Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

In re Genetically Modified Rice Litigation

United States Court of Appeals, Eighth Circuit

August 31, 2016

In re: Genetically Modified Rice Litigation
v.
Bayer Cropscience US; Bayer CropScience LP; Bayer AG; Bayer CropScience Holding, Inc.; Bayer Corporation; Bayer BioScience NV; Bayer CropScience AG; Bayer CropScience Inc.; Bayer CropScience LLC; Bayer CropScience Holding SA, Defendants-Appellants. Riceland Foods, Inc., Plaintiff-Appellee, Don M. Downing and Adam J. Levitt, Plaintiffs' Co-Lead Counsel and Co-Trustees of the Genetically Modified Rice Common Benefit Fund, Movant-Appellee, In re: Genetically Modified Rice Litigation Riceland Foods, Inc., Plaintiff-Appellant,
v.
Bayer Cropscience US; Bayer CropScience LP; Bayer AG; Bayer CropScience Holding, Inc.; Bayer Corporation; Bayer BioScience NV; Bayer CropScience AG; Bayer CropScience Inc.; Bayer CropScience LLC; Bayer CropScience Holding SA, Defendants, Don M. Downing and Adam J. Levitt, Plaintiffs' Co-Lead Counsel and Co-Trustees of the Genetically Modified Rice Common Benefit Fund Movant-Appellee. In re: Genetically Modified Rice Litigation Riceland Foods, Inc., Plaintiff-Appellee,
v.
Bayer AG; Bayer CropScience AG; Bayer BioScience NV; Bayer CropScience LP; Bayer CropScience LLC; Bayer CropScience Holding, Inc.; Bayer CropScience Inc.; Bayer Corporation, Defendants-Appellants. In re: Genetically Modified Rice Litigation Riceland Foods, Inc., Plaintiff-Appellant,
v.
Bayer AG; Bayer CropScience AG; Bayer BioScience NV; Bayer CropScience LP; Bayer CropScience LLC; Bayer CropScience Holding, Inc.; Bayer CropScience Inc.; Bayer Corporation, Defendants-Appellees. In re: Genetically Modified Rice Litigation Riceland Foods, Inc., Plaintiff-Appellee, Don M. Downing and Adam J. Levitt, Plaintiffs' Co-Lead Counsel and Co-Trustees of the Genetically Modified Rice Common Benefit Fund, Movant-Appellant,
v.
Bayer Cropscience US; Bayer CropScience LP; Bayer AG; Bayer CropScience Holding, Inc.; Bayer Corporation; Bayer BioScience NV; Bayer CropScience AG; Bayer CropScience Inc.; Bayer CropScience LLC; Bayer CropScience Holding SA, Defendants-Appellees.

          Submitted: April 12, 2016

         Appeals from United States District Court for the Eastern District of Missouri - St. Louis

          Before COLLOTON and SHEPHERD, Circuit Judges, and BOUGH, [1] District Judge.

          COLLOTON, Circuit Judge.

         Bayer AG, along with several of its corporate subsidiaries, and Riceland, Inc., appeal an order of the district court[2] requiring Bayer to cause the deposit of a portion of a settlement between Bayer and Riceland into a common-benefit trust fund. This fund was established to compensate attorneys leading the multidistrict litigation ("MDL") concerning Bayer's LibertyLink LL601 genetically modified rice. We addressed challenges to the creation of the fund in In re Genetically Modified Rice Litigation (Rice I), 764 F.3d 864, 870-71, 873-74 (8th Cir. 2014).

         Bayer and Riceland argue that because their settlement was the product of negotiations following a state-court judgment, the district court lacked jurisdiction to order Bayer to cause a percentage of the settlement to be deposited into the fund. As the district court explained, however, Bayer and Riceland were parties to several federal cases in the consolidated federal litigation, and their settlement resolved the very claims asserted by Riceland in those federal cases. We conclude that the district court properly ordered Bayer to hold back a portion of the Bayer-Riceland settlement, and we therefore affirm the judgment.

         I.

         In 2006, Bayer reported to federal regulators that trace amounts of its experimental LL601 genetically modified rice, which was not approved for human consumption, had contaminated the commercial long-grain rice supply in the United States. In response to this disclosure, several major importers of U.S. rice-including Japan, the European Union, and Mexico-banned the import of U.S. long-grain rice or imposed stringent testing requirements. Rice commodity prices and export volume dropped precipitously following the disclosure. Although LL601 was retroactively approved for human consumption, the contamination caused significant economic loss to the domestic rice industry.

         In hundreds of individual lawsuits, approximately seven thousand rice growers ("producers") and others in the rice industry ("non-producers") sued Bayer and related entities for losses suffered as a result of the LL601 contamination. Approximately three hundred of those lawsuits, comprising the individual claims of approximately five thousand plaintiffs, were filed in or removed to federal court; the remaining plaintiffs proceeded in state court. The Judicial Panel on Multidistrict Litigation, pursuant to 28 U.S.C. § 1407, transferred the federal cases to the United States District Court for the Eastern District of Missouri for pretrial proceedings. In re LLRice 601 Contamination Litig., 466 F.Supp.2d 1351 (J.P.M.L. 2006).

