May 8th, 2019
Bayer CEO Under Fire Over Roundup Litigation
A few weeks ago, Bayer shareholders delivered an unprecedented rebuke of Bayer’s management over Bayer’s $63 billion acquisition of Monsanto last year, expressing serious concern caused by management’s overconfidence in Bayer’s handling of lawsuits over Monsanto’s Roundup weed killer. The litigation against Monsanto was absorbed by Bayer as part of Bayer’s acquisition of Monsanto.
The International Agency for Research on Cancer (IARC) an agency of the World Health Organization (WHO,) issued a report in early 2015 that said the pesticide, which is Roundup’s active ingredient, glyphosate, was “probably carcinogenic to humans.” A second report from the WHO and United Nations later clarified that glyphosate was “unlikely to pose a carcinogenic risk to humans from exposure through the diet.” However, eating Roundup residue is one thing but spraying glyphosate over many years is another and the early litigation on Roundup has involved plaintiffs who were heavily involved in the spraying of Roundup.
Last month, a jury rendered an $81 million damages verdict to a man who claims the Roundup weed killer caused his cancer. In a similar ruling last year, a separate jury assessed damages to a cancer victim from Roundup at $289 million, reduced to $78 million on appeal. Since that first verdict, Bayer’s shares have lost 40% of their value. And Bayer AG’s chief executive officer on Friday said the company currently faces 13,400 Roundup suits as he defended the Monsanto acquisition to shareholders.
According to one corporate law expert, Bayer’s Chief Executive Officer has nine months to prove he shouldn’t be kicked out as a result of last year’s Monsanto acquisition, the time when Bayer sets the agenda for its next annual general meeting, after which dissident shareholders can file counter motions against management.