The justices turned away a Bayer appeal and left in place a lower court decision that upheld $25 million in damages awarded to California resident Edwin Hardeman, a Roundup user who blamed his cancer on the pharmaceutical and chemical giant’s glyphosate-based products (all figures US$).

The Supreme Court’s action dealt a blow to Bayer as the company maneuvers to limit its legal liability in thousands of cases. The justices have a second Bayer petition pending on a related issue that they could act upon in the coming weeks.

Bayer’s shares were down 2.9 per cent on the news, eliminating gains over the previous two trading sessions.

U.S. President Joe Biden’s administration in May urged the court not to hear the Bayer appeal, reversing the government’s position previously taken under former President Donald Trump.

Bayer has lost three trials in which Roundup users have been awarded tens of millions of dollars in each, while also winning four trials. Bayer had pinned hopes for relief on the conservative-majority Supreme Court, which has a reputation for being pro-business.

Bayer said it “respectfully disagrees” with the court’s decision and that the company is “fully prepared to manage the litigation risk associated with potential future claims in the U.S.”

On Friday, a federal appeals court ordered the U.S. Environmental Protection Agency (EPA) to take a fresh look at whether the active ingredient glyphosate poses unreasonable risks to humans and the environment.

The San Francisco-based Ninth U.S. Circuit Court of Appeals agreed with several environmental, farm worker and food safety advocacy groups that the EPA did not adequately consider whether glyphosate causes cancer and threatens endangered species.

Bayer has asked the Supreme Court to review the verdict in Hardeman’s case, which was upheld by the Ninth Circuit in May 2021. Hardeman had regularly used Roundup for 26 years at his home in northern California before being diagnosed with a form of non-Hodgkin’s lymphoma.

Bayer said in its March annual report that it had resolved about 107,000 cases out of about 138,000 cases overall.

Bayer, which also makes aspirin, Yasmin birth-control pills and the stroke prevention drug Xarelto among other products, has argued that the cancer claims over Roundup and glyphosate go against sound science and product clearance from the EPA.

The agency has upheld guidance that glyphosate is not carcinogenic and not a risk to public health when used as indicated on the label.

Bayer has said it should not be penalized for marketing a product deemed safe by the EPA and on which the agency would not allow a cancer warning to be printed.

The lawsuits against Bayer have said the company should have warned customers of the alleged cancer risk.

Roundup-related lawsuits have dogged Bayer since it acquired the brand as part of its $63 billion purchase of agricultural seeds and pesticides maker Monsanto in 2018.

Bayer struck a settlement deal in principle with plaintiffs in June 2020 but failed to win court approval for a separate agreement on how to handle future cases.

In July 2021, Bayer took an additional litigation provision of $4.5 billion in case of an unfavourable ruling by the Supreme Court or in case the justices declined to consider its appeal.

The provision came on top of $11.6 billion it previously set aside for settlements and litigation over the matter.

Bayer plans to replace glyphosate in weedkillers for the U.S. residential market for non-professional gardeners with other active ingredients.

— Lawrence Hurley is Reuters’ U.S. Supreme Court correspondent in Washington, D.C.; additional reporting by Ludwig Burger.

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Bayer in August filed a petition with the Supreme Court to reverse a lower court decision that upheld $25 million in damages awarded to California resident Edwin Hardeman, a Roundup user who blamed his cancer on the German pharmaceutical and chemical giant’s glyphosate-based products (all figures US$).

The Supreme Court’s decision on whether to take up the matter is being closely watched as Bayer maneuvers to limit its legal liability in thousands of cases. U.S. Solicitor General Elizabeth Prelogar in the coming months is due to file a brief expressing the administration’s views.

Bayer said in a statement that it is encouraged by the court’s announcement, which often indicates the justices are interested in hearing a case.

The U.S. government “has consistently found that glyphosate-based herbicides can be used safely and are not carcinogenic, and has stated that a cancer warning would be false and misleading and misbrand the product,” Bayer’s statement said.

