The U.S. Supreme Court ruled in favor of Bayer, the maker of Roundup weedkiller, in a 7-2 decision, significantly curbing thousands of state-level lawsuits alleging the product causes cancer due to a failure to warn users. The ruling, issued on Thursday, found that a U.S. law, the Federal Insecticide, Fungicide and Rodenticide Act (FIFRA), preempts state-based failure-to-warn claims, meaning states cannot impose different or additional labeling requirements when federal regulators like the EPA have approved a label without a cancer warning. This decision overturns a $1.25 million jury verdict awarded to John Durnell of Missouri, who claimed Roundup caused his non-Hodgkin lymphoma.
This judicial victory provides substantial relief to Bayer, which acquired Monsanto and its Roundup product in 2018 for $63 billion. The company has faced over 100,000 lawsuits and billions of dollars in potential liability. Bayer had previously announced a proposed $7.25 billion settlement in February to resolve many existing and future cases. Fund manager Markus Manns from Union Investment noted this ruling as a "significant milestone" for Bayer, suggesting it will make future lawsuits considerably more difficult.
While the Supreme Court's decision blocks a specific avenue for lawsuits, it does not entirely eliminate all litigation risks for Bayer. Thousands of state-level claims that are not based on "failure-to-warn" allegations may still proceed. Bayer argued that the EPA's repeated approval of Roundup labels without a cancer warning demonstrates that the product is not misbranded, and labels cannot be substantially changed without the agency's approval. The company stated the ruling "should help significantly contain the Roundup litigation after nearly a decade of legal battles" and anticipates the dismissal of current warning-based claims and a bar on future ones. However, the ruling's impact on the overall $7.25 billion settlement remains to be seen, with a federal judge recently ruling the proposed settlement will be heard in a Missouri state court. Justices Ketanji Brown Jackson and Neil Gorsuch dissented, citing that many state and federal courts had previously rejected this preemption argument.
