German Conglomerate Bayer Goes Johnson & Johnson Way To Tackle Its Cancer Related Lawsuits

Bayer AG BAYRY BAYZF is reportedly considering utilizing the Texas Two-Step bankruptcy approach to tackle the onslaught of lawsuits in the United States implicating its Roundup weedkiller causing cancer. 

With an array of recent expensive jury verdicts weighing heavily on the company, executives are strategizing with legal experts to employ this controversial tactic to halt upcoming trials and negotiate a comprehensive settlement for over 50,000 cases. 

Also Read: Bayer Holds Splitting Into Separate Units For Three Years, Focus Shifts On Tackling Challenges.

This maneuver, named after a Texas state law, entails segregating assets and liabilities into distinct units, subsequently filing the liability-loaded unit for bankruptcy to facilitate a global resolution. 

Bloomberg noted that similar attempts by companies like 3M Co MMM and Johnson & Johnson JNJ were rebuffed by courts in separate litigations.

Facing significant financial repercussions, Bayer is seeking respite following a barrage of adverse verdicts totaling around $4 billion in the past four months alone. 

While the company has secured victories in recent trials, including some substantial reductions in awarded damages, a Pennsylvania jury’s recent $2.25 billion ruling against Bayer underscores the gravity of the situation. 

A Pennsylvania jury has ordered Bayer’s Monsanto to pay over $2.2 billion to former Roundup user John McKivison, who attributed his cancer to the popular weedkiller. 

The verdict, the largest in the five-year Roundup litigation, includes $250 million for compensatory losses and $2 billion in punitive damages. McKivison, a 49-year-old landscaper, claimed prolonged exposure to Roundup led to his non-Hodgkins lymphoma diagnosis in 2020.

Citing Bruce Markell, a former federal bankruptcy judge and current law professor at Northwestern University, the Wall Street Journal report acknowledges the long odds Bayer faces with the Texas Two-Step but underscores the company’s limited alternatives. 

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo via Wikimedia Commons