By Brendan Pierson
(Reuters) -A U.S. appeals court on Monday refused to dismiss a Georgia doctor's lawsuit claiming that Bayer AG (ETR:BAYGN)'s Roundup weedkiller caused cancer, the latest setback in the German company's efforts to fend off thousands of similar cases carrying potentially billions of dollars in liability.
A three-judge panel of the Atlanta-based 11th U.S. Circuit Court of Appeals rejected Bayer (OTC:BAYRY)'s argument that federal regulators' approval of Roundup shielded the company from being sued under state law for failing to warn consumers of the product's risks. Several other appeals courts had previously reached the same conclusion in similar lawsuits.
Bayer said in a statement that it disagreed with the ruling and that it "continues to stand fully behind its Roundup products," which it maintains are safe.
The ruling comes as some investors have been pressuring the company to change its strategy on the litigation, by pursuing settlements or breaking up its business. So far, however, the company has doubled down on continuing to fight Roundup cases in court, saying it believes it can win key victories on appeal.
If the 11th Circuit had broken with those other appeals courts, it would have made it more likely for the U.S. Supreme Court to take up the issue. Another federal appeals court, the Philadelphia-based 3rd Circuit, is currently considering the issue in a separate case.
Bayer has said that it hopes a favorable Supreme Court ruling could eliminate much of its liability from the Roundup-related litigation, but the court has so far rebuffed its appeals.
Roundup-related lawsuits have dogged Bayer since it acquired the brand as part of its $63 billion purchase of Monsanto (NYSE:MON) in 2018. The company settled most Roundup claims that were pending against it in 2020 for up to $10.9 billion, but still faces more than 50,000 claims over the product.
David Carson, the plaintiff in Monday's case, said in his lawsuit he was diagnosed with a type of cancer called malignant fibrous histiocytoma in 2016 after using Roundup for 30 years.
Much of his case was initially dismissed by a trial judge, who agreed with Bayer that his failure-to-warn claims were barred by federal law.
The 11th Circuit panel in July 2022 disagreed and revived the case. Monday's ruling comes after the panel was ordered by the full 11th Circuit to reconsider its earlier decision.
The panel said that a Georgia law that requires companies to warn consumers of foreseeable dangers from using their products does not conflict with the Federal Insecticide, Fungicide, and Rodenticide Act, the federal law under which Roundup's label was approved.
The court said it would have been possible for the company to seek to put a cancer warning on Roundup to comply with Georgia law.
"We're gratified the court rejected Monsanto's defense and upheld the validity of Dr. Carson's claims," David Frederick, Carson's attorney, said in an email. "The harm Monsanto caused with Roundup is immeasurable."
Bayer has won 10 of the last 16 trials over Roundup. But it has been hit in the cases it lost with more than $4 billion in jury verdicts since last October. Some of those awards are likely to be reduced on appeal because they exceed U.S. Supreme Court guidance.
Most plaintiffs allege that Roundup caused a type of cancer called non-Hodgkin's lymphoma, though some like Carson say it caused other cancers.