Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-15-02693/USCOURTS-ca8-15-02693-0/pdf.json

Parties Involved:
Bayer AG
Appellee
Bayer BioScience NV
Appellee
Bayer Corporation
Appellee
Bayer CropScience AG
Appellee
Bayer CropScience Holding
Appellee
Bayer CropScience Holding SA
Appellee
Bayer CropScience Inc.
Appellee
Bayer CropScience LLC
Appellee
Bayer CropScience LP
Appellee
Bayer Cropscience US
Appellee
Don M. Downing and Adam J. Levitt
Appellee
Genetically Modified Rice Litigation
Not Party
Riceland Foods
Appellant

Document Text:

United States Court of Appeals

For the Eighth Circuit

___________________________

No. 15-2690

___________________________

In re: Genetically Modified Rice Litigation

------------------------------

Riceland Foods, Inc.,

lllllllllllllllllllll Plaintiff - Appellee,

Don M. Downing and Adam J. Levitt, Plaintiffs’ Co-Lead Counsel and

Co-Trustees of the Genetically Modified Rice Common Benefit Fund,

lllllllllllllllllllllMovant - Appellee,

v.

Bayer Cropscience US; Bayer CropScience LP; Bayer AG; Bayer CropScience

Holding, Inc.; Bayer Corporation; Bayer BioScience NV; Bayer CropScience AG;

Bayer CropScience Inc.; Bayer CropScience LLC; Bayer CropScience Holding SA,

lllllllllllllllllllll Defendants - Appellants.

___________________________

No. 15-2693

___________________________

In re: Genetically Modified Rice Litigation

------------------------------

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Riceland Foods, Inc.,

lllllllllllllllllllll Plaintiff - Appellant,

v.

Bayer Cropscience US; Bayer CropScience LP; Bayer AG; Bayer CropScience

Holding, Inc.; Bayer Corporation; Bayer BioScience NV; Bayer CropScience AG;

Bayer CropScience Inc.; Bayer CropScience LLC; Bayer CropScience Holding SA,

lllllllllllllllllllll Defendants,

Don M. Downing and Adam J. Levitt, Plaintiffs’ Co-Lead Counsel and

Co-Trustees of the Genetically Modified Rice Common Benefit Fund

llllllllllllllllllllllMovant - Appellee.

___________________________

No. 15-2850

___________________________

In re: Genetically Modified Rice Litigation

------------------------------

Riceland Foods, Inc.,

lllllllllllllllllllll Plaintiff - Appellee,

v.

Bayer AG; Bayer CropScience AG; Bayer BioScience NV; Bayer CropScience

LP; Bayer CropScience LLC; Bayer CropScience Holding, Inc.; Bayer

CropScience Inc.; Bayer Corporation,

lllllllllllllllllllll Defendants - Appellants.

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___________________________

No. 15-2893

___________________________

In re: Genetically Modified Rice Litigation

------------------------------

Riceland Foods, Inc.,

lllllllllllllllllllll Plaintiff - Appellant,

v.

Bayer AG; Bayer CropScience AG; Bayer BioScience NV; Bayer CropScience

LP; Bayer CropScience LLC; Bayer CropScience Holding, Inc.; Bayer

CropScience Inc.; Bayer Corporation,

lllllllllllllllllllll Defendants - Appellees.

___________________________

No. 15-3245

___________________________

In re: Genetically Modified Rice Litigation

------------------------------

Riceland Foods, Inc.,

lllllllllllllllllllll Plaintiff - Appellee,

Don M. Downing and Adam J. Levitt, Plaintiffs’ Co-Lead Counsel and

Co-Trustees of the Genetically Modified Rice Common Benefit Fund,

lllllllllllllllllllllMovant - Appellant,

v.

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Bayer Cropscience US; Bayer CropScience LP; Bayer AG; Bayer CropScience

Holding, Inc.; Bayer Corporation; Bayer BioScience NV; Bayer CropScience AG;

Bayer CropScience Inc.; Bayer CropScience LLC; Bayer CropScience Holding SA,

lllllllllllllllllllll Defendants - Appellees.

____________

Appeals from United States District Court 

for the Eastern District of Missouri - St. Louis

____________

 Submitted: April 12, 2016

 Filed: August 31, 2016

____________

Before COLLOTON and SHEPHERD, CircuitJudges, and BOUGH, DistrictJudge. 1

____________

COLLOTON, Circuit Judge.