Bayer has lost three appeals against verdicts that sided with users of Roundup, awarding them tens of millions of dollars each. Bayer has pinned hopes for relief on the conservative-majority Supreme Court, which has a reputation for being pro-business.

Bayer asked the Supreme Court to review the verdict in Hardeman’s case, which was upheld by the San Francisco-based Ninth U.S. Circuit Court of Appeals in May. Hardeman had regularly used Roundup for 26 years at his home in northern California before being diagnosed with a form of non-Hodgkin’s lymphoma.

There are more than 25,000 related claims that Bayer has not settled yet.

Bayer, which also makes aspirin, Yasmin birth-control pills and the stroke prevention drug Xarelto among other products, has argued that the cancer claims over Roundup and its active ingredient glyphosate go against sound science and product clearance from the U.S. Environmental Protection Agency. The EPA has upheld guidance that glyphosate is not carcinogenic and not a risk to public health when used as indicated on the label.

Bayer has said it should not be penalized for marketing a product deemed safe by the EPA and on which the agency would not allow a cancer warning to be printed.

The lawsuits against Bayer have said the company should have warned customers of the alleged cancer risk. Bayer wants the Supreme Court to find that the EPA label approval under a federal law called the Federal Insecticide, Fungicide and Rodenticide Act preempts the “failure to warn” claims brought under state law.

Roundup-related lawsuits have dogged Bayer since it acquired the brand as part of its $63 billion purchase of agricultural seeds and pesticides maker Monsanto in 2018.

Bayer struck a settlement deal in principle with plaintiffs in June 2020 but failed to win court approval for a separate agreement on how to handle future cases. That settlement deal applied only to U.S. cases and not to those in Canada, where Bayer said at the time it’s “not contemplating a settlement.”

In July, Bayer took an additional litigation provision of $4.5 billion in case of an unfavourable ruling by the Supreme Court or in case the justices declined to consider its petition. This leaves “significant upside” if the Supreme Court rules in its favour, according to Bayer.

The provision came on top of $11.6 billion it previously set aside for settlements and litigation over the matter.

Bayer plans to replace glyphosate in weedkillers for the U.S. residential market for non-professional gardeners with other active ingredients.

It will continue to sell the herbicide to farmers, who rely on it heavily and whose role in the litigation has been described as negligible by Bayer.

As of late October, Bayer had reached settlements in about 98,000 cases out of about 125,000 cases overall.

A California jury last week found that Roundup did not cause a woman’s non-Hodgkin’s lymphoma.

— Reporting for Reuters by Lawrence Hurley and Ludwig Burger; additional reporting by Tom Hals.

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The court declined to hear an appeal by producers of foie gras, including the Association des Eleveurs de Canards et d’Oies du Quebec, a Canadian nonprofit that represents duck and goose farmers.

In doing so, the high court left intact a 2017 ruling by the San Francisco-based Ninth U.S. Circuit Court of Appeals upholding the law.

Animal rights groups contend that the force-feeding process is painful, gruesome and inhumane.

California enacted the law in 2004 but it did not go into effect until 2012. The Supreme Court in 2014 rejected an earlier appeal brought by producers and restaurants.

Foie gras means “fatty liver” in French. The product is produced by force-feeding corn to ducks and geese to enlarge their livers, which are harvested to make gourmet dishes.

The law specifically bans any product created by “force feeding a bird for the purpose of enlarging the bird’s liver beyond a normal size.”

— Lawrence Hurley reports on the U.S. Supreme Court for Reuters from Washington, D.C.

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The U.S. Supreme Court left in place a lower-court ruling that largely upheld the regulatory agency’s determination about the pomegranate juice maker’s advertising claims that its products fight ailments such as heart disease, prostate cancer and erectile dysfunction.

“The outcome of this case makes clear that companies like POM making serious health claims about food and nutritional supplement products must have rigorous scientific evidence to back them up,” FTC chairwoman Edith Ramirez said in a statement.

The FTC said POM could state that its juice treated or prevented disease only if the claim was backed by at least one randomized, controlled clinical trial using human subjects. Other claims of health benefits must be backed by “competent and reliable scientific evidence,” the FTC added.

