By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She is currently writing a book about textile artisans.
Alameda County Superior Court Judge Winifred Smith on Thursday slashed a punitive damages award from $2.055 billion to $87 million in a lawsuit that concluded Monsanto’s Roundup herbicide caused cancer. This is the second time this month and the third time overall that a judge has reduced a jury’s punitive damages award in a glyphosate lawsuit.
The moves to reducing damages are not unexpected – as I previously discussed (see Glyphosate Use Surges in Midwest, Lawsuits Mount: What Will the Supremes Say?). And the punitive damages awarded originally in this case were for the eye-popping amount of $2 billion. A series of precedents over the last couple of decades has drastically circumscribed overall punitive damages awards on constitutional grounds, and now largely limits them to single-digit multipliers of economic damages (see, e.g., State Farm Mut. Automobile Ins. Co. v. Campbell (2003)).
The seemingly arcane area is just one in which judges have handed down business-friendly decisions. Other areas include: limitations on class actions, upholding mandatory arbitration clauses; and narrowing grounds for personal jurisdiction to sue an out-of-state corporation in a court in the plaintiff’s home state. Taken together, these legal decisions increase the formidable obstacles ordinary people face in getting one’s day in court – let alone prevailing in a lawsuit. The increased pro-corporate bias of the judicial system in turn reduces accountability and the pressures on corporations to do the right thing, else they might lose a lawsuit and payout a substantial judgment.
I should mention that this pro-business legal shift is a bipartisan affair: it’s not simply Republican nominees who comprise the majorities that make these decisions (up to and including the United States Supreme Court). Democrat appointees also support and affirm these judgements.
Alas, when Democrats are in charge of judicial appointments, many mainstream Democrats privilege a prospective jurist’s likely stances towards abortion rights and voting rights, and don’t focus on where s/he is likely to rule on issues of corporate accountability. Additionally, credentialism is rampant, with not enough attention paid to what roles a judicial candidate has played in the legal system (see my earlier musings on this topic, Doing Time: Prison, Law Schools, and the Membership of the US Supreme Court and Barriers to Entry: On Bar Exams and Supreme Court Seats). So we get benches largely made up of academics, corporate lawyers, and former prosecutors, and see far fewer public defenders, public interest lawyers, or plaintiffs’ attorneys chosen as judges.
Roundup Ruling: Victory for Plaintiffs
Yet despite slashing the amounts of damages, the latest case represents a solid win for plaintiffs. And the damages awarded, a mix of compensatory and punitive damages, remain substantial: $86.7 million. (Although I must mention, the appeals process is far from exhausted, and it’s far too early to assess how these lawsuits will play out – and how much money Bayer will ultimately fork out.)
Let’s nonetheless focus here on the victory at hand. As the San Francisco Chronicle reports in Alameda County judge reduces $2 billion jury award in Monsanto case to $86.7 million:
Evidence at the Oakland trial, though disputed, supports the jury’s conclusion that Roundup was “a substantial factor” in causing non-Hodgkin’s lymphoma in both Alva and Alberta Pilliod, said Superior Court Judge Winifred Smith. She said the evidence also supported the jury’s finding that Monsanto had known the herbicide’s active ingredient, glyphosate, could be dangerous while the Pilliods were still using it and had failed to warn them.
Further, Smith said, there was clear evidence that Monsanto, after learning of the dangers, “made efforts to impede, discourage or distort scientific inquiry” by regulators who approved its use, “reprehensible” conduct that justifies punitive damages.
The plaintiffs were well aware that the jury’s damages award would be cut. According to the LA Times in Judge reduces $2-billion award in Monsanto Roundup cancer case to $87 million:
The couple had anticipated the reduction, and their lawyer said the overall ruling was “a major victory.”
Although “the reduction in damages does not fairly capture the pain and suffering experienced by Alva and Alberta,” attorney Brent Wisner said in a statement, “the judge rejected every argument Monsanto raised and sustained a very substantial verdict.”
The judge dismissed Monsanto’s motion for a JNOV (judgement notwithstanding verdict) – whereby the presiding judge in a civil jury trial in a US court may overrule the decision of a jury and reverse or amend their verdict. But Judge Smith granted Monsanto’s motion for a new trial – unless the plaintiffs agree to accept the reduced $87 million damages award.
Bayer – which assumed Roundup legal liabilities when it acquired US manufacturer Monsanto last year – is faced with more than 13,000 pending glyphosate actions. The company has lost three cases far in California courts – all in the Bay Area – and won zero. According to the San Francisco Chronicle:
A San Francisco Superior Court jury awarded $289 million last August to former school groundskeeper Dewayne “Lee” Johnson of Vallejo, who doctors say may have less than a year to live. A judge later reduced the award to $78.5 million. In March, a federal court jury in San Francisco awarded more than $80 million to Edwin Hardeman of Sonoma County, whose cancer is in remission. A judge has reduced that award to $25.2 million.
As Deutche Welle reports in US judge reduces $2 billion Monsanto Roundup verdict against Bayer, the legal verdicts have “[pounded] its share price and [left] the entire company with a stock market capitalization less than the $63 billion it paid for Monsanto in a takeover completed last year.”
Bayer continues to affirm – at least in its public statements – that its legal strategy will be upheld on appeal.
As the FT reports in US judge slashes $2bn verdict against Bayer in Roundup case:
In a statement, Bayer said it welcomed the judge’s decision as a “step in the right direction”, but that it would still file an appeal to have the entire verdict overturned. The German group has insisted all along that glyphosate-based pesticides are safe for use.
“The court’s decision to reduce the punitive, non-economic, and future medical damage awards is a step in the right direction, but we continue to believe that the verdict and damage awards are not supported by the evidence at trial and conflict with the extensive body of reliable science and conclusions of leading health regulators worldwide,” Bayer said.
However these glyphosate lawsuits ultimately play out, I think it’s difficult to dispute the conclusion that the company seriously underestimated the risks of acquiring Monsanto (see this Der Spiegel take, Safe Or Not, Roundup Is Toxic for Bayer – written in January, before the latest legal setbacks).
The next challenge Bayer faces is its first glyphosate lawsuit to be tried outside California. As Reuters reports in In Roundup case, U.S. judge cuts $2 billion verdict against Bayer to $86 million:
In August, the company is scheduled to face its first trial outside California at a courthouse in St. Louis, Missouri. Monsanto has recruited Missouri-based expert witnesses to make its case in a place where it has century-old roots but where juries often hit companies with huge damages.
I really don’t see that a Missouri jury is less likely to decide against plaintiffs than a California one. After all, even red Southern states have active and successful plaintiffs’ bars – IIRC, Florida, Mississippi, and Texas litigators we’re key players in the litigation that led to the 1998 tobacco Master Settlement Agreement.