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Bader Farms, Inc. v. Monsanto Co.

United States District Court, E.D. Missouri, Southeastern Division

July 10, 2019

BADER FARMS, INC. and BILL BADER Plaintiffs,
v.
MONSANTO CO. and BASF CORP., Defendants.

          MEMORANDUM AND ORDER

          STEPHEN N. LIMBAUGH, JR. UNITED STATES DISTRICT JUDGE.

         This matter is before the Court on defendants' motions to dismiss plaintiffs' Third Amended Complaint (“TAC”) (#174, #177). The Bader plaintiffs claim their peach orchard was destroyed beginning in 2015 after defendants Monsanto Company (a company that sells crop seed and herbicide) and BASF Corporation (a company that sells herbicide) conspired to develop and market dicamba-tolerant seeds and dicamba-based herbicides. Plaintiffs claim both defendants conspired to create an “ecological disaster, ” where Monsanto released its dicamba-tolerant seed in 2015 and 2016 with no corresponding dicamba herbicide. As a result, farmers illegally sprayed an old formulation of dicamba herbicide that was unapproved for in-crop, over-the-top, use and was “volatile, ” or prone to drift. Drifting dicamba would cause damage to neighboring, non-tolerant crops, forcing neighboring farmers to plant Monsanto's dicamba-tolerant seed defensively, and that increased demand for both defendants' new dicamba herbicide during the 2017 growing season.

         Numerous lawsuits have been filed against defendants based on these circumstances, and the cases filed in federal court have been consolidated into the In re Dicamba Herbicides Multi-District Litigation, 1:18-MD-2820-SNLJ (E.D. Mo.) (the “MDL”). The present case was filed on November 23, 2016. Plaintiffs have amended their complaint three times now, most recently after this Court's ruling on the defendants' motions to dismiss the Master Crop Damage Complaint filed in the MDL. That Master Crop Damage complaint focuses on soybean growers in several states. The Bader plaintiffs, although part of the MDL, did not join in the Master Crop Damage Complaint; the Bader case is following its own Case Management Order and is set for trial in January 2020.

         This memorandum presumes familiarity with the facts and this Court's earlier memoranda addressing, e.g., the Second Amended Complaint. See Bader Farms, Inc. v. Monsanto Co., 1:16-CV-299-SNLJ, 2018 WL 1784394 (E.D. Mo. Apr. 13, 2018). The TAC (1) added allegations that their peach orchard suffered further dicamba damage in 2018, rendering their peach operation no longer biologically or financially sustainable; (2) removed the claims for trespass and fraudulent concealment and added claims under Missouri Crop Protection Statutes; (3) added allegations pertaining to defendants' joint venture and pleaded joint venture liability as to each claim; and (4) added allegations to clarify that plaintiffs pursue their conspiracy claims under the Restatement (Second) of Torts § 876(a) and (b).

         Defendant Monsanto moves to dismiss claims for failure to warn (Counts II and IV), negligent training (Count V), violation of the Missouri Crop Protection Act (Counts VI and VII), civil conspiracy (Counts VIII and IX), and joint liability for punitive damages (as reflected in Counts X and XI). Defendant BASF moves to dismiss those same counts except the claims for failure to warn.

         I. Legal Standard

         A Rule 12(b)(6) motion to dismiss for failure to state a claim tests the sufficiency of a complaint and eliminates those actions “which are fatally flawed in their legal premises and designed to fail, thereby sparing litigants the burden of unnecessary pretrial and trial activity.” Young v. City of St. Charles, 244 F.3d 623, 627 (8th Cir. 2001). “To survive a motion to dismiss, a claim must be facially plausible, meaning that the ‘factual content . . . allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'” Cole v. Homier Dist. Co., 599 F.3d 856, 861 (8th Cir. 2010) (alteration in original) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). The Court must “accept the allegations contained in the complaint as true and draw all reasonable inferences in favor of the nonmoving party.” Id. (quoting Coons v. Mineta, 410 F.3d 1036, 1039 (8th Cir. 2005)).

         II. Discussion

         Each challenged count is discussed below. Many of the defendants' arguments echo positions they took in their motions to dismiss the Crop Damage Class Action Master Complaint. The Court granted in part and denied in part those motions in In re Dicamba Herbicides Litig., 359 F.Supp.3d 711 (E.D. Mo. 2019).

         A. Failure to Warn (Counts II and IV)

         Monsanto alone moves to dismiss plaintiffs' failure to warn counts. Monsanto argues, as it did in its motion to dismiss the MDL's Master Crop Damage Complaint, that the claims are preempted by the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”), 7 U.S.C. § 136v(b), which regulates the use, sale, and labeling of pesticides. The parties appear to agree that the same ruling this Court reached in the MDL motion to dismiss should apply here: plaintiffs may not submit failure to warn labeling claims that exceed the parameters of FIFRA. In re Dicamba Herbicides Litig., 359 F.Supp.3d at 736 (“plaintiffs will not be allowed to submit failure to warn labeling claims that exceed the parameters of FIFRA”). Monsanto suggests this Court should reconsider its ruling regarding non-label-related claims, as this Court held that “non-label-related marketing efforts are not preempted, even to the extent that those claims are based in part on failure to warn.” Id. at 735. Monsanto relies on the same cases it relied upon in the MDL briefing, which were considered in depth by the Court in its memorandum and order. The Court declines to reconsider.

