 161 00:08:09,400 --> 00:08:13,720 Speaker 1: Maybe they want Buyer wants to consider Elizabeth Warren's proposal 162 00:08:13,800 --> 00:08:21,400 Speaker 1: to break up the Fireman Santo might be all right, 163 00:08:21,680 --> 00:08:25,000 Speaker 1: thanks so much. That's reliability. Okay, thank you. That's Robert Hoggett, 164 00:08:25,040 --> 00:08:29,600 Speaker 1: music professor at Cornell Law School. Thanks for listening to 165 00:08:29,600 --> 00:08:32,880 Speaker 1: the Bloomberg Law Podcast. You can subscribe and listen to 166 00:08:32,960 --> 00:08:36,720 Speaker 1: the show on Apple podcast, SoundCloud, and on Bloomberg dot 167 00:08:36,720 --> 00:08:41,240 Speaker 1: com slash podcast. I'm June Brosso. This is Bloomberg