Bayer AG, along with several of its corporate subsidiaries, and Riceland, Inc.,

appeal an order of the district court requiring Bayer to cause the deposit of a portion 2

of a settlement between Bayer and Riceland into a common-benefit trust fund. This

fund was established to compensate attorneys leading the multidistrict litigation

(“MDL”) concerning Bayer’s LibertyLink LL601 genetically modified rice. We

addressed challenges to the creation of the fund in In re Genetically Modified Rice

Litigation (Rice I), 764 F.3d 864, 870-71, 873-74 (8th Cir. 2014).

The Honorable Stephen R. Bough, United States District Judge for the

1

Western District of Missouri, sitting by designation.

The HonorableCatherine D. Perry, UnitedStatesDistrict Judge for the Eastern 2

District of Missouri.

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Bayer and Riceland argue that because their settlement was the product of

negotiations following a state-court judgment, the district court lacked jurisdiction

to order Bayer to cause a percentage of the settlement to be deposited into the fund. 

As the district court explained, however, Bayer and Riceland were parties to several

federal cases in the consolidated federal litigation, and their settlement resolved the

very claims asserted by Riceland in those federal cases. We conclude that the district

court properly orderedBayer to hold back a portion ofthe Bayer-Riceland settlement,

and we therefore affirm the judgment.

I.

In 2006, Bayer reported to federal regulators that trace amounts of its

experimental LL601 genetically modified rice, which was not approved for human

consumption, had contaminated the commercial long-grain rice supply in the United

States. In response to this disclosure, severalmajorimporters of U.S. rice—including

Japan, the European Union, and Mexico—banned the import of U.S. long-grain rice

orimposed stringent testing requirements. Rice commodity prices and export volume

dropped precipitously following the disclosure. Although LL601 was retroactively

approved for human consumption, the contamination caused significant economic

loss to the domestic rice industry.

In hundreds ofindividual lawsuits, approximately seven thousand rice growers

(“producers”) and others in the rice industry (“non-producers”) sued Bayer and

related entities for losses suffered as a result of the LL601 contamination. 

Approximately three hundred of those lawsuits, comprising the individual claims of

approximately five thousand plaintiffs, were filed in or removed to federal court; the

remaining plaintiffs proceeded in state court. The Judicial Panel on Multidistrict

Litigation, pursuant to 28 U.S.C. § 1407, transferred the federal cases to the United

States District Court for the Eastern District of Missouri for pretrial proceedings. In

re LLRice 601 Contamination Litig., 466 F. Supp. 2d 1351 (J.P.M.L. 2006).

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In April 2007, the district court appointed a leadership group of plaintiffs’

attorneys to coordinate the centralized multidistrict proceedings. Don Downing and

Adam Levitt, appellees and cross-appellants here, were named co-lead counsel for

this coordinated effort. Over the course of the litigation, the leadership group took

over one hundred depositions, managed extensive discovery, and conducted several

bellwether trials; evidence generated from each of these efforts was made available

to all plaintiffs in state and federal court. In addition, the leadership group prevailed

on several motions for summary judgment. A special master determined that the

leadership group and other lawyers engaged by the leadership group invested over

100,000 hours for the common benefit of all plaintiffs.

To compensate lawyers who would contribute to this collective effort, the

district court ordered the creation of a common-benefit trust fund (“Common Benefit

Order”). This order required Bayer to hold back and deposit into the fund a

percentage of all recoveries in the federal litigation: eleven percent of recoveries by

producer plaintiffs, ten percent of recoveries by non-producer plaintiffs, and nine

percent of recoveries by European non-producer plaintiffs. The district court

“reluctantly” determined that it lacked jurisdiction to apply the Common Benefit

Order to “settlements and judgments related to cases pending in state courts,” even

though the state-court plaintiffs would be “unjustly enriched,” because plaintiffs in

those cases were not parties before the district court. As a result, the court limited the

scope ofits order to gross recoveries “related to each federal genetically modified rice

case.” In Rice I, we affirmed the district court’s conclusion that it lacked jurisdiction

over state-court plaintiffs, holding that an MDL judge “does not have the power to

order parties in cases not before it to contribute to the Fund.” 764 F.3d at 874.

