After five years of hard-fought litigation, Bayer Corporation has agreed to a settlement of $750 million to resolve claims by U. S. farmers who were damaged when Bayer allowed unapproved genetically-modified rice to infiltrate U.S. rice. The settlement program is open to all long-grain rice farmers and landowners who planted rice in any year from 2006 through 2010 regardless of whether they filed a lawsuit.
In August 2006, the U.S. Department of Agriculture announced that genetically-modified Liberty Link rice had been found in U.S. long-grain rice, specifically Clearfield 131 and Cheniere varieties. At that time, U.S. farmers were in the midst of harvesting their 2006 long grain rice crop. The price of long grain rice fell sharply. The price of rice futures fell 14%. American farmers suffered significant market losses. The European Union, Japan, and other Asian markets refused to buy U.S. rice for fear it contained genetically-modified rice.
Approximately 11,000 farmers and landowners from Arkansas, Louisiana, Mississippi, Missouri, and Texas filed suit in federal or state courts to recover damages suffered as a result of the market loss and related costs of cleaning up contaminated rice. Cases filed in federal court were consolidated in St. Louis before Judge Catherine Perry, United States District Judge for the Eastern District of Missouri. Most state court cases were filed in state court in Arkansas. Juries in six cases in federal and state courts awarded farmers more than $54 million in compensatory and punitive damages. Other cases filed by farmers and/or landowners were settled before or during trial.
The settlement provides for compensation for market losses, losses for those farmers who planted Clearfield 131 or Cheniere rice, and for other losses. Farmers and landowners are compensated for market losses based on the number of acres planted for crop years 2006, 2007, 2008, 2009, and 2010. The payment per acre is a maximum of $120 per acre for 2006, $80 per acre for 2007, $60 per acre for 2008, $40 per acre for 2009, and $10 per acre for 2010. Farmers and landowners who planted Clearfield 131 and/or Cheniere in 2006 will be compensated at $100 per acre planted. For farmers and landowner who had other losses, a fund is available under the settlement for compensation. Claimants will be required to provide extensive documentation.
In order for the settlement program to be activated and for Bayer to be required to fund the settlement, the settlement agreement requires that farmers and/or landowners with an interest in 85% of the average acres planted during crop years 2006, 2007, 2008, and 2009 participate in the settlement. If this threshold participation percentage is not met, Bayer will have the right to walk away from the settlement. The settlement enrollment process has already begun. Farmers or landowners who did not file a lawsuit may still make a claim under the settlement. The enrollment deadline is October 10, 2011.
In addition to the lawsuits brought by farmers and landowners, Bayer Corporation also faces lawsuits filed by large farm cooperatives, Riceland Foods and Producers Rice Mill. A jury in Stuttgart, Ark., awarded Riceland Foods $136.8 million in compensatory damages in March of this year, finding that Bayer acted negligently in its handling of genetically-modified rice. That verdict remains on appeal. Lawsuits filed by non-farmers and landowners are not a part of the settlement.
Don Downing, a St. Louis lawyer, and Adam Levitt, a Chicago lawyer, serve as co-lead counsel for the Plaintiffs in the federal litigation. Scott Powell of Hare, Wynn, Newell & Newton in Birmingham represents a number of clients in the settlement. Leigh O’Dell, a lawyer in our firm’s Mass Torts Section, also represents clients. All of these lawyers have done an excellent job for their clients in this most interesting litigation.
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.