         Monsanto also argues that the failure-to-warn claims must fail because plaintiffs allege that no warning would have prevented their damages. Plaintiffs' Counts II and IV allege that defendants “did not give adequate warnings to purchasers or third-parties of the danger of their dicamba-based products” and that defendants “failed to use ordinary care by neglecting to provide an adequate warning of the danger of their dicamba-based product.” (Id. ¶ 585, ¶ 608.) At the same time, plaintiffs allege

437. The defect is with Defendants' products, not with the labels or the restrictions placed on them…

(TAC ¶ 437.) In addition, plaintiffs allege that “additional application restrictions on the herbicides simply will not fix this problem [of off-target movement].” (TAC ¶ 433, see also ¶ 434.)

         Under Missouri law, a failure to warn claim requires an allegation that the injury was proximately caused by the alleged deficiency in the warning. Moore v. Ford Motor Co., 332 S.W.3d 749, 762 (Mo. banc 2011); Johnson v. Medtronic, Inc., 365 S.W.3d 226, 232 (Mo. App. W.D. 2012). Because plaintiffs allege that additional warning regarding the use of defendants' dicamba products would not have prevented their injury, Monsanto argues that they have not pleaded proximate cause.

         Plaintiffs disagree. They contend Monsanto is still liable for failure to warn of defects inherent in their products, even if the warning could not have cured, for example, the volatility that made the product defective. They argue that even though application restrictions would not have prevented dicamba from volatizing and moving off-target, proper warning could have altered farmers' decisions to purchase and spray a defective, highly volatile herbicide in the first place. For example, plaintiffs allege that “as consumers were making decisions about what seed and herbicides to purchase and plant in the future, [defendants] ran false, misleading, and confusing advertisements for the Xtend crop system.” (TAC ¶ 296.)

         This Court concludes that plaintiffs have adequately pleaded failure to warn. The determinative issue in a failure-to-warn claim is “whether the information accompanying the product effectively communicates …the dangers that inhere in the product during normal use and the dangerous consequences that can or will result from misuse or abnormal use of the product.” Nesselrode v. Executive Beechcraft, Inc., 707 S.W.2d 371, 382 (Mo. banc 1986). Plaintiffs plead that defendants did not provide adequate warning of the dangers inherent in their products and that plaintiffs were damaged as a result of that failure to warn. Plaintiffs also claim, in their products liability counts, that the defendants' products were defective and unreasonably dangerous. Parties are permitted to plead “alternative statements of a claim or defense” under Federal Rule of Civil Procedure 8(d). For purposes of the motions to dismiss, then, the failure to warn claims survive.

         B. Negligent Training (Count V)

         Both Monsanto and BASF move for dismissal of plaintiffs' negligent training count. Plaintiffs admit that they cannot bring negligent training claims with respect to the training of third parties. See In re Dicamba Herbicides Litig., 359 F.Supp.3d at 740. Plaintiffs suggest that do not bring any such claims even though they allege defendants had a duty to train “employees, agents, and product users.” (TAC ¶ 616; see also TAC ¶ 617, 618.) To the extent plaintiffs claim defendants failed to train non-employees/agents, such claim will be dismissed.

         Defendants argue plaintiffs have not adequately pleaded a claim for negligent training of defendants' employees/agents.[1] Plaintiffs contend that defendants' employees/agents were not trained regarding the risk of harm to innocent third parties and thus engaged in behavior that caused harm. Specifically, plaintiffs allege defendants' employees/agents encouraged farmers to spray illegal dicamba formulations, and they refused to inspect plaintiffs' damages or take any action to address damage caused by illegal spraying or failure to follow labels. Plaintiffs also identify Greg Starling, Boyd Carey, and other employees/agents who allegedly failed to take action. In addition, they allege defendants did not train dealers until after a final XtendiMax label was approved, which was well after the alleged illegal spraying of old dicamba damaged plaintiffs' peach trees.

         At the motion to dismiss stage, as stated above, plaintiffs must plead facts that allow the Court “to draw the reasonable inference that the defendant is liable for the misconduct alleged.'” Cole, 599 F.3d at 861. Notably, similar negligent training claims in the Master Crop Damage Complaint survived summary judgment. See In re Dicamba Herbicides Litig., 359 F.Supp.3d at 740. Defendant Monsanto now contends that plaintiffs' claim fails because they fail to identify under-trained individuals by name and so have failed to establish that an employment relationship existed. See J.H. Cosgrove Contractors, Inc. v. Kaster, 851 S.W.2d 794, 798 (Mo. App. W.D. 1993). However, other cases defendants cite in favor of their position involved complaints which failed to include any allegations about training. Although plaintiffs' allegations regarding training are thin, they have sufficiently pleaded that defendants' employees and/or agents were insufficiently trained, and that they were damaged as a result. The motion to dismiss will be denied on this claim.

         C. Missouri Crop Protection Act ...


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