Bayer Increases Roundup Lawsuit Settlement Reserves By $4.5 Billion

Days after the U.S. District Judge presiding over all federal Roundup lawsuits required that plaintiffs diagnosed with non-Hodgkins lymphoma participate in a new process to obtain a settlement offer to resolve their case, Bayer has announced it is setting aside an additional $4.5 billion in reserves to cover costs associated with the litigation.

Bayer and its Monsanto unit have faced more than 120,000 non-Hodgkins lymphoma (NHL) cases brought by former users of the controversial glyphosate-based weed killer, each raising similar allegations that information has been withheld from consumers about the risks associated with glyphosate exposure from Roundup.

Last year, Bayer announced a massive Roundup settlement, which would involve payments of more than $11.6 billion to resolve previously filed claims against Monsanto. However, in addition to settling cases already filed by former users diagnosed with non-Hodgkins lymphoma, the company proposed a class action settlement that set aside about $2 billion to resolve future claims that may arise over the next four years.

The proposed settlement of future cases faced sharp criticism at the time, as former users of Roundup who have not yet been diagnosed with cancer, would not have a fair opportunity to opt out of the program. Under terms of that previously proposed deal, those individuals would have lost important rights, including a requirement they wait four years to pursue any future lawsuits over the deadly cancer, and give up the ability to pursue punitive damages, which have resulted in a number of massive verdicts against Monsanto.

U.S. District Judge Vince Chhabria, who is overseeing the federal litigation, rejected that settlement plan in May, saying it would allow Bayer to treat future claimants who have not yet developed non-Hodgkins lymphoma after glyphosate exposure unfairly. The court noted non-Hodgkins lymphoma has a latency period of 10 to 15 years, but the agreement only provided a four-year window to file.

As new cases continue to be filed by individuals diagnosed with NHL, and thousands of lawsuits remain unsettled, Judge Chhabria issued an order last week requiring every current and future plaintiff with a case in the federal court system who has not already reached a settlement with Bayer to participate in a mediation program with Special Master Ken Feinberg, who has established a program that allows each plaintiff to obtain an offer to settle their Roundup NHL case.

Plaintiffs are not required to accepted the settlement, and Judge Chhabria is pushing forward with plans to prepare several large waves of cases for trial while the mediation program moves forward.

On Thursday, Bayer officials announced they are adding another $4.5 billion in reserves to cover the costs of the Roundup litigation and settlements that are continuing to be negotiated.

The company also announced the same day that it plans to remove the active ingredient glyphosate from Roundup weed killers sold to U.S. residential customers by 2023. The products would still be sold under the Roundup label, but would use a different active ingredient, which has not been linked to a risk of non-Hodgkins lymphoma. However, glyphosate would still be used in products sold to agricultural businesses and farmers, and in product sold in other parts of the world, Bayer officials said.

While the move may eventually limit the filing of new non-Hodgkins lymphoma lawsuits against Bayer and it’s Monsanto subsidiary for failing to warn about the risks associated with glyphosate, the companies will still face years of future litigation and thousands of additional lawsuits brought as long-time users continue to develop non-Hodgkins lymphoma after exposure to the product during the decades it has been on the market without any cancer warnings.

Bayer has noted the vast majority of Roundup cancer claims have come from U.S. residential users, and the additional set aside will raise the total cost of the litigation to more than $16 billion.