- The GMO corn lawsuit will not bankrupt Syngenta.
- Syngenta is a major multi-national corporation worth more than $32 billion.
- Syngenta maintains extensive insurance to protect itself from potential litigation damages.
- Syngenta has substantial cash-on-hand, which it could use to pay a large, multi-billion dollar settlement in this case.
- Syngenta will only pay those farmers who timely file suit against it; those who miss their state’s statute of limitations will not be included in any settlement, and will not cost Syngenta a single dollar.
Syngenta’s Net Worth
Syngenta is a giant corporation with worldwide operations. Its market capitalization exceeds $32 billion.
Syngenta’s sales exceed $14 billion per year, providing it with well over $1 billion a year in net operating capital. Thus, a year of sales alone could fund a major nationwide settlement in this case.
Syngenta’s Insurance
Syngenta maintains substantial insurance to protect itself from potential litigation damages. Syngenta self-insures or uses a combination of insurance and self-insurance for certain risks. In its 2013 Annual Report to its shareholders, Syngenta states:
“Litigation is subject to many uncertainties, and the outcome of individual matters cannot be predicted with certainty. Syngenta maintains general liability insurance, including product liability insurance, covering claims on a worldwide basis with coverage limits and retention amounts which management believes to be adequate and appropriate in relation to Syngenta’s businesses and the risks to which it is subject.”
Syngenta’s Cash-On-Hand
Syngenta is a worldwide operation that generates huge amounts of cash that can be used to finance a settlement of these cases. Syngenta reported “cash and cash equivalents on December 31, 2013 and 2012 of $902 million and $1,599 million, respectively. Of total cash and cash equivalents of $902 million (2012: $1,599 million), $153 million (2012: $125 million) is required to meet insurance solvency requirements of the Group’s insurance subsidiaries.”
Syngenta’s Limited Liability
The liability faced by Syngenta in this litigation is not sufficiently large to cause it to consider filing for bankruptcy. Even though Syngenta’s conduct harmed every corn farmer in the United States, it will not have to pay them all.
Syngenta will only have to pay those farmers who timely file suit against it. Corn farmers who do not meet their state’s statute of limitations will not be included in any settlement.
While there are more than 440,000 corn farmers in America—farming more than 88 million acres of corn—we anticipate that only 25% of them will timely file lawsuits against Syngenta. This dramatically reduces Syngenta’s potential liability.
In conclusion, there is no realistic risk of this litigation bankrupting Syngenta, a major multi-national corporation worth more than $32 billion.
Written by:
Mikal C. Watts
Watts Guerra LLP
4 Dominion Drive, Bldg. 3, Suite 100
San Antonio, Texas 78257
Phone (210) 447-0500
Email mcwatts@guerrallp.com
*This information is provided to supply relevant information concerning the GMO corn lawsuit, and should not be received as legal advice. Legal advice is only given to persons or entities with whom Watts Guerra LLP has established an attorney-client relationship. If you have another lawyer in the GMO Corn lawsuit, you should consult with your own attorney, and rely upon his or her advice, rather than the information contained herein.
© Watts Guerra LLP 2015
