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Roundup Settlement Delayed as Dispute Over Jurisdiction Plays Out

A proposed $7.25 billion settlement covering thousands of claims that the maker of Roundup weedkiller failed to warn people the product could cause cancer is facing delays. An attorney opposed to the settlement has filed paperwork to move the case to federal court instead of a Missouri court, where people face a June 4 deadline to opt out of the settlement.

The dispute over who should preside over the proposed settlement could disrupt its deadlines and delay a resolution about whether it should be approved. The legal wrangling over the settlement is playing out as the U.S. Supreme Court weighs a case that could block thousands of lawsuits filed in state courts against agrochemical-maker Bayer, which added Roundup to its portfolio when it acquired Missouri-based Monsanto in 2018.

Bayer contends that the state-level claims that it failed to warn of cancer risks should be forbidden because it followed federal labeling standards that don't require a warning. The company also disputes the assertion that Roundup's key ingredient, glyphosate, can cause non-Hodgkin lymphoma. However, the Environmental Protection Agency has determined that it's not likely to be carcinogenic to humans when used as directed. In contrast, the World Health Organization's International Agency for Research on Cancer classified the chemical as "probably carcinogenic" in a 2015 decision.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

The case before the Supreme Court was filed on behalf of John Durnell, who says he developed non-Hodgkin lymphoma after more than 20 years of spraying Roundup on a community garden in St. Louis. Durnell is not covered by the proposed class-action settlement. His attorney, Ashley Keller, filed objections opting out of the settlement on behalf of several other clients before also filing a document to shift the settlement case to federal court.

Claimant GroupAverage Payment
Agricultural, industrial, or turf worker, diagnosed with aggressive non-Hodgkin lymphoma at age 60 or younger$165,000
Agricultural, industrial, or turf worker, diagnosed with aggressive non-Hodgkin lymphoma at age 61-77$45,000
Agricultural, industrial, or turf worker, diagnosed with aggressive non-Hodgkin lymphoma at age 78 or older$10,000
Residential user, diagnosed with non-Hodgkin lymphoma$10,000

The proposed nationwide settlement was filed in February in St. Louis Circuit Court in Missouri. It's designed to address most pending Roundup lawsuits, as well as any additional cases brought in the coming years by people who were exposed to Roundup. However, if too many claimants opt out, Bayer reserves the right to cancel it. A hearing on the settlement is scheduled for July 9 in state court. The Supreme Court is expected to issue a decision in Durnell's case by the end of June.

Investor Takeaway

Investors should be cautious of potential delays and disruptions in the proposed $7.25 billion settlement.

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