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Bayer Aktiengesellschaft Class Action Lawsuit

Case Summary

Company Name
Bayer Aktiengesellschaft
Stock Symbol
BAYRY
Class Period
May 23, 2016 to March 19, 2019
Court
Northern District of California

The Bayer Aktiengesellschaft class action lawsuit charges Bayer and certain of its officers and members of its management board with violations of the Securities Exchange Act of 1934 and seeks to represent purchasers of Bayer American Depositary Receipts (“ADRs”) between May 23, 2016 and March 19, 2019, inclusive (the “Class Period”).  The Bayer class action lawsuit was commenced on July 15, 2020 in the Northern District of California and is captioned City of Grand Rapids General Retirement System, et al. v. Bayer Aktiengesellschaft, No. 20-cv-04737.

Bayer is a multinational pharmaceutical and life science company.  On May 23, 2016, Bayer announced that it had made an unsolicited all-cash offer to acquire Monsanto Company, a provider of agricultural chemicals and other products based in St. Louis, Missouri.  On June 7, 2018, Bayer completed its all-cash acquisition of Monsanto for $128 per share, or $63 billion, including debt.  One of Monsanto’s flagship products is Roundup, the most widely used weed killer around the world, which generated nearly $5 billion in annual revenue for Monsanto.  The active ingredient in Roundup is glyphosate, a toxic chemical long suspected of causing cancer.

Throughout the Class Period, defendants touted the acquisition as “a compelling transaction for shareholders” that would create “significant value” by generating “stronger growth, better profitability, and a more resilient business profile.”  Defendants specifically downplayed the liability risks related to Monsanto’s Roundup product, emphasizing that Bayer had conducted a “thorough analysis” during the due diligence process and “undertook appropriate due diligence of litigation and regulatory issues throughout the process,” which led Bayer to finalize the acquisition.

The Bayer class action lawsuit alleges that the above-referenced, and other similar statements, were false and misleading given that defendants knew or recklessly disregarded that the acquisition of Monsanto would not result in the benefits for Bayer that defendants had represented due to Monsanto’s significant exposure to liability risk related to its Roundup product.

On August 10, 2018, a jury in one of the first Roundup cancer lawsuits filed in state court against Monsanto, Johnson v. Monsanto Co. (San Francisco County Superior Court) (the “Johnson Case”), found unanimously that Monsanto’s glyphosate-based Roundup weed killer was a “substantial factor” in causing the plaintiff to develop non-Hodgkin’s lymphoma and that Monsanto knew, or should have known, of the risks associated with exposure to the chemical and failed to warn of this severe health hazard.  Accordingly, the jury ordered Monsanto to pay $39 million in compensatory damages and $250 million in punitive damages.  On this news, the price of Bayer ADRs declined over 11%.

On October 22, 2018, although the court in the Johnson Case reduced the award of punitive damages from $250 million to $39 million to match the compensatory damages awarded to the plaintiff, the court otherwise denied Monsanto’s motion for judgment notwithstanding the verdict and motion for a new trial and upheld the jury’s verdict, ruling that “there is no legal basis to disturb the jury’s determination that plaintiff’s exposure to [glyphosate-based herbicides] was a substantial factor in causing his [non-Hodgkin’s lymphoma].” On this news, the price of Bayer ADRs declined nearly 9%.

Then, on March 19, 2019, a jury in the Hardeman Case – the first federal Roundup cancer lawsuit to proceed to trial – issued a verdict on causation in phase one of the bifurcated trial, finding that plaintiff’s “exposure to Roundup was a substantial factor in causing his non- Hodgkin’s lymphoma.” On this news, the price of Bayer ADRs declined over 9%.

Robbins Geller Rudman & Dowd LLP is one of the world’s leading law firms representing investors in securities class action litigation.  With 200 lawyers in 9 offices, Robbins Geller has obtained many of the largest securities class action recoveries in history.  For seven consecutive years, ISS Securities Class Action Services has ranked the Firm in its annual SCAS Top 50 Report as one of the top law firms in the world in both amount recovered for shareholders and total number of class action settlements.  Robbins Geller attorneys have helped shape the securities laws and have recovered tens of billions of dollars on behalf of aggrieved victims.  Beyond securing financial recoveries for defrauded investors, Robbins Geller also specializes in implementing corporate governance reforms, helping to improve the financial markets for investors worldwide.  Robbins Geller attorneys are consistently recognized by courts, professional organizations and the media as leading lawyers in the industry.

Class Period: May 23, 2016 - March 19, 2019
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