Bayer's Legal Victory Against Merck: Delaware Court Rules In Company's Favor Regarding Talc Lawsuits

The Delaware Supreme Court reportedly ruled in favor of Bayer AG BAYRY BAYZF, stating that the company is not accountable for lawsuits associated with talc-based foot powder products obtained from Merck & Co Inc MRK in a $14.2 billion deal in 2014. 

Bayer is concurrently entangled in legal battles concerning the weedkiller Roundup, inherited through its $63 billion acquisition of agrochemical titan Monsanto in 2018. Despite settling most prior Roundup cases for up to $10.9 billion in 2020, the company still confronts over 40,000 pending cases. 

Recent courtroom setbacks resulted in verdicts surpassing $500 million, following a streak of nine consecutive wins.

The decision underscores that Bayer is not responsible for litigations concerning the sales of these products pre-acquisition, which encompassed Dr. Scholl's foot powder.

According to the court's unanimous ruling, supported by Justice Karen Valihura, the acquisition agreement distinctly absolved Bayer from liabilities tied to products sold before the finalized transaction. 

The ongoing lawsuits allege the presence of asbestos in talc-based items like Dr. Scholl's, linking them to cancer. Citing a Bayer representative, Reuters noted the existence of over 80 such pending lawsuits during a previous court hearing.

In April, Vice Chancellor Nathan Cook of the Delaware Chancery Court asserted that the 2014 purchase agreement explicitly held Merck responsible for claims relating to products sold before the deal's conclusion. 

Merck contended that its liability ceased on October 1, 2021, seven years post-transaction, subsequently suing Bayer when the German firm declined to assume liability. However, Cook clarified that the 2021 date pertained to distinct indemnification duties from the talc lawsuits.

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