Riceland, an Arkansas rice-milling and wholesaling cooperative, was named

as a defendant in over two hundred LL601-related lawsuits; in many cases, Riceland

was a co-defendant with Bayer. But, in the words of Riceland’s attorney, the

company “quickly pivoted and was immediately at the forefront of . . . the LLRICE

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litigation as a plaintiff against Bayer.” Riceland filed a complaint and multiple crossclaims and third-party complaints against Bayer, claiming that Bayer was negligent

in failing to prevent its experimental rice fromcontaminating the U.S. long-grain rice

supply. Riceland asserted claims against Bayer in at least seven cases that were part

of the consolidated multidistrict proceedings.

Two cases in which Riceland asserted claims against Bayer are relevant to this

appeal. In Meins v. Bayer AG, No. CV-2008-108 (Ark. Cir. Ct. Arkansas Cty. filed

Aug. 7, 2008), rice farmers and rice-farming entities sued Bayer and Riceland over

the LL601 contamination. Riceland filed a cross-claim against Bayer in Meins; on

the same day, Riceland filed an identical, original complaint against Bayer in federal

court. Riceland Foods, Inc. v. Bayer AG, No. 3:09-cv-00008-BSM (E.D. Ark. filed

Jan. 20, 2009), transferred, No. 4:09-cv-00433-CDP (E.D. Mo. dismissed Aug. 3,

2015). 

The plaintiffs in Meins settled their claims against Bayer, leaving only

Riceland’s cross-claims for trial. A jury entered a verdict in favor of Riceland and

awarded the company $11.83 million in compensatory damages and $125 million in

punitive damages. The trial court, applying Arkansas’s statutory cap on punitive

damages, reduced the punitive damages award to $1,073,292.

Riceland appealed the remittitur in Meins. After Riceland filed its notice of

appeal, the Arkansas Supreme Court held in a separate LL601 case that the limit on

punitive damages violated the state constitution. Bayer CropScience LP v. Schafer,

385 S.W.3d 822, 829-32 (Ark. 2011). In its opening brief to the state supreme court,

Riceland argued that Schafer required the court to reinstate the full punitive damage

award; Bayer cross-appealed, arguing that the jury’s finding that Riceland was thirty

percent at fault barred the company from recovering damages. On the punitive

damages issue, Bayer conceded that Schafer applied, but argued that if the verdict

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stood, then remand was appropriate to determine whether the $125 million award

violated the state or federal constitution.

After briefing was complete in the Meins appeal, Riceland and Bayer agreed

to settle Riceland’s claims. Under the settlement agreement, Bayer agreed to pay

Riceland $92 million and to indemnify Riceland against any claims arising out of the

LL601 litigation. In exchange, Riceland released “any and all claims . . . growing or

arising out of the presence in the United States rice supply of Bayer GM Rice.” The

release clause stated: “This specifically includes, but is not limited to, the claims

brought in the Scott Meins, et al. v. Bayer AG, et al. case.” The settlement also

requiredRiceland to dismiss with prejudice its claimin Meins, but did not specifically

mention Riceland’s pending federal lawsuit. Neither Bayer nor Riceland moved to

dismiss Riceland’s federal complaint. Bayer represents to the court that it has paid

the $92 million due to Riceland under the settlement.

The plaintiffs’ leadership group attempted, on three separate occasions, to

require Riceland to contribute to the common-benefit fund. On the eve of the Meins

trial, the leadership lawyers moved in the district court for an order applying the

Common Benefit Order to any recovery Riceland obtained in the state-court trial. 

The district court denied the motion, again concluding that although Riceland

received a substantial benefit from the leadership group’s work, the court lacked

jurisdiction over the state-court case. The leadership group also moved to intervene

in Meins to have the state trial court determine whether Riceland should be required

to abide by the Common Benefit Order; the motion to intervene was denied.

After Bayer and Riceland reached their settlement, the leadership group moved

to apply the Common Benefit Order to Riceland’s recovery under the settlement.

Because Riceland was a non-producer plaintiff and a party in the coordinated federal

proceedings, the leadership group argued that Riceland was bound by the Common

Benefit Order to contribute ten percent of the settlement to the common-benefit fund. 