POM spokesman Steven Clark said that “we continue to stand behind our efforts to publicly convey valuable information about the health benefits of POM.”

The U.S. Court of Appeals for the District of Columbia Circuit ruled last year that POM Wonderful could not advertise that its pomegranate drinks treat or prevent heart disease or other medical conditions unless it has proof, upholding the FTC’s 2010 order.

The advertisements that the FTC challenged appeared in Parade, Fitness and Prevention magazines, as well as online and on product tags, the FTC said.

“Many of those ads mischaracterized the scientific evidence concerning the health benefits of POM’s products with regard to those diseases. The FTC Act proscribes — and the First Amendment does not protect — deceptive and misleading advertisements,” the appeals court said in its ruling, referring to the U.S. Constitution’s protection of free speech.

The advertisements that most concerned the FTC were discontinued in 2005 and others were halted in 2007, POM’s lawyers said.

— Reporting for Reuters by Lawrence Hurley; additional reporting by Diane Bartz.

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The court agreed unanimously with Monsanto that Vernon Bowman, 75, had performed an end-run around the law when he used the company’s patented soybean seeds without seeking a license.

Justice Elena Kagan wrote on behalf of the court that Monsanto’s patent protections were not, in legal terminology, “exhausted” when Bowman used the seeds without the company’s permission.

Kagan wrote that patent exhaustion did not allow a farmer to reproduce patented seeds through planting and harvesting without the patent holder’s permission.

If farmers were allowed to do so, “a patent would plummet in value after the first sale of the first items containing the invention,” Kagan wrote. Such a result would lead to “less incentive for innovation than Congress wanted,” she added.

Reaffirmation

For biotech companies in various sectors, not just agriculture, the ruling was a “reaffirmation” of the principle that patent protections extend to copies made of a patented item, according to Patricia Millett, a Washington lawyer who filed a friend-of-the-court brief on behalf of the Biotechnology Industry Organization.

“It’s very important for the innovation economy,” she said.

The ruling, Millett and others in the biotech industry say, likely extends to certain other products sold with licenses, including DNA and bacterial preparations.

In the ruling, Kagan specifically stated that the decision was limited to the case before the court and not all self-replicating products. She cited computer software as an example.

“We recognize that such inventions are becoming ever more prevalent, complex and diverse,” Kagan wrote. The court, she added, did not need to address in the Monsanto case “whether or how the doctrine of patent exhaustion would apply in such circumstances.”

Christopher Holman, an intellectual property expert at the University of Missouri-Kansas City School of Law, said what the court had left undecided were instances in which there is “unavoidable or inadvertent” replication.

Notwithstanding Kagan’s reference to software, the principles contained in Monday’s ruling would apply just as much to Microsoft Corp., which sells products with licenses, as it does to Monsanto, he added.

Roundup Ready

As a result of the ruling, Bowman will have to pay Monsanto US$84,456 for infringing on the company’s patent.

Bowman’s attorney, Mark Walters, said the ruling “makes infringers out of 95 per cent of America’s soybean farmers.” Small farmers may need to “organize and lobby Congress for a clarification of the law,” he added.

David Snively, Monsanto’s executive vice-president, said in a statement that the court had ensured that “longstanding principles of patent law apply to breakthrough 21st-century technologies.”

The case arose when Bowman sought in 1999 to save money by buying commodity grain from a grain elevator. The seed was not identified as featuring Monsanto’s Roundup Ready technology, which protects seeds from herbicides.

Bowman said the patent did not cover the grain he used as seed because it was “second-generation,” not the first-generation sold by seed dealers.

Bowman kept the seed generated from the successful crop and used it the following year. He repeated the pattern until 2007.

Monsanto objected, saying Bowman was growing soybeans that were resistant to Roundup herbicide, meaning he was infringing on its patents.

— Lawrence Hurley is a Reuters correspondent covering the U.S. Supreme Court in Washington, D.C.

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