ST. LOUIS (CN) – The Eighth Circuit said Riceland Foods may have to give farmers’ attorneys some of the money it won from Bayer CropScience in a lawsuit over genetically modified rice.
Beginning in 2006, hundreds of rice farmers and exporters sued Bayer CropScience and Riceland Foods for contaminating the U.S. rice supply with “Liberty Link,” a genetically modified rice which had not been approved for human consumption.
Any product that includes genetically modified grain cannot be sold in the European Union, which bans genetically modified food, and whole bargeloads of rice had to be destroyed.
Most cases were consolidated into multidistrict litigation in St. Louis, and the parties settled in 2010 for $750 million, with 8 percent of the common fund reserved for attorneys’ fees.
Class counsel sued Riceland in 2013 for unjust enrichment, alleging that the rice producer refused to contribute to the common-benefit fund, despite recovering a $137 million award against Bayer in state court.
The Eighth Circuit on Friday found that the parties’ settlement did not release counsel’s claim against Riceland for its failure to contribute to the fund.
“When we look to the plain language of the Release, it is clear that the language used was not intended to protect Riceland from litigation related to its refusal to contribute to the fund,” Judge Bobby Shepherd wrote for the three-judge panel.
The settlement expressly released Riceland for claims that “arise out of, accrue on account of, or grow out of,” the presence of GMO rice in the U.S. rice supply, but the agreement did not consider claims related to Bayer’s rice litigation to “arise out” of plaintiffs’ original allegations, the appeals court concluded.
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