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The district court agreed, concluding that the agreement’s release of “any and all

claims”—including those asserted in Riceland’s federal lawsuit—gave the court

jurisdiction to order funds to be held back from the settlement. The court thus

ordered Bayer to “cause to be deposited” $9.2 million into the common-benefit fund. 

The court entered a separate order dismissing Riceland’s federal lawsuit based on its

finding that the settlement resolved the parties’ dispute. Bayer and Riceland appeal

the application of the Common Benefit Order to the settlement.

Two other actions involving the subject matter of this appeal are currently

pending. In Downing v. Riceland Foods, Inc., No. 4:13-cv-00321-CDP (E.D. Mo.

filed Feb. 20, 2013), the leadership group has sued Riceland for unjust enrichment

and quantum meruit based on the services rendered by the leadership group. The

district court stayed the suit pending resolution of this appeal. Riceland has also sued

Bayer in Arkansas state court, seeking a declaratory judgment that the settlement

agreement assigned to Bayer the cost of contributing to the common-benefit fund. 

Riceland Foods, Inc. v. Bayer CropScience LP, No. CV-2015-072 ND (Ark. Cir. Ct.

Arkansas Cty. filed June 30, 2015).3

II.

This issues presented on appeal can be distilled into three principal questions. 

First, Bayer and Riceland both argue that the order requiring Bayer to hold back a

portion of the settlement should be vacated because the district court lacked

jurisdiction to apply the Common Benefit Order to their settlement. Downing and

Levitt, on behalf of the plaintiffs’ leadership group, maintain that the district court

properly exercised jurisdiction over these parties. Next, even if the district court had

Bayer’s motion for the court to take judicial notice of the state declaratory3

judgment action is granted. See Fed. R. Evid. 201(b)(2), (d); Great Plains Tr. Co. v.

Union Pac. R.R. Co., 492 F.3d 986, 996 (8th Cir. 2007). Bayer’s motion to strike

Parts I and II of the plaintiffs’ leadership group’s reply brief is denied.

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jurisdiction to order an allocation of funds from the settlement, Bayer and Riceland

argue that the amount ordered here was too large. Finally, if the court properly

required a payment, the parties dispute whether Bayer or Riceland should be required

to deposit money into the common-benefit fund. Bayer and Riceland each argue that

the other should be required to pay. The leadership group contends that the district

court’s order was correct as entered, but argues alternatively that Riceland should be

required to pay if Bayer is not.

A.

Bayer and Riceland argue that the district court lacked jurisdiction to order a

contribution to the common-benefit fund. They contend that the order conflicts with

this court’s decision in Rice I.

In Rice I, the plaintiffs’ leadership group appealed the district court’s

conclusion that it lacked jurisdiction to apply the Common Benefit Order to plaintiffs

who recovered damages from Bayer in state court. 764 F.3d at 873-74. State-courtonly plaintiffs, the leadership group argued, benefited fromthe common-benefit work

and would be unjustly enriched unless the Common Benefit Order was applied to

them as well. Id. at 874. While recognizing the potential inequities involved, we

agreed with the district court that it lacked jurisdiction over plaintiffs that were not

in federal court. Id.; accord In re Showa Denko K.K. L-Tryptophan Prods. Liab.

Litig.-II, 953 F.2d 162, 165-66 (4th Cir. 1992); Hartland v. Alaska Airlines, 544 F.2d

992, 994, 996, 1001-02 (9th Cir. 1976). Bayer and Riceland now argue that Rice I

precluded the district court fromordering an allocation fromtheir settlement, because

the settlement was the product of negotiations during the appeal of a state-court

judgment.

Rice I does not control this case, because Riceland and Bayer were parties to

multiple federal lawsuits before the district court at the time ofsettlement. Unlike the

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state-court-only plaintiffs in Rice I, Riceland pursued its claims against Bayer in both

state and federal court. Applying the Common Benefit Order to the state-court-only

plaintiffs in Rice I would have required the federal court to exercise authority over

parties that never appeared in federal court. Riceland, by contrast, “voluntarily

entered the litigation” and sought a federal forum by filing a federal complaint and

asserting third-party claims in the consolidated federal proceedings. Showa Denko,

953 F.2d at 166. The district court therefore had jurisdiction to enter any orders

regarding Riceland that are consistent with the authority of a transferee court in

centralized multidistrict litigation.

