More than 2,000 state, local and tribal governments are suing two dozen pharmaceutical manufacturers and distributors, arguing that they’ve helped create an opioid crisis that has claimed hundreds of thousands of American lives. The suits include claims that the industry misled doctors and consumers about the drugs’ safety and negligently allowed opioids to fall into the wrong hands. Most of the litigation has been consolidated in federal district court in Ohio, where trial is set to begin Oct. 21.
The government plaintiffs agree that the industry is complicit in the crisis, but the public officials involved disagree on a variety of issues. Several state attorneys general recently criticized the tentative deal between most of the government plaintiffs and OxyContin manufacturer Purdue Pharma. The states and localities have also tangled over who will control the litigation.
Why are we seeing these conflicts, and where is this litigation likely to go next?
Large-scale public health litigation is difficult to resolve
This case will be particularly difficult to resolve, for three main reasons.
First, the scale of this public health crisis is vast, affecting millions either directly or indirectly — which means millions of Americans strongly want to see justice for its victims. Second, each government within the massive plaintiff pool wants a share of the proposed settlement for its own jurisdiction’s opioid abuse victims. Finally, federal law limits the amount of money a court can award in such lawsuits, meaning those governments will have to skirmish among themselves to divvy up those funds.
All these difficulties affected the tobacco litigation of the 1990s, when states sought to hold tobacco companies accountable for misdeeds that allegedly harmed public health. The litigation resulted in a $206 billion settlement agreement among 46 states and several leading tobacco companies, which included restructuring how the industry did business. While they did finally come to an agreement, public officials skirmished among themselves throughout the litigation. Republican attorneys general and those from tobacco-producing states were noticeably slower to join the lawsuits than Democrats. Further, local governments complained they were largely cut out of the tobacco settlement proceeds — complaints that grew louder when many states used settlement funds for purposes other than tobacco control.
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The opioid litigation involves cooperation and conflict among the plaintiffs — much as in other public health litigation
Our research finds that multistate litigation today involves similar patterns of conflict and cooperation. For example, conflicts frequently emerge in lawsuits challenging federal policy. Republican coalitions of attorneys general filed 63 lawsuits challenging the Obama administration over two terms. Democratic coalitions have already filed more lawsuits than that against the Trump administration, in just its first term. However, state attorneys general from both parties generally support corporate settlements such as the tobacco litigation and the 2012 $25 billion bank settlement over illegal and fraudulent foreclosure practices.
In some ways, various governments are cooperating more in the opioid litigation than they did against the tobacco industry. Attorneys general have generally agreed about both the opioid crisis’s scope and the industry’s culpability. Attorneys general from both parties have investigated companies — even those based within their states. The earliest to sue represented both parties.
But now, facing the question of how much companies should pay and to whom, the attorneys general are skirmishing along party lines. For example, 24 attorneys general have agreed to a tentative deal with Purdue that would require it to pay out roughly $10 billion over the next several years; of those, 22 are Republicans.
While Republican attorneys general seem to believe those funds will be enough to repair communities hurt by the opioid crisis, Democratic attorneys general are largely skeptical — and are skeptical about Purdue’s ability to pay and whether the settlement inappropriately protects the Sackler family, which owns Purdue. That’s because settlement money is supposed to come from the company’s sale of opioid treatment drugs that the FDA has not yet approved and that will face market competition if and when they come to market. What’s more, the New York attorney general recently reported that the Sacklers have moved billions of dollars offshore, out of the reach of even potential settlements. That has hardened the Democratic attorneys general’ opposition to the settlement, and will likely increase public pressure to not let the Sacklers off the hook.
Partisanship isn’t the only line of conflict. Believing they were unfairly shut out of the tobacco litigation, local governments sued the opioid industry separately from the states. A bipartisan group of AGs, in turn, has complained to the judge overseeing the consolidated litigation that the local governments’ involvement was complicating settlement negotiations.
What’s next?
As expected, Purdue filed for bankruptcy shortly after reaching the proposed settlement — but still want to pay $34 million in bonuses to high-performing employees. The states objecting to the settlement say they will fight the deal in bankruptcy court, aiming to override any of bankruptcy’s usual protections from further litigation. Expect a partisan battle among the states in one of the most high-profile bankruptcy cases in years.
Also expect still more skirmishing between states and localities over who gets paid. Local governments are generally represented by private class-action attorneys who will expect a share of the proceeds, further complicating any discussions. In the tobacco lawsuits, the large payments that went to private law firms were controversial — and surely would be in this case as well.
Purdue isn’t the only company being sued. The other defendants are supposed to go to trial in October. As that gets closer, expect the uncertainty of trial to pressure all parties to settle. In response, the parties will likely fight for last-minute advantages. Earlier this month, several attorneys general asked the U.S. Court of Appeals for the 6th Circuit to halt the localities’ suits in federal district court while the attorneys general alone complete settlement talks. Meanwhile, the defendants have asked the judge overseeing the cases to recuse himself, alleging bias — which plaintiffs argue is just an attempt to delay the trial.
Of course, no one knows yet whether the opioid litigation will lead to the sort of global agreement that ended the tobacco litigation. But the patterns of cooperation and conflict are anything but surprising in litigation trying to address complex areas of public policy.
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Colin Provost is an associate professor of public policy at University College London.
Paul Nolette is an associate professor of political science at Marquette University. He is the author of Federalism on Trial: State Attorneys General and National Policymaking in Contemporary America (University Press of Kansas, 2015).