Products Liability Law Daily $250M punitive damages award against Monsanto reduced to $10.25M
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Tuesday, July 21, 2020

$250M punitive damages award against Monsanto reduced to $10.25M

By David Yucht, J.D.

The award was reduced initially by the trial court based on due process concerns. It was further reduced on appeal to maintain a one-to-one ratio with the compensatory damages award.

A state appeals panel in California determined that there was substantial evidence supporting a liability verdict against herbicide manufacturer Monsanto Company on failure to warn and design defect claims brought by a school district grounds manager who developed cancer as a result of his exposure to herbicide-containing glyphosate. Moreover, these claims were not preempted by federal law. However, the panel significantly reduced the award of compensatory and punitive damages (Johnson v. Monsanto Co., July 20, 2020, Humes, J.).

A grounds manager for a school district in California was a heavy user of Monsanto herbicides containing glyphosate. He obtained a qualified-applicator certificate and, as part of his instruction, he learned rules and regulations about mixing herbicides, including specifically the Monsanto herbicides. He reviewed the label each time he used the product to ensure he was mixing the herbicide correctly based on the types of weeds he planned to spray. Although the label cautioned that the product was an eye irritant, it said nothing about cancer despite four studies which found evidence of its toxicity. The grounds manager sued Monsanto after contracting non-Hodgkin’s lymphoma. A jury awarded him $39.3 million in compensatory damages and $250 million in punitive damages [see Products Liability Law Daily’s August 13, 2018 analysis]. The trial court reduced the punitive damages award to $39.3 million [see Products Liability Law Daily’s October 23, 2018 analysis]. On appeal, the manufacturer argued that the grounds manager failed to prove liability, that federal law preempted the claims, and that the award of damages was excessive. The appellate court affirmed the liability verdict but modified the jury’s award.

Failure to warn. The appellate court ruled that Monsanto was liable on the failure to warn claims because the grounds manager presented substantial evidence that the product’s risks were "known or knowable." In California, a manufacturer is subject to strict liability if it is unreasonably dangerous to distribute its product without a suitable warning and the product is supplied with no warning. The manufacturer claimed that the jury incorrectly found that the potential risks of the herbicide were known. The manufacturer argued that even if some studies linked glyphosate to non-Hodgkin’s lymphoma, they did not trigger a duty to warn because they expressed only a "minority view." According to the court, although evidence was presented that some scientists criticized these studies, it was the jury’s decision as to how much weight to give this evidence.

Design defect. The appellate court also determined that Monsanto was liable on the design defect claim under the consumer-expectations test. This test allows for liability based on proof demonstrating that a product "failed to perform as safely as an ordinary consumer would expect when used in an intended or reasonably foreseeable manner." Expert testimony is not permitted in California to demonstrate "reasonable consumer expectations." Here, the grounds manager presented non-expert proof of reasonable consumer expectations when he testified that when he received safety training, he was told, "You don’t have to worry too much about [the Monsanto product]."

Causation. Additionally, the appellate court found that substantial evidence supported the jury’s causation finding. The manufacturer argued that the grounds manager failed to meet his burden to show that the herbicide was a substantial factor in bringing about his injury. Causation here needed to be proven "within a reasonable medical probability" based on expert testimony. The appellate court found that the grounds manager presented abundant evidence that the herbicide caused his cancer. Many experts testified that this herbicide could cause non-Hodgkin’s lymphoma and, in fact, caused the grounds manager’s cancer. They further testified that to a reasonable degree of medical certainty, exposure to glyphosate causes non-Hodgkin’s lymphoma. Two experts opined that the herbicide was a substantial contributing factor in the development of the grounds manager’s non-Hodgkin’s lymphoma given his heavy use of the product.

Preemption. The appellate court agreed with the trial court that federal law did not preempt this case. The panel rejected Monsanto’s argument that the grounds manager’s failure to warn claims were preempted by the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) because the causes encompassed "a more expansive warning obligation" than that required under FIFRA. The jury was instructed that it could find the manufacturer liable for failing to warn if it found that the herbicide had "potential risks that were known or knowable" at the time of its manufacture, distribution, or sale, and that such risks presented "a substantial danger to persons using" the product. In its argument, the manufacturer omitted the "substantial danger" portion of the instruction and contended that the jury was instructed that it could find the company liable if it found that the herbicide had only "potential risks." It then argued that this inaccurate version of the law created a more expansive warning obligation than what FIFRA required. Monsanto also incorrectly referred to a section of FIFRA dealing with general risks to the environment rather than specific risks to humans. The court recognized that herbicide manufacturers are required to obtain the Environmental Protection Agency’s (EPA) approval before changing labels for their products, and that the EPA had repeatedly approved the labels involved in this case. However, the existence of EPA requirements and actions are not enough, standing alone, to preempt state failure to warn claims. The EPA’s registration of herbicides does not have the force of law to preempt state failure to warn claims when those claims are consistent with FIFRA.

Noneconomic compensatory damages. The panel reduced a portion of the compensatory damages award. The jury awarded approximately $39.3 million in compensatory damages, and $250 million in punitive damages. The trial court reduced the punitive damages award to $39.3 million on due process grounds. The panel agreed with the manufacturer’s argument that the $33 million portion of compensatory damages relating to future noneconomic damages was not supported by the evidence of the grounds manager’s life expectancy. The jury was instructed that to recover for "future pain, mental suffering, loss of enjoyment of life, disfigurement, physical impairment, inconvenience, grief, anxiety, humiliation and emotional distress, the grounds manager had to prove that he was reasonably certain to suffer that harm." Jurors were further instructed that if they decided he had suffered damages that will continue for the rest of his life, they needed to "determine how long he will probably live." Generally, a 46-year-old male is expected to live another 33 years. Damages for pain and suffering, however, are based upon life expectancy in the individual’s injured condition. The grounds manager’s attorney argued that he would not live another two years "absent a miracle." Consequently, he was entitled to future noneconomic damages measured by a life expectancy that was realistic. The evidence supported an award of $1 million per year. The panel concluded that $4 million was an appropriate award. The jury’s total noneconomic damages award was remitted to $8 million ($4 million in past noneconomic loss, plus $4 million in future noneconomic loss), plus the other compensatory damages awarded, resulting in a total reduced award of about $10,250,000.

Punitive damages. Concerning punitive damages, the appellate court concluded that sufficient evidence supported punitive damages but that the amount should be reduced to correspond with the reduction of future noneconomic damages. Although the jury could have accepted the manufacturer’s characterization of its conduct as simply demonstrating advocacy for a "well-supported belief that its products were safe," the jury was not required to do so. Substantial evidence was presented from which the jury could infer that the manufacturer acted with a conscious disregard for public safety by discounting legitimate questions surrounding glyphosate’s genotoxic effect and failing to conduct adequate studies. The trial court had concluded that since there was a punitive element to the compensatory damages award, the law supported a one-to-one ratio for punitive damages. The appellate panel found that the trial court did not err when it set the one-to-one limit in this case. Because the panel agreed with this ratio and had reduced the compensatory award, it reduced the punitive award to $10,250,000 to maintain the one-to-one ratio with the compensatory damages.

The case is Nos. A155940 & A156706.

Attorneys: Brent Wisner (Baum, Hedlund, Aristei & Goldman, PC) for Dewayne Johnson. Fred J. Hiestand (Kendall Brill & Kelly LLP) for Monsanto Co.

Companies: Monsanto Co.

MainStory: TopStory DamagesNews CausationNews PreemptionNews WarningsNews DesignManufacturingNews EvidentiaryNews JuryVerdictsNewsStory ChemicalNews CaliforniaNews

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