         In April 2007, the district court appointed a leadership group of plaintiffs' attorneys to coordinate the centralized multidistrict proceedings. Don Downing and Adam Levitt, appellees and cross-appellants here, were named co-lead counsel for this coordinated effort. Over the course of the litigation, the leadership group took over one hundred depositions, managed extensive discovery, and conducted several bellwether trials; evidence generated from each of these efforts was made available to all plaintiffs in state and federal court. In addition, the leadership group prevailed on several motions for summary judgment. A special master determined that the leadership group and other lawyers engaged by the leadership group invested over 100, 000 hours for the common benefit of all plaintiffs.

         To compensate lawyers who would contribute to this collective effort, the district court ordered the creation of a common-benefit trust fund ("Common Benefit Order"). This order required Bayer to hold back and deposit into the fund a percentage of all recoveries in the federal litigation: eleven percent of recoveries by producer plaintiffs, ten percent of recoveries by non-producer plaintiffs, and nine percent of recoveries by European non-producer plaintiffs. The district court "reluctantly" determined that it lacked jurisdiction to apply the Common Benefit Order to "settlements and judgments related to cases pending in state courts, " even though the state-court plaintiffs would be "unjustly enriched, " because plaintiffs in those cases were not parties before the district court. As a result, the court limited the scope of its order to gross recoveries "related to each federal genetically modified rice case." In Rice I, we affirmed the district court's conclusion that it lacked jurisdiction over state-court plaintiffs, holding that an MDL judge "does not have the power to order parties in cases not before it to contribute to the Fund." 764 F.3d at 874.

         Riceland, an Arkansas rice-milling and wholesaling cooperative, was named as a defendant in over two hundred LL601-related lawsuits; in many cases, Riceland was a co-defendant with Bayer. But, in the words of Riceland's attorney, the company "quickly pivoted and was immediately at the forefront of . . . the LLRICE litigation as a plaintiff against Bayer." Riceland filed a complaint and multiple cross-claims and third-party complaints against Bayer, claiming that Bayer was negligent in failing to prevent its experimental rice from contaminating the U.S. long-grain rice supply. Riceland asserted claims against Bayer in at least seven cases that were part of the consolidated multidistrict proceedings.

         Two cases in which Riceland asserted claims against Bayer are relevant to this appeal. In Meins v. Bayer AG, No. CV-2008-108 (Ark. Cir. Ct. Arkansas Cty. filed Aug. 7, 2008), rice farmers and rice-farming entities sued Bayer and Riceland over the LL601 contamination. Riceland filed a cross-claim against Bayer in Meins; on the same day, Riceland filed an identical, original complaint against Bayer in federal court. Riceland Foods, Inc. v. Bayer AG, No. 3:09-cv-00008-BSM (E.D. Ark. filed Jan. 20, 2009), transferred, No. 4:09-cv-00433-CDP (E.D. Mo. dismissed Aug. 3, 2015).

         The plaintiffs in Meins settled their claims against Bayer, leaving only Riceland's cross-claims for trial. A jury entered a verdict in favor of Riceland and awarded the company $11.83 million in compensatory damages and $125 million in punitive damages. The trial court, applying Arkansas's statutory cap on punitive damages, reduced the punitive damages award to $1, 073, 292.

         Riceland appealed the remittitur in Meins. After Riceland filed its notice of appeal, the Arkansas Supreme Court held in a separate LL601 case that the limit on punitive damages violated the state constitution. Bayer CropScience LP v. Schafer, 385 S.W.3d 822, 829-32 (Ark. 2011). In its opening brief to the state supreme court, Riceland argued that Schafer required the court to reinstate the full punitive damage award; Bayer cross-appealed, arguing that the jury's finding that Riceland was thirty percent at fault barred the company from recovering damages. On the punitive damages issue, Bayer conceded that Schafer applied, but argued that if the verdict stood, then remand was appropriate to determine whether the $125 million award violated the state or federal constitution.

         After briefing was complete in the Meins appeal, Riceland and Bayer agreed to settle Riceland's claims. Under the settlement agreement, Bayer agreed to pay Riceland $92 million and to indemnify Riceland against any claims arising out of the LL601 litigation. In exchange, Riceland released "any and all claims . . . growing or arising out of the presence in the United States rice supply of Bayer GM Rice." The release clause stated: "This specifically includes, but is not limited to, the claims brought in the Scott Meins, et al. v. Bayer AG, et al. case." The settlement also required Riceland to dismiss with prejudice its claim in Meins, but did not specifically mention Riceland's pending federal lawsuit. ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.