(Bloomberg) -- Bayer AG agreed to pay $160 million to resolve a claim by the city of Seattle that the company’s Monsanto unit fouled the municipal storm-water-drainage system and a local river with banned chemicals in what the city says is the largest single settlement in the years-long litigation over the pollution claims.
Monsanto was accused by the city of creating a public nuisance by manufacturing and marketing polychlorinated biphenyls, or PCBs, that contaminated the Duwamish River and drainage lines. The settlement, which Seattle announced Thursday, avoids a trial of the city’s lawsuit that was set to start in September in federal court in Seattle. Monsanto said in its court filings that the city sought more than $700 million in damages tied to the PCB contamination.
Bayer didn’t admit to any wrongdoing as part of the settlement. In a statement, the company said it never made “PCBs in the Seattle area, discontinued its own legal production of PCBs nearly five decades ago, conducted hundreds of studies on PCB safety” and provided warnings to its customers. Bayer said it will provide $35 million for contamination cleanup and $125 million for reimbursements to cover fallout from the pollution. The $125 million will cover the city’s contribution to a Superfund cleanup of the river over its own pollution of it.
The accord comes as Bayer battles to overturn a series of court losses tied to a Seattle-area school, where teachers and students say they were exposed to PCBs that leaked out of overhead lights. A Washington state appeals court in May threw out a $185 million verdict won by three ex-teachers who said they suffered brain injuries.
Monsanto, primarily a manufacturer of seeds and herbicides, also made PCBs, which were banned in the US in 1979 after researchers found they posed health risks. Bayer’s top-end exposure in PCB contamination claims from US states and cities could exceed $2.5 billion, according to Bloomberg Intelligence. The company has already paid almost $650 million to resolve cases over polluted waterways. Seattle opted out of that accord, which covered 2,500 states and municipalities.
Bayer announced Thursday that it hired veteran plaintiffs’ lawyer Mark Lanier to spearhead its effort to force ex-customers such as General Electric, Paramount Global and razor-maker Gillette to indemnify Monsanto for payouts tied to the PCB pollution. The customers agreed to such payments as part of sale contracts for building products that contained the substances, Bayer said in a statement. Lanier is best-known for winning a nearly $4.7 billion verdict against Johnson & Johnson in a lawsuit alleging its baby powder caused cancer.
The case is Seattle v. Monsanto, 2:16-cv-00107, US District Court for Western District of Washington (Seattle).
(Updates with amount of damages sought in second paragraph)
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