No party challenges the propriety of the Common Benefit Order or the “well

established” authority of a district court to compensate leadership lawyers by ordering

funds to be set aside from recoveries obtained by other plaintiffs in multidistrict

litigation. Walitalo v. Iacocca, 968 F.2d 741, 747 (8th Cir. 1992). The Common

Benefit Order required Bayer to hold back amounts “related to each federal

genetically modified rice case.” The Bayer-Riceland settlement released “any and all

claims” of Riceland against Bayer, including Riceland’s claims in the federal cases. 

As a payment in consideration for resolving all of Riceland’s claims, including those

in federal cases, the settlement amount thus “related to” a federal geneticallymodified

rice case within the meaning of the order.

Bayer and Riceland attempt to narrow the scope of the settlement to exclude

the claims asserted inRiceland’s federal complaint and cross-claims. Riceland argues

that the settlement’s release clause “expressly—and only—applies to Meins.” This

argument is belied by the plain language of the settlement agreement, which states

that the release “includes, but is not limited to,” the claims asserted in Meins. The

agreement expressly disclaims that it applies only to Meins.

Bayer advances the more nuanced argument that even if the terms of the

agreement could be interpreted as relating to the federal case, the parties clearly

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intended to exclude the “worthless” federal lawsuit. Bayer contends that in light of

the jury verdict in Meins, it could have secured dismissal of Riceland’s federal

lawsuit under the doctrine of claim preclusion. See Crockett & Brown, P.A. v.

Wilson, 864 S.W.2d 244, 246 (Ark. 1993) (holding that a judgment has preclusive

effect even while on appeal). Bayer argues that it would be illogical to interpret the

agreement as settling a case with de minimis settlement value.

That Bayer might have resolved or defeated Riceland’s federal claims in a

different way, however, does not alter the plain terms of the settlement agreement. 

Bayer and Riceland opted for a release that “includes, but is not limited to” Meins and

extends to “any and all claims.” “The term ‘any and all’ . . . is all-encompassing” and

includes Riceland’s federal claims against Bayer. See Sander v. Alexander

Richardson Invs., 334 F.3d 712, 716 (8th Cir. 2003).

Bayer might have eschewed such broad language and instead relied on the

doctrine of claim preclusion to defeat other claims—federal and state—arising from

the presence of Bayer genetically modified rice in the U.S. rice supply. But Bayer’s

proposed interpretation of the settlement agreement—excluding supposedly

“worthless” claims arising from the same nucleus of operative facts—would mean

that the agreement was in fact “limited to” Meins when the agreement said precisely

the opposite. If the parties wanted to resolve only the Meins lawsuit, and to leave

Riceland’s federal claims open for resolution outside the agreement, then they could

have drafted the settlement agreement more narrowly. The district court did not err

by refusing to vary the terms of the written agreement. See Hurt-Hoover Invs., LLC

v. Fulmer, 448 S.W.3d 696, 703 (Ark. 2014).

Bayer also assertsthatRiceland’s federal lawsuit was “never litigated,” but this

too would not be a reason to ignore the agreement’s resolution of “any and all

claims.” In any event, there was important litigation relating to Riceland’s federal

claim. One month after Riceland filed its federal lawsuit, Bayer moved for partial

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summary judgment on all non-producer claims based on the preemptive effect of the

Plant Protection Act, 7 U.S.C. § 7756(a). If Bayer had prevailed on its motion for

summary judgment, then all of Riceland’s claims would have failed, but the

leadership group successfully defeated Bayer’s motion. The leadership group also

obtained summary judgment on several ofthe affirmative defenses that Bayer asserted

against Riceland, and it obtained extensive discovery materials that benefitted all

plaintiffs. So while Riceland itself may have done little individually to litigate its

federal claim, litigation on its behalf in the consolidated multidistrict proceedings did

benefit Riceland’s claims.

Riceland takes a different tack, arguing that the federal case was moot once the

partiessettled, and that the district court thuslacked jurisdiction over the federal case

when it ordered Bayer to cause a deposit into the common-benefit fund. Riceland’s

argument effectively concedesthat the settlement agreement encompassed the federal

claims. But while Riceland may be correct that the settlement mooted its federal

lawsuit, the district court retained jurisdiction to resolve outstanding collateral

matters, such as attorney fees. Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 395

(1990). Application of the Common Benefit Order was a comparable collateral

matter that the district court had jurisdiction to resolve in light of the settlement.

