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Keywords

damagesnegligencetrialtestimonypunitive damages
damagestestimonypleamotionsummary judgmenttrustpartnershippunitive damagescompensatory damagesmotion for summary judgment

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Bayer CropScience LP v. Schafer, 2011 Ark. 518, 385 S.W.3d 822

Facts

The case arose when rice farmers sued Bayer after genetically engineered rice, known as LibertyLink Rice (LLRice), was found in the U.S. rice supply without regulatory approval. The USDA announced the contamination in August 2006, leading to a ban on certain rice varieties and significant economic harm to the farmers due to decreased export opportunities. The farmers claimed Bayer was negligent in its field trials, which allowed the contamination to occur, and sought damages for the economic losses they suffered as a result.

The rice farmers filed suit against Bayer in the Circuit Court of Lonoke County on August 29, 2006. In their fifth amended complaint, they alleged that Bayer knew that the majority of American-grown rice was exported; that Bayer knew that other countries did not import genetically modified rice; and that Bayer knew that any contamination of the United States rice supply with genetically altered rice would depress the export market and adversely affect the price of American long-grain rice.

Issue

The main legal issues included whether the statutory cap on punitive damages was unconstitutional, whether the rice farmers' claims were barred by the economic-loss doctrine, and whether the circuit court erred in allowing expert testimony on future damages.

The statutory cap on punitive damages is unconstitutional under section of the Arkansas Constitution prohibiting the General Assembly from limiting the amount to be recovered for injuries resulting in death or for injuries to persons or property.

Rule

The court held that the statutory cap on punitive damages was unconstitutional under the Arkansas Constitution, which prohibits limiting recovery for injuries to persons or property. Additionally, the court ruled that the economic-loss doctrine did not bar the farmers' claims due to evidence of physical harm to their property.

The statutory cap on punitive damages offends the separation-of-powers doctrine found in article 4, section 2 of the Arkansas Constitution by encroaching upon the judiciary's authority to exercise remittitur and by intruding on this court's power vested under amendment 80, section 3, to prescribe the rules of pleading, practice, and procedure for all courts.

Analysis

The court applied the rule by determining that the statutory cap on punitive damages infringed upon the farmers' constitutional rights to recover for their injuries. It also found that the economic-loss doctrine was not applicable in this case because the contamination resulted in physical harm to the farmers' crops and equipment, allowing them to recover economic damages.

The circuit court orally denied Bayer's motion in limine to exclude the testimony of Marsh, and the court refused Bayer's motion for summary judgment concerning the economic-loss doctrine.

Conclusion

The Supreme Court affirmed the Circuit Court's judgment, upholding the jury's award of compensatory and punitive damages to the rice farmers.

We hold that section 16–55–208 is unconstitutional under article 5, section 32 as it limits the amount of recovery outside the employment relationship.

Who won?

The rice farmers prevailed in the case because the court found that Bayer's negligence led to significant economic harm, and the statutory cap on punitive damages was unconstitutional.

The jury found that Bayer was negligent, and it awarded compensatory damages in the amounts of $44,806 to Randy Schafer; $62,660 to End of the Road Farms, Inc.; $191,239 to Schafer Planting Co.; $292,794 to Wallace Farms; $221,537 to Robert E. Moery; $117,700 to Kyle Moery; $1,386,988 to Carter Farms Partnership; $32,894 to Robert Petrus, Petrus Farms, and Robert Petrus Revocable Trust; $486,264 to R & B Amaden Farms; $1,222,523 to Randall J. Snider; $437,334 to R & S Planting Co., Inc.; $186,741 to S & R Farms; $1,046,932 to A.S. Kelly and Sons; and $245,193 to Neil Daniels Farms.

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