Bayer was forced on Wednesday to delay part of a proposed settlement of allegations that its widely used weedkiller Roundup caused cancer after a U.S. judge questioned its plan to deal with future claims.
The German company said that lawyers representing those preparing a class action had withdrawn a request for court approval of the US$1.25-billion future claims scheme, part of a broader US$10.9-billion agreement to settle close to 100,000 U.S. lawsuits related to Roundup.
The move would give both sides more time to address questions raised by Federal District Court Justice Vince Chhabria of the Northern District of California who presides over the federal Roundup litigation, Bayer said.
Justice Chhabria had raised concerns over Bayer’s plan to create an independent panel of scientific experts to help assess whether glyphosate-based weedkillers such as Roundup caused cancer.
“Bayer remains strongly committed to a resolution that simultaneously addresses both the current litigation on reasonable terms and a viable solution to manage and resolve potential future litigation,” the company statement said.
Bayer said the wider agreement to settle current claims at a cost of up to US$9.6-billion was not affected by Wednesday’s decision, which only affected the agreement on future claims.
It declined to comment on the impact on the timetable for the bulk of the settlement.
“The [withdrawal] decision means that Bayer is back to square one when it comes to managing future claims, which will be worked up and filed over the coming years,” said David Noll, a law professor at Rutgers University who closely follows the litigation.
Elizabeth Cabraser, a lawyer representing the lead plaintiffs in the negotiations, said lawyers remained strongly committed to a fair and just resolution for all cases not yet included in the wider settlement.
Bayer is seeking to end legal disputes it inherited with its US$63-billion takeover of Monsanto in 2018.
On Tuesday, Bayer shares had fallen more than 6 per sent after Justice Chhabria said that the court was inclined to oppose the part of the proposed settlement that deals with future claims. The case was due to be considered again on July 24.
The shares slipped 0.7 per cent on Wednesday.
The company on Wednesday declined to say whether it would continue pursuing the idea of an outside scientific panel and said it would make adjustments to its existing plan to address Justice Chhabria’s questions.
The San Francisco-based federal judge in a filing on July 6 had questioned the idea of delegating the decision from judges and juries to a panel of scientists.
Justice Chhabria also questioned whether potential claimants would want to remain bound by a ruling reached by the proposed scientific panel if research is still continuing.
Regulators including the U.S. Environmental Protection Agency and the European Chemicals Agency, have determined glyphosate to be non-carcinogenic, supporting Bayer’s claim that the active ingredient in its Roundup product is safe for agricultural use.
However, in 2015, the World Health Organization’s cancer research arm determined the herbicide to be a “probable carcinogen,” and since 2018, three consecutive U.S. juries, who listened to scientific evidence from both sides during trials, found that Roundup causes cancer.
Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.