B.

Bayer and Riceland argue alternatively that even if the federal lawsuits gave

the district court authority to order an allocation from the settlement, the amount

ordered here was too large. Bayer contends that the court was required to apportion

the amount between the federal and state cases, and to limit the order to an amount

that “constituted a federal-court recovery.” Riceland similarly argues that the court

erroneously “ascribed 100% of the value of the settlement to a defunct federal case.”

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If the district court were required to assess the relative value of Riceland’s

federal and state lawsuits, then it would apply Arkansas state contract law to make

that determination. See Amana Refrigeration, Inc. v. Pidgeon’s Furniture &

Appliance Stores, Inc., 883 F.2d 657, 658 (8th Cir. 1989). But there is a first-order

question here: whether the court was required to make an apportionment at all. That

is not a question of state contract law but a question of federal law concerning the

scope of a district court’s authority in overseeing multidistrict litigation.

The equitable common-benefit doctrine permits a district court to redistribute

costs among plaintiffs when “the litigation has conferred a substantial benefit on the

members of an ascertainable class, and where the court’s jurisdiction over the subject

matter of the suit makes possible an award that will operate to spread the costs

proportionately among them.” Mills v. Elec. Auto-Lite Co., 396 U.S. 375, 393-94

(1970); see Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980); Alyeska Pipeline

Serv. Co. v. Wilderness Soc’y, 421 U.S. 240, 264 n.39 (1975); In re Diet Drugs, 582

F.3d 524, 546-47 (3d Cir. 2009); In re Air Crash Disaster at Fla. Everglades on Dec.

29, 1972, 549 F.2d 1006, 1017-18 (5th Cir. 1977). The district court found that the

plaintiffs’ leadership group here conferred a substantial benefit on Riceland. 

Riceland was before the district court as a plaintiff, cross-claimant, or third-party

claimant in at least seven federal cases. The district court had subject-matter

jurisdiction over these federal actions. This jurisdiction was a sufficient basis for the

court to exercise its equitable and managerial authority to prevent Riceland from

freeriding on the work of the leadership group.

There is no separate requirement that the court also have jurisdiction over the

corpus of the settlement, as though this were a quasi-in rem proceeding. The district

court here chose to use amount of recovery as a proxy for the benefit conferred on

individual plaintiffs, but the court could have assessed a flat fee or used some other

measure. See Showa Denko, 953 F.2d at 164; cf. Mills, 396 U.S. at 392, 394. The key

point is that Riceland was enriched by the work of the plaintiffs’ leadership counsel,

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and Riceland’s participation in federal litigation gave the district court authority to

order the setting aside of funds recovered from Bayer to prevent unjust enrichment

of Riceland.

Riceland complains that the district court failed to consider its unique role as

both a plaintiff and a defendant. The company says that it was denied access to some

discovery material and forced to expend its own resources defending against litigation

by the plaintiffs’ leadership group. For these reasons, Riceland contends that the

district court should have analyzed whether the ten percent holdback is inequitable

as applied to Riceland. Riceland, however, did not object to entry of the Common

Benefit Order. The district court, moreover, concluded that Riceland substantially

benefited from the work of the leadership group, relying on its earlier finding that

“the leadership group’s work in discovery, motion practice, and the bellwether trials

has provided a foundation for all cases involved in the litigation.” That Riceland

supplemented this foundation does not disprove or diminish the benefit it derived

from coordinate pretrial litigation. Regarding Riceland specifically, the court noted

that the leadership group mounted a successful defense on the preemption issue, and

that Riceland’s own attorney sought reimbursement from the common-benefit fund,

thus suggesting coordination with other plaintiffs’ counsel. Given the substantial

deference owed to the district court, we cannot say the court committed an abuse of

discretion by concluding that Riceland should be subject to the same set-aside

requirement as other parties who recover from Bayer.

The Bayer-Riceland settlement was the culmination of an extensive effort by

Riceland to assert its claims against Bayer in over a half dozen lawsuits in both state

and federal court. The settlement “related to” and resolved Riceland’s federal claims. 

