• Tedd Long

BULLETIN: Opiate Litigation

Updated: Jan 4


Case Overview

Entities in every link in the chain of opioid drug production have been accused of fueling the nation’s opioid crisis for monetary benefit. Plaintiffs seek compensation for the large amount of money they have spent coping with healthcare and crime issues dating back to the 1990s. In perhaps the most complex civil litigation to ever exist in the US, recently over 2,000 pending lawsuits from across the country have been consolidated under one single federal judge, Judge Dan Polster, into a multi-district litigation (MDL). The purpose of this MDL is to guide pretrial motions and keep the multitude of proceedings on the same trajectory. There are also many cases, including those brought by the States’ Attorneys General that are outside the MDL.

Recent Progress

Judge Polster has plotted several bellwether trials across the US, which will test the ability of different sets of plaintiffs to sue different sets of defendants. The bellwether case that was expected to go to trial in October of 2019 settled with the defendants and is awaiting final approval from the court. The next trial is scheduled for October 2020 in Judge Polster’s court in Cleveland, OH.

After the pretrial of the bellwether, each case will be sent back to the original court to conduct the trial. Judge Polster has stated numerous times that he is hoping to reach a “global settlement” with all defendants that would settle all future lawsuits by cities and counties at the federal level.

Judge Polster has granted Class Certification to a unique “Negotiation Class” that consists of local government entities including counties and cities. If a company decides to settle, the “Negotiation Class” will be used to vote on approval of the Settlement.

The actions of the “Negotiation Class” will not affect the trials or proposed settlements of other plaintiff groups, including Native American Tribes, third-party payors and hospitals. Judge Polster has already agreed that a set of union benefit plans can go forward with their suit, which sets this as a bellwether trial for third-party payor claims.

Lawsuits and Settlements Outside of the MDL

Outside of the MDL, we are taking note of settlement agreements at the local level, state level, and sometimes a hybrid that encompasses both. Most of these proposals will allocate money directly to the government, with little going back to businesses. West Virginia and Ohio are just two states that have presented plans for voting and allocating funds if settlements are negotiated at the state and local level.

To add to the complexity of these cases, there are many disputes regarding the correct amount to assign to the costs incurred due to the opioid epidemic. Some are estimating that a global settlement could be valued at $88 billion. Different sets of plaintiffs, including the States, are all clamoring to stake their claim, each arguing they have judicial power to create new laws to solve societal problems.

What Does This Mean?

The current opioid litigation could produce numerous trials and outcomes including state-specific settlements, or the progression of the consolidated litigation could pressure the defendants into creating a “global settlement” with all of the classes. The bellwether trials on the docket have already put stress on all of the defendants and their resources.

Note about Purdue Bankruptcy Settlement

You may have received a notification about the Purdue Bankruptcy Settlement. Please note that this is not a class action settlement, rather it is a notification regarding claims with respect to bankruptcy proceedings. If your organization wishes to seek compensation from this case, then we suggest that you work with legal or an external attorney to draft your proof of claim and corresponding alleged damages.

Please note that there is already a defined list of entities who have established their interest in this case, so any claim that you submit for approval will be behind these creditors.

We are monitoring the opioid litigation closely. If any class action settlements become available as a result of the opioid cases, then we will alert all eligible clients and pursue their settlement claims accordingly.

Next Steps for MCAG Clients

There are many yet unanswered questions regarding the National Prescription Opiate Litigation. It has been difficult to establish the correct numbers when assessing the total costs incurred by each set of plaintiffs, which has made it even more difficult to predict the value of a potential “global settlement”. It is also unknown how the funds created from a potential “global settlement” would be allocated and which entities will be eligible to benefit.

MCAG is actively monitoring and researching all proposed and approved settlements that arise within the MDL and outside of the MDL. Our focus is examining which settlements would benefit hospitals as well as the end-payor class, which includes employers who cover medical expenses in their employee benefit pharmaceutical plans.

In the meantime, MCAG continues to monitor and research the consolidated National Prescription Opiate Litigation as well as separate State and hybrid State-Local government cases and settlements. As more companies settle and more bellwether trials approach, it is hopeful that a “global settlement” will be reached quickly, benefiting all types of entities.