Bayer to pay $1.5 mln in 2nd lawsuit over GM rice

Fri Feb 5, 2010 1:22pm EST

* Second ruling of about 500 similar cases pending

* U.S. jury orders Bayer to pay $1.5 million in damages

* Company says will consider legal options

(Adds details, background)

FRANKFURT, Feb 5 (Reuters) - Germany's Bayer (BAYGn.DE) was ordered by a jury in the United States to pay $1.5 million in damages to three farmers for losses they incurred because of contaminations of Bayer's genetically modified rice, the second in about 500 similar cases pending.

The jury's ruling in a St. Louis court against Bayer's CropScience division follows a related case in December, in which Bayer was ordered to pay $2 million, the chemicals- and drugmaker said on Friday after the close of trading in Germany.

"The company will assess this ruling thoroughly and consider its options," a Bayer spokesman in Germany said.

"Bayer CropScience is standing by its view that the company has handled its biotech rice responsibly and appropriately at all times," he added.

A rice variety whose genetic code had been modified by a Bayer subsidiary for research purposes and which was not approved for commercial cultivation was found in the food supply chain in August 2006 after it had been tested by a U.S. university.

As a result, Japan and the European Union restricted U.S. rice from crossing their borders, leading to a plunge in rice prices, a drop in exports and extensive losses incurred by U.S. rice farmers.

"Since the amounts claimed differ considerably from case to case, the rulings so far do not allow for conclusions regarding the outcome of the remaining cases pending," Bayer said.

The long-grain rice in question had a protein known as Liberty Link, which allows the crop to withstand applications of a certain weed killer.

The U.S. Department of Agriculture and the Food and Drug Administration said at the time there was no public health or environmental risk associated with the rice variety. (Reporting by Ludwig Burger; Editing by Rupert Winchester)

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