The district court therefore properly applied the Common Benefit Order to the

settlement and required a percentage of the entire settlement to be redirected to the

common-benefit fund.

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C.

Having determined that the district court properly applied the CommonBenefit

Order to the Bayer-Riceland settlement, we now must address whether the district

court properly ordered Bayer to “caused to be deposited” ten percent of the settlement

into the common-benefit fund. Bayer contends that because it already paid the

settlement amount to Riceland, the district court effectively compelled it to cover

Riceland’s litigation expenses. Such an order, Bayer argues, violates the American

Rule, which prohibits federal courts from shifting the costs of litigation between

adverse parties without statutory authority or a contract between the parties. 

Walitalo, 968 F.2d at 747. Bayer did not present this argument to the district court,

so we review for plain error. See Wiser v. Wayne Farms, 411 F.3d 923, 927 (8th Cir.

2005).

Citing Universal Title Insurance Co. v. United States, 942 F.2d 1311, 1314 (8th

Cir. 1991), Bayer argues that we have discretion to consider a purely legal issue for

the first time on appeal, and that plain-error review should not apply. But the two

propositions are not necessarily inconsistent. If the resolution of a purely legal issue

is “beyond any doubt,” see Wiser, 411 F.3d at 927, then the plain-error standard may

well be satisfied. In any event, Universal Title merely recognized the court’s

discretion to consider certain issues for the first time on appeal. 942 F.2d at 1314.

We disagree with Bayer that it is entitled to more searching appellate review of a

forfeited error than a criminal defendant challenging a conviction or term of

imprisonment. See United States v. Olano, 507 U.S. 725, 732 (1993).

Bayer contends that the authority conferred under 28 U.S.C. § 1407, which

authorizes consolidated pretrial proceedings in multidistrict litigation, is “merely

procedural” and does not give the district court authority to enter a fee-shifting award. 

Rice I, 764 F.3d at 873-74 (quoting Showa Denko, 953 F.2d at 165). The district

court, however, did not order Bayer to pay attorney fees. It ordered Bayer to comply

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with the Common Benefit Order and “cause to be deposited” a portion of the

settlement into the fund. Bayer has never objected to its assigned role of holding

back portions of recoveries. That Bayer opted to pay Riceland before clarifying its

obligations under the Common Benefit Order did not convert enforcement of the

order into an impermissible fee award.

Although Bayer isrequired under the order to cause a deposit into the commonbenefit fund, the order does not mean that the district court has shifted the ultimate

burden to finance Riceland’s litigation. The parties are disputing in state court

whether the settlement agreement assigned to Bayer the cost of complying with the

Common Benefit Order. Riceland Foods, Inc. v. Bayer Cropscience LP, No.

CV-2015-072 ND (Ark. Cir. Ct. Arkansas Cty. filed June 30, 2015). If Bayer

assumed liability for the common-benefit fee by contract, that agreement would be

a permissible form of fee shifting under the American Rule. See Walitalo, 968 F.2d

at 747. Bayer also has not disclaimed an ability to seek contribution or

indemnification from Riceland, and the district court’s carefully worded order

allowed Bayer to “cause” Riceland to make the deposit if Bayer had a legal basis to

do so. We therefore find no plain error in the district court’s order assigning to Bayer

the duty of causing a deposit of the funds due under the Common Benefit Order.

* * *

The big picture here isthat Riceland was enriched by the work of the plaintiffs’

leadership group. The district court had authority to prevent unjust enrichment of

federal-court plaintiffs through the administration of a common-benefit fund. We

concluded in Rice I that where a party proceeded against Bayer exclusively in state

court, the district court lacked jurisdiction to apply the Common Benefit Order to

recoveries obtained in the state-court litigation. As a consequence, some plaintiffs

proceeding exclusively in state court would be unjustly enriched by the work of the

plaintiffs’ leadership group. Where, however, a plaintiff who benefited from this

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work chose to litigate against Bayer in both federal and state court, and to resolve its

claims in a global settlement, the district court was not required to make the loophole

larger. Application of the Common Benefit Order to the Bayer-Riceland settlement

was a proper exercise of the equitable common-benefit doctrine. The judgment of the

district court is affirmed.

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