Bifurcation debate halts Orange County opioids trial

A battle over bifurcation has halted what was once set to be the nation's first trial in the tidal wave of litigation that's consumed the opioid industry, with a four-jurisdiction team led by Orange County now calling for its case to be heard in two parts.

The request, lodged late Friday in Orange County Superior Court, is opposed by the defendants, but the judge who will consider it already indicated a two-phase trial could be appropriate, and a June trial date that's been set since last year is now off calendar.

The development raises questions about the future of what began five years ago as the first action in the nation's latest public health court epic but has since whittled as thousands of other jurisdictions pursue new legal theories that have earned more prominence, including a trial in May in Oklahoma that a county judge has allowed to be televised.

The other cases appear to be affecting Orange County's litigation. A looming discovery fight involves rulings adopted by special master Stephen G. Larson of Larson O'Brien LLP, partly in accordance with the federal multi-district litigation in Ohio.

On separate points, both plaintiffs and defendants argue the federal lawsuit should not be considered in the Orange County lawsuit, including a defense argument against providing information on generic opioids and a plaintiffs' argument against the defense receiving detailed patient medical data.

A plaintiff's brief distinguishes the cases this way: "While there is some overlap of issues between the MDL and this case, the elements of the People's claims in this case, the facts needed to prove those claims, and the nature of relief differ from the claims being asserted in the MDL."

Superior Court Judge Peter J. Wilson will consider their objections to Larson's discovery recommendations on April 11. He hasn't said when he'll consider the bifurcation arguments. Attorneys have for a year been working toward a June 18 trial, and it was still scheduled in a Feb. 28 status report, but the new briefings now list the trial date as undetermined.

A state action filed by Oklahoma is now the first case set for trial with a judge in Cleveland County on Friday rejecting a request from Purdue Pharma LP to delay the trial 100 days. It's to be a jury trial while Orange County's action is slated to be a bench trial.

The multi-district litigation in Ohio is scheduled for trial in October though U.S. District Judge Dan A. Polster imposed a gag order on settlement discussions in February 2018 that's still in effect. The judge recently set aside June 18 and 19 and as well as July 16 and 17 for settlement discussions, according to the minutes of a Feb. 14 teleconference.

Now, the statewide action in Orange County is at a crossroads as attorneys argue over the bifurcation of the liabilities and remedies portions of the trial, which the plaintiffs said will allow them to "better tailor their remedial evidence to the Court's rulings, including with respect to witnesses, and will facilitate collaboration between the parties."

"The People anticipate that the liability phase of this trial will be lengthy, if only because of the number of Defendants involved in creating the opioids nuisance currently polluting their jurisdictions," according to the March 8 brief.

Meanwhile, attorneys for defendant Endo Pharmaceuticals Inc., listed "numerous practical, factual, and legal reasons why dividing this case into phases is unlikely to conserve judicial or party resources and is inappropriate under the circumstances."

Forthcoming motions "may significantly reduce or reshape the issues to be tried, making any phasing at this stage premature" and said abatement "is integrally involved with the establishment of liability," according to the brief by John C. Hueston of Hueston Hennigan LLP, which represents Endo with Arnold & Porter LLP.

Attorneys for the other defendants joined, including from Morgan, Lewis & Bockius LLP; Kirkland & Ellis LLP; Dechert LLP and O'Melveny & Myers LLP. Defendants include Purdue Pharma LP, Teva Pharmaceutical Industries Ltd., and Johnson & Johnson.

Wilson said on Jan. 24 the abatement portion of the case is "extremely complicated," which he said lends well to bifurcation because they can establish liability before proceeding to such a time-consuming portion of the case.

"Somebody drops an atom bomb in your backyard, I don't think you have to show it can be perfectly fixed before you have established that the harm was done," Wilson said, according to a court reporter's transcript of the hearings.

Wilson got the case after Judge Kim G. Dunning left for a temporary spot on the 2nd District Court of Appeal. Dunning discussed a two-phase trial during status conferences as late as June 2018, but Wilson said in January his current position on bifurcation was "no more than a leaning."

The lawsuit is a collective action on behalf of the state of California that was initiated by Orange and Santa Clara counties in 2014 with the city of Oakland and Los Angeles County joining last June.

It seeks a statewide injunction as well as civil penalties from opioid