upgrading to Cats 2.8.0 causes scalac exception during compilation of downstream lib

My lib thomas sees a compilation failure with a scalac exception

scala.reflect.internal.Types$NoCommonType: lub/glb of incompatible types: [_] and  <: Product

I am submitting this issue mainly to create a record so that when/if other users seeing the same issue can reference this one.
I have no clue about the nature of the scalac exception or possible causes. There isn't much detail provided by scalac for debugging. The somewhat more detailed scalac debug log here

debug] Initial set of included nodes: 
[debug] Recompiling all sources: number of invalidated sources > 50.0% of all sources
[debug] compilation cycle 1
[info] compiling 25 Scala sources to /Users/kailuowang/projects/thomas/analysis/target/scala-2.12/classes ...
[debug] Getting org.scala-sbt:compiler-bridge_2.12:1.7.0:compile for Scala 2.12.16
[debug] [zinc] Running cached compiler 2a957a3f for Scala compiler version 2.12.16
[debug] [zinc] The Scala compiler is invoked with:
[debug] 	-encoding
[debug] 	utf8
[debug] 	-deprecation
[debug] 	-feature
[debug] 	-unchecked
[debug] 	-language:existentials
[debug] 	-language:experimental.macros
[debug] 	-language:higherKinds
[debug] 	-language:implicitConversions
[debug] 	-Xcheckinit
[debug] 	-Xlint:adapted-args
[debug] 	-Xlint:by-name-right-associative
[debug] 	-Xlint:constant
[debug] 	-Xlint:delayedinit-select
[debug] 	-Xlint:doc-detached
[debug] 	-Xlint:inaccessible
[debug] 	-Xlint:infer-any
[debug] 	-Xlint:missing-interpolator
[debug] 	-Xlint:nullary-override
[debug] 	-Xlint:nullary-unit
[debug] 	-Xlint:option-implicit
[debug] 	-Xlint:package-object-classes
[debug] 	-Xlint:poly-implicit-overload
[debug] 	-Xlint:private-shadow
[debug] 	-Xlint:stars-align
[debug] 	-Xlint:type-parameter-shadow
[debug] 	-Xlint:unsound-match
[debug] 	-Yno-adapted-args
[debug] 	-Ypartial-unification
[debug] 	-Ywarn-dead-code
[debug] 	-Ywarn-extra-implicit
[debug] 	-Ywarn-nullary-override
[debug] 	-Ywarn-nullary-unit
[debug] 	-Ywarn-numeric-widen
[debug] 	-Ywarn-value-discard
[debug] 	-Ywarn-unused:implicits
[debug] 	-Ywarn-unused:imports
[debug] 	-Ywarn-unused:locals
[debug] 	-Ywarn-unused:params
[debug] 	-Ywarn-unused:patvars
[debug] 	-Ywarn-unused:privates
[debug] 	-Xfatal-warnings
[debug] 	-Xlint:-package-object-classes
[debug] 	
[debug] 	-Xplugin:/Users/kailuowang/Library/Caches/Coursier/v1/https/repo1.maven.org/maven2/org/typelevel/kind-projector_2.12.16/0.13.2/kind-projector_2.12.16-0.13.2.jar
[debug] 	-Xplugin:/Users/kailuowang/Library/Caches/Coursier/v1/https/repo1.maven.org/maven2/org/scalamacros/paradise_2.12.16/2.1.1/paradise_2.12.16-2.1.1.jar
[debug] 	-bootclasspath
[debug] 	/Users/kailuowang/.sbt/boot/scala-2.12.16/lib/scala-library.jar
[debug] 	-classpath
....  omitting the classpath
[error] ## Exception when compiling 25 sources to /Users/kailuowang/projects/thomas/analysis/target/scala-2.12/classes
[error] scala.reflect.internal.Types$NoCommonType: lub/glb of incompatible types: [_] and  <: Product

Reproduce the failure by compiling the downstream thomas library with Cats 2.8.0, Scala 2.12.16, and the compiler options and plugins shown in the report. Start with the provided scalac exception and debug log; done means identifying a minimal reproducible case and confirming whether Cats or the Scala compiler needs a fix.