Bayer mediator dismisses report of $eight billion Roundup settlement

NEW YORK/FRANKFURT (Reuters) – Bayer AG has not supplied to pay billions of {dollars} to settle claims in the USA associated to the Roundup herbicide, mediator Ken Feinberg mentioned, dismissing a report back to that impact which drove its shares as a lot as 11% increased.

“Bayer has not proposed paying $eight billion to settle all of the U.S. Roundup most cancers claims. Such an announcement is pure fiction,” Feinberg mentioned in an e mail on Friday. “Compensation has not even been mentioned within the world mediation discussions.”

Bayer shares, which had shed a few of their features earlier than Feinberg’s assertion, retreated additional and closed up 1.7% at 64.63 euros.

Bayer, which acquired Roundup and different glyphosate-based weedkillers as a part of its $63 billion takeover of Monsanto final yr, declined touch upon the preliminary Bloomberg information report and on Feinberg’s response.

Bayer Chief Govt Werner Baumann final week mentioned the corporate would contemplate settling with U.S. plaintiffs solely on affordable phrases, and if it “achieves finality of the general litigation”.

He added on the time the group was “constructively participating” in a court-ordered course of with mediator Feinberg on the circumstances heard in federal courtroom. Many of the pending circumstances, nevertheless, have been filed with U.S. state courts.

Feinberg added that any efforts by Bayer towards a complete settlement have been tied in with the mediation proceedings overseen by him. “These are all a part of the identical mediation course of.”

Bayer shares have misplaced greater than a 3rd of their worth, or roughly 30 billion euros ($34 billion), since final August when a California jury within the first such lawsuit discovered Monsanto ought to have warned of the alleged most cancers dangers from Roundup.

HIGH EXPECTATIONS

The German medicine and pesticides firm has engaged in negotiations with plaintiffs’ legal professionals, two sources accustomed to the matter instructed Reuters.

“The issue is, how do you get the plaintiffs to climb down from their very excessive expectations? Not one of the jury verdicts to this point have been favorable for Bayer,” one of many sources mentioned, including that talks have been centered on fundamental questions corresponding to how one can deal with potential future claims.

Bayer mentioned on Friday that the following U.S. glyphosate lawsuit initially scheduled to be heard in St. Louis, Missouri, this month could be postponed to Jan. 27, 2020, and {that a} following St. Louis case slated for September had additionally been postponed.

The German firm might profit from having circumstances heard within the metropolis the place Monsanto was headquartered and the place Bayer manages its world seeds enterprise. However Missouri can be identified for juries that usually hit firms with large damages.

Bloomberg mentioned the delays had been pursued by Bayer to permit for undisturbed settlement talks.

The preliminary unfavorable courtroom rulings within the first three glyphosate circumstances, heard in California, have at occasions dragged Bayer’s market worth under what it paid for Monsanto, though the shares at the moment are buying and selling above that stage.

The corporate, which says regulators and in depth analysis have discovered glyphosate to be protected, has beforehand mentioned it was banking on U.S. appeals courts to reverse or tone down three preliminary courtroom rulings which have to this point awarded tens of hundreds of thousands of {dollars} to every plaintiff.

Bloomberg cited three sources accustomed to the discussions as saying Bayer’s legal professionals have been in search of an accord to resolve all present and future circumstances. Talks over circumstances which have but to be filed have been notably difficult, the report added.

Whereas Bayer has indicated it may pay $6-$eight billion, plaintiffs’ legal professionals need greater than $10 billion to drop their claims, the report mentioned.

An estimate of a $20 billion hit from the litigation has beforehand been mirrored within the share value, whereas a possible litigation settlement legal responsibility was within the mid single-digit billion greenback vary, Financial institution of America analysts mentioned in observe.

They saved a “impartial” ranking on the inventory, citing uncertainty over Bayer’s fortunes within the appeals course of – with the primary appeals verdict anticipated by the top of the yr – and whether or not a settlement may very well be achieved earlier than that.

The variety of U.S. plaintiffs blaming Roundup and different glyphosate-based weedkillers for most cancers had continued to rise by 5,000 to 18,400, Bayer mentioned final week.