The $105 million proposed settlement in a class action lawsuit over the weed killer atrazine may only be a few months away from a final fairness hearing, but attorneys involved in the case said it took more than a year of negotiating to reach this point.
St. Louis attorney Stephen Tillery, who represents the water providers that sued Syngenta Crop Protection and Syngenta AG, laid out the lengthy negotiation process during a May 30 hearing on a motion for preliminary approval of the settlement, according to a 70-page transcript of the hearing filed late last month in the federal court in Benton.
The proposed settlement stems from a class action lawsuit brought in 2010 by the city of Greenville and various water providers in six Midwestern states that claimed atrazine, a commonly used agricultural herbicide, ran off farm fields and into their drinking water supplies.
Tillery originated the litigation in 2004 by filing six separate class action suits in Madison County against manufacturers of atrazine.
During the May hearing, U.S. District Judge Phil Gilbert posed more than a dozen questions to Tillery and Michael Pope, the Chicago attorney representing the defendants. Questions ranged from complicated topics, such as the formula that will be used to compensate water providers, to ones that appeared to be joking in nature, like whether attorneys who phoned into the hearing fell asleep listening to Tillery and Pope.
Tillery said although negotiations began more than a year ago with the matter before Judge Philip Frazier, the process encountered a few speed bumps along the way.
"[D]iscussions then continued into the spring and then stopped. And then started in earnest in September and stopped in October. Started in December, continued through the winter, intermittent stops, starts, based upon where we were," Tillery told Gilbert. "It took literally months and months. And I should add that until one hour before the call to you advising that, Mr. Pope and I were still at odds over one issue."
He said that despite negotiating several class action settlements over the years, the one in the Syngenta case "was by far the most protracted, difficult one I have ever been in in my career."
After Tillery discussed the back-and-forth between him and Pope in the case that spurred millions of dollars in legal costs, Gilbert asked Tillery if "you guys have made up now?"
"Well, not really. I mean, we do," Tillery started to say, before Pope jumped in and said, "For purposes of settlement, we'll agree to that."
"I mean, we do the best we can," Tillery added. "But I'll tell you over the weekend, I'm telling you after we filed this, I mean, Mike and I spent our holiday weekend discussing this stuff and unfortunately issues that – you know, but we're professionals. We're too old not to be."
Tillery told the court that the proposed settlement would resolve all pending litigation over the claims, including matters in Madison County that include other companies besides Syngenta, such as Dow AgroSciences and Drexel.
"But it's important for the Court to understand that Syngenta has basically bought and paid for this claim on a nationwide basis," Gilbert said.
Pope, however, offered Gilbert a different term to explain the settlement.
"[W]e bought peace I think is a better way to put it, your Honor," Pope said.
The "peace" the Syngenta defendants agreed to pay for will settle claims of more than 1,800 water providers.
Tillery said the settlement, however, is "not designed to release claims that would be associated with a truck carrying atrazine driving across the country and spills and it dumps a bunch of chemical into a river system or a lake."
"That's a point source, and we have defined that using federal standards for point source contamination," Tillery explained. "In other words, this settlement is designed to encompass the anticipated, directed, and federally approved, state-approved use of this particular product."
Tillery also said the "settlement has no impact on a consumer's ability to bring any kind of other action. It only relates to these individuals, for example, a personal injury claim is not encompassed in this."
Additionally, he pointed out that "contribution claims are
not affected if, if an entity is sued over some other aspect."
Negotiations in the case, Tillery said, also included an agreement over the usage of public records and information obtained through discovery in an effort to create a combined database to identify class members.
"And since this case, since earnest, very, very time consuming lengthy meetings started taking place in the spring, early spring, we were able to secure an agreement to get as much information as possible," he said. "That's allowed us to meld databases together to allow us to go through publicly available and information from Syngenta."
That aspect of the negotiations led plaintiffs' attorneys "to identify 1,887 community water systems that have discovered atrazine in their water," Tillery said.
Under the proposed settlement discussed at the May hearing, each of these water systems would be sent notice of the settlement. Notice would also be printed in publications targeted at potential plaintiffs, such as the American Waterworks Association Magazine.
Responding to a question from Gilbert as to whether there could be more plaintiffs, Tillery said attorneys combed through information dating back to 1993 to look for plaintiffs and didn't believe so, but note that "it is conceivable" that there are more out there.
As such, he said the proposed settlement provides community water systems the chance to test their water systems for atrazine and if appropriate, file claims up until late August.
"Well, conceivably somebody learning of this settlement could be tested this summer. And they could be tested, particularly in June because of the levels of atrazine that oftentimes occur in this month," Tillery said. "And even though they have never, ever had had a atrazine detection in their history, they could avail themselves of these benefits, and even though we do not have a record of their existence."
The purpose of allowing this, he said, "was to reach out to get all of them if they wanted in. It was not to exclude anybody."
Under the proposed settlement, claimants would receive a fixed payment of $5,000 to help cover the cost of testing for atrazine (two tests per year at $250 each for 10 years) and a pro-rata share of the remaining balance of the settlement fund.
"There's no reversion; all the money is used for the class members," Tillery said. "So, in other words, depending on some of these, I'm guessing, that of 1,800-plus, some of them simply won't make a claim. They just won't ... We can't make them file one if they don't want to."
The pro-rata fund will be based on the providers that file claims, Tillery said, adding that the settlement amounts could go down "if more claims are filed that we're not aware of, water providers that we are not aware of who can prove they have sustained harm."
Each water provider's pro-rata share "will be based on an allocation score as a percentage of the total of all of the community water systems allocation scores," Tillery said.
He explained that the scores are based on the average of each claimant's' highest daily atrazine test results for the year as well as an age-weighting formula that basically increases "the allocations to claimants who have had high levels in more recent years."
Like the overall negotiation process, Tillery said coming up with this formula took some time and help from consultants and experts.
"[I}t took literally weeks of work to do this, to come up with this model that is common and very objective and where everybody can put their number in and it treats everybody correctly and fairly," he said.
Gilbert asked whether the formula also takes into account the population served by the water provider, "So like American Water would get a bigger slice of the pie than Evansville, Illinois?"
Tillery said the formula does take population served into account. He also said while a large amount of the roughly 1,900 potential class members have had very few detections of atrazine in their systems at very modest amounts, there are "157 community water systems in this group that would receive between $20,000 and $50,000" for their claims.
He also said that under the formula provided in the proposed settlement, 96 water providers would receive between $50,000 and $100,000, 151 water systems would receive between $100,000 and $500,000; 14 systems would get between $500,000 and $1 million and one system, which has had "constant problems," would receive more than $1 million.
"The allocation is fair because it ensures that every class member who submits a valid claim will receive a portion of the settlement fund while providing a proportionally larger share to those who are most affected by the presence of atrazine," Tillery said.
When asked if he had anything else to add, Pope said Tillery did a good job of summarizing the important issues, including one over continuing jurisdiction in the case once the settlement is approved.
"All I would add is that, on behalf of my client, this is a good settlement, it is a resolution of complicated litigation that still has a long way to go, so there is still a lot of expenses further that would be incurred if we did not reach settlement agreement," Pope said.
A final fairness hearing over the proposed settlement has been set for Oct. 22 in Benton. It appears that the only motion that remains pending in the case is one from the plaintiffs' attorneys seeking a court order for the payment of $1,000 from the settlement fund to the settlement administrator.