Bayer stock surges 20% on Supreme Court Roundup ruling

Investing.com -- Bayer AG (ETR:BAYN) shares surged 17% Thursday following a U.S. Supreme Court ruling that shields the company from tens of thousands of lawsuits claiming its Roundup herbicide should have carried a cancer warning label.

The Supreme Court voted 7-2 to throw out a $1.25 million jury verdict won by a Missouri man who blamed Roundup for his non-Hodgkin lymphoma. The majority ruled that consumers cannot sue Bayer for the absence of a cancer warning given that federal regulators concluded a cautionary statement was not necessary.

The decision will help end a decade-long flood of litigation that has cost Bayer more than $10 billion. Bayer stock rose as much as 17% in Frankfurt in early trading, marking the biggest intraday gain since March 2003, before trading was halted for volatility.

Justice Brett Kavanaugh wrote for the majority that federal law demands uniform pesticide labels and that the state law failure-to-warn claim at issue would require a cancer warning on Roundup’s label, which would be in addition to and different from the label required by the Environmental Protection Agency.

Bayer said in a statement that the decision is good for science, farmers, and industries that depend on regulatory clarity for innovation. The company added that the ruling should help significantly contain the Roundup litigation after nearly a decade of legal battles and should result in the dismissal of current warning-based claims and bar future failure-to-warn claims.

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