WEBVTT - Bayer Sticks With Roundup Despite Losing Second Trial

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<v Speaker 1>Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every

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<v Speaker 1>day we bring you insight and analysis into the most

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<v Speaker 1>important legal news of the day. You can find more

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<v Speaker 1>episodes of the Bloomberg Law Podcast on Apple Podcasts, SoundCloud

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<v Speaker 1>and on Bloomberg dot com slash podcasts. Buyer has lost

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<v Speaker 1>a second trial over claims that it's round Up we'd

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<v Speaker 1>killer causes cancer, and it was a big loss. The

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<v Speaker 1>jury awarded eighty point three million dollars to Edwin Hardeman,

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<v Speaker 1>who sprayed the herbicide on his property for decades and

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<v Speaker 1>said it caused his non Hodgkins lymphoma. Seventy five million

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<v Speaker 1>of that award was punitive damages. Buyer plans to appeal

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<v Speaker 1>the verdict and vowed to keep defending round Up, which

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<v Speaker 1>it says is safe, as it faces more than eleven

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<v Speaker 1>thousand lawsuits joining me as Robert Hockett, a professor at

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<v Speaker 1>Cornell Law School, Bob, what did the jury find here? Oh? So, yeah,

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<v Speaker 1>it found a couple of things. Up. Of the first,

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<v Speaker 1>there's several questions that kind of combine in a case

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<v Speaker 1>like this, right, So the first sense to do with

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<v Speaker 1>whether indeed there is a significant cancer risk associated with

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<v Speaker 1>a particular product. Right. Another thing then is um was

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<v Speaker 1>there some kind of culpability on the part of the

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<v Speaker 1>firm in sort of failing to notify people of this

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<v Speaker 1>danger or failing to look into whether there was a danger,

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<v Speaker 1>failing to rectify it in some way. And then finally

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<v Speaker 1>a third question is what is the precise relation between

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<v Speaker 1>this sort of cancer causing agent within the round up

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<v Speaker 1>we'd killer in this case on the one hand, and

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<v Speaker 1>the particular plaintiff before the court on the other hand. Right, So,

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<v Speaker 1>what the court found um uh at the first phase

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<v Speaker 1>of the trial was that there is there does indeed

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<v Speaker 1>appear to be uh this significant cancer risk that comes

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<v Speaker 1>with round up. And what remains then to be decided

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<v Speaker 1>um was well, to what degree is the company culpable

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<v Speaker 1>right for not having um you know, not having done

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<v Speaker 1>more to prevent the danger from occurring, or for not

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<v Speaker 1>having done more to sort of warn the public about it. Now,

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<v Speaker 1>that wouldn't be Buyer itself, of course, that would have

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<v Speaker 1>been Monsanto. But Buyer, as the acquirer of mon Santo

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<v Speaker 1>last June, basically succeeds mon Santo to its own its liabilities.

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<v Speaker 1>Bob Buyer says, This verdict isn't a harbinger of others,

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<v Speaker 1>because each trial has different facts and legal circumstances. But

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<v Speaker 1>both juries found that round up caused cancer, and both

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<v Speaker 1>found punitive damages based on Monsanto's past conduct. So do

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<v Speaker 1>you agree with Buyer? UM? I think it's it's I

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<v Speaker 1>can see why it wants to say what it's saying

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<v Speaker 1>right now in order effectively, I think, to sort of

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<v Speaker 1>calm fears on the part of its investors who might

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<v Speaker 1>be worried that they're more liabilities, had more losses ahead,

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<v Speaker 1>and so it's trying to make a little bit less

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<v Speaker 1>worried I think about future liabilities and losses. UM. That

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<v Speaker 1>being said, UM, I really very much hope that Buyer

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<v Speaker 1>doesn't actually believe entirely what it's been saying, because if

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<v Speaker 1>it does, then that suggests that it's going to adopt

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<v Speaker 1>the strategy that I think is actually quite risky for

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<v Speaker 1>the company. And the reason for that, in turn is that, well,

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<v Speaker 1>you know, there does seem to be a pretty strong

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<v Speaker 1>case to be made or to the effect that UM

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<v Speaker 1>the chemical agent is indeed problematic. There also seems to

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<v Speaker 1>be a pretty strong case to the effect that Monsanto

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<v Speaker 1>tried to hide this fact. And what that means is

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<v Speaker 1>that the only question remaining for buyer is the kind

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<v Speaker 1>of plaintif by plaintiff question as to whether you know

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<v Speaker 1>this plaintiff was affected, or whether there's a causal relation

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<v Speaker 1>between this plaintiff's cancer and that agent, or that plaintiffs

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<v Speaker 1>cancer and the agents and so on, and there you

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<v Speaker 1>have a total crapshoot. It really depends on who the

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<v Speaker 1>plaintiffs are. But most plankets aren't going to bring cases

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<v Speaker 1>like this. It doesn't seem to be unless they can show,

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<v Speaker 1>you know, significant exposure to that chemical agent. And these

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<v Speaker 1>are just the first two cases out of about eleven thousand,

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<v Speaker 1>two hundred. According to Bloomberg Intelligence, the settlement value of

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<v Speaker 1>all round up cases could exceed five billion dollars. When

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<v Speaker 1>does buyer begin to feel real pressure to settle these cases?

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<v Speaker 1>I think I think it really it ought to be

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<v Speaker 1>feeling that pressure now, right. It ought to be reading

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<v Speaker 1>those previous decisions, I think very carefully. The one thing

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<v Speaker 1>that it seems to be hanging its hat on, and

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<v Speaker 1>maybe there are two things that's hanging its hat on.

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<v Speaker 1>So there's another trial coming up up in San Francisco

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<v Speaker 1>and Buyer appears to believe that the judge you will

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<v Speaker 1>be hearing or presiding over that trial is himself a

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<v Speaker 1>bit more skeptical about the claims of causation between the

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<v Speaker 1>chemical agents presence on the one hand and people's developing

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<v Speaker 1>cancer on the other. So Buyer seems to be very

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<v Speaker 1>much betting on a favorable ruling from that judge is

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<v Speaker 1>a little bit more skeptical about the causal link. If

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<v Speaker 1>that judge were not to sort of demonstrate that skepticism,

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<v Speaker 1>and if Buyer were to lose there, I would think

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<v Speaker 1>that would be the finally on the coffin for them,

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<v Speaker 1>and they would probably think, you know, decide that it's

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<v Speaker 1>prudence to go ahead and settle across the board. If

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<v Speaker 1>they win, I think it's probably still a bad idea

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<v Speaker 1>not to settle, but at least they might think of

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<v Speaker 1>themselves as being in the game a bit longer now.

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<v Speaker 1>About this verdict was punitive damages, meaning to punish the

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<v Speaker 1>company for conduct. What message was that jury sending to Buyer?

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<v Speaker 1>It was sort of telling Buyer that, you know, you

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<v Speaker 1>probably you might have done better in June too, have

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<v Speaker 1>paid a little bit more attention to the perspective liability

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<v Speaker 1>of liabilities of Monsanto before you bought it. My understanding

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<v Speaker 1>is that right before the acquisition, most of the attention

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<v Speaker 1>that was paid was paid to the regulatory concerns about

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<v Speaker 1>whether right that the purchase would be permitted, and in consequence,

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<v Speaker 1>I think there might have overlooked or maybe paid insufficient

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<v Speaker 1>attention to the potential liability risk that would be coming

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<v Speaker 1>along with Monsanto, because when you acquire a company like Monsanto,

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<v Speaker 1>you do, of course acquire the bad along with the good,

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<v Speaker 1>and they don't appear to have researched the bad quite

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<v Speaker 1>as thoroughly as they might have done, maybe again, because

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<v Speaker 1>they were preoccupied with whether it would be regulatorily allowed

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<v Speaker 1>for them to purchase it at all. Hardeman's trial was

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<v Speaker 1>split into two parts. It was a format that Buyer

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<v Speaker 1>thought would give it the best chance. This verdict was

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<v Speaker 1>less than the previous verdict, which was two nine million

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<v Speaker 1>dollars and then knocked down by a judge to seventy

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<v Speaker 1>eight point six. Is that random or is that the

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<v Speaker 1>result of the two phase trial? Did it work for buyer?

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<v Speaker 1>I'm inclined to think that it was random because buyer

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<v Speaker 1>was hoping for is they were hoping that if we

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<v Speaker 1>could kind of split up the well back up for

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<v Speaker 1>one second a twilight. This basically implicates all three of

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<v Speaker 1>the questions that I mentioned from the top right. Is

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<v Speaker 1>the agent itself a cancer causing agent? Is there a

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<v Speaker 1>cause of relation between the plaintiff's use of the chemical

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<v Speaker 1>on the one hand and getting the cancer on the other,

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<v Speaker 1>And then again, was there something problematic about the way

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<v Speaker 1>Montanto dealt with the problem? Um? I think generally when

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<v Speaker 1>all three of those things are loved together, the perception

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<v Speaker 1>is that, well, there's a tendency for people to think, well,

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<v Speaker 1>it all looks pretty bad, so let's just go ahead

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<v Speaker 1>and cut some slack to the plaintiff there was hoping.

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<v Speaker 1>I think that by splitting these things up, there might

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<v Speaker 1>be some real question about one of those questions, like,

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<v Speaker 1>for example, the causal relation between the plaintiff's injuries uh

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<v Speaker 1>and the presence of the agent in the In the roundup, Um,

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<v Speaker 1>that didn't work right that particular, that hope was not fulfilled.

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<v Speaker 1>And given that, given that the very reason that they

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<v Speaker 1>had for trying to get the split up turned out

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<v Speaker 1>not to be a very good reason at all, I

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<v Speaker 1>think it would be unwise for buyer to think that, well,

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<v Speaker 1>the fact that the verdict was a little bit lower

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<v Speaker 1>this time is itself the product of the you know,

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<v Speaker 1>sort of uh divvying up of the of the case

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<v Speaker 1>into distinct cases or distinct trials. So buyer is going

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<v Speaker 1>to appeal this verdict and appeal the verdict in August,

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<v Speaker 1>what are its chances on appeal besides getting the verdict

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<v Speaker 1>knocked down a little bit? I am myself skeptical that

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<v Speaker 1>there's much chance of getting those verdicts overturned or getting

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<v Speaker 1>those those things changed. And again, I think it's because

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<v Speaker 1>of the nature of the particular questions that were before

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<v Speaker 1>the court and the nature of the findings with respect

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<v Speaker 1>to those questions. There was nothing especially controversial or sort

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<v Speaker 1>of you know, out of the ordinary or you know,

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<v Speaker 1>outlier ish about those specific decisions, and it seems to

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<v Speaker 1>me that Buyer then ought to read those decisions as

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<v Speaker 1>indicating that it's really got an uphill climb if it's

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<v Speaker 1>going to try to decouple in people's minds the relation

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<v Speaker 1>between you know, the president of the alleged carcinogen and

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<v Speaker 1>roundup on the one hand, and people's actually acquiring cancer

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<v Speaker 1>or contracting cancer. On the other hand, all right, thanks Bob.

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<v Speaker 1>Maybe they want Buyer wants to consider Elizabeth Warren's proposal

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<v Speaker 1>to break up the Fireman Santo might be all right,

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<v Speaker 1>thanks so much. That's reliability. Okay, thank you. That's Robert Hoggett,

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<v Speaker 1>music professor at Cornell Law School. Thanks for listening to

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<v Speaker 1>the Bloomberg Law Podcast. You can subscribe and listen to

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<v Speaker 1>the show on Apple podcast, SoundCloud, and on Bloomberg dot

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<v Speaker 1>com slash podcast. I'm June Brosso. This is Bloomberg