St. Louis, MO, Dec. 5--Alabama residents who settled with Solutia Inc. and the old Monsanto Co. in 2001 over polychlorinated biphenyl, or PCB, claims aren't owed any more money for several reasons, the companies claim.
In a response filed Wednesday in U.S. District Court in Birmingham, AL, Solutia and the portion of Monsanto that Pharmacia Corp. purchased in March 2000 said a settlement reached with plaintiffs in the Abernathy v. Monsanto and Tolbert v. Monsanto lawsuits in August didn't trigger a "Most Favored Nation" provision in the 2001 settlement with plaintiffs in the Owens v. Monsanto lawsuit.
That provision guaranteed that the Owens' plaintiffs wouldn't receive any less money per plaintiff than the plaintiffs in other "qualifying cases," according to a filing made on Oct. 27 by the attorneys for the Owens' plaintiffs. The 1,600 plaintiffs in Owens claim that they are owed more than the $40 million that the parties agreed to in a settlement on April 26, 2001.
Ralph I. Knowles Jr., of Atlanta, a lead attorney for the Owens' plaintiffs, couldn't be reached for comment.
The plaintiffs in all three lawsuits claimed they were harmed by PCB exposure from a plant in Anniston, AL, that was originally owned by Monsanto but later owned by Solutia after Solutia was spun off from Monsanto in September 1997.
Attorneys for the 3,500 plaintiffs in Abernathy and for the 15,300 plaintiffs in Tolbert announced on Aug. 20 that they had reached a $600 million cash settlement with Solutia, the current Monsanto Co., Pfizer Inc.'s Pharmacia unit and the companies' commercial insurers. Each case was settled for $300 million.
In those two cases, the plaintiffs sued Solutia, the Pharmacia that Pfizer bought earlier this year and the Monsanto that existed before it merged with what was Pharmacia & Upjohn Inc. in March 2000 to form Pharmacia. Pharmacia sold 15% of its stake in the current Monsanto in October 2000 and its remaining stake in August 2002.
In their filing on Wednesday, Solutia and the old Monsanto argued that the attorneys in the Owens lawsuit used an incorrect settlement amount to determine whether the "Most Favored Nation" clause was triggered by the August settlement.
Instead of using $600 million as the settlement amount, the correct figure is $350 million, once four "adjustments" are made in accordance with provisions in the August agreement, the companies claim.
Those "adjustments" include subtracting $25 million for the operation of a healthcare clinic in Anniston.
The amount paid to each Owens plaintiff under that settlement was also reduced by the "several different funds or other payments" that were spelled out in the 2001 agreement, Solutia and the old Monsanto said in their filing.
Once all the four adjustments are made, the "per capita gross recovery" under the August settlement is $16,666.67, the companies claim. Because that's less than the $20,676.69 "per capita gross cash recovery" in the Owens lawsuit, the "Most Favored Nation" clause in the Owens settlement isn't triggered. That is why the Owens' plaintiffs aren't owed more money, Solutia and Monsanto said.
Solutia and old Monsanto also argued in the filing that the only way the August settlement couldn't be a "global" one, as described by the judges who approved the settlement, is on the basis that the judges acted fraudulently. The Owens' plaintiffs don't make that claim, the companies said.
Both sides are waiting for a hearing date from the judge in the matter, Solutia spokesman Glenn Ruskin told Dow Jones Newswires.
