Every city, town and county in the United States could receive a payout in a settlement with the largest makers, distributors and retailers of prescription opioids, if a judge approves an innovative proposal made Friday in an Ohio federal court by lawyers for hundreds of local governments.
The plan, which legal experts describe as “novel” and “unorthodox,” could potentially expand the number of municipalities and counties eligible for compensation in the federal litigation from 1,650 to about 24,500 and open the way for a comprehensive national opioid settlement with the pharmaceutical industry.
“We have an epidemic caused by pills that have wheels, and different areas of the country get targeted at different points in time,” said Joe Rice, one of the lead lawyers, explaining a major obstacle to settlement in the rapidly accumulating cases. “So if you solve the problem in New York City, it doesn’t get addressed in Albany. And everyone recognizes this is a national issue.”
The goal behind this proposal is to sweeten the incentive for the defendants to negotiate a settlement in earnest, something they have largely resisted. If all municipalities are included in a settlement, the reasoning goes, these companies would not have to fear future lawsuits from local governments.
The new proposal must be approved by Judge Dan Aaron Polster, the federal judge in Cleveland who is presiding over the litigation. Polster has long said his goal is a comprehensive settlement that offers meaningful solutions, both immediate and long term, to the damage wrought by opioids.
The benefit for municipal plaintiffs is straightforward. There is no certainty they could recover anything on their own. Here, the funds to abate the deadly crisis would be guaranteed and delivered more swiftly than if the municipalities pursued their own cases.
A hearing is scheduled for later this month.
“I think this plan is a really clever way to get a handle on the opioid settlement negotiations,” said Howard Erichson, who teaches complex litigation at Fordham Law School.
According to the proposal, all plaintiffs would vote on any settlement offer. To be accepted, 75% of the voters would have to approve. If that supermajority were reached, the agreement would be binding on all participating localities.
“What’s brilliant and beautiful about this plan is that it provides an extra layer of protection against unfair settlement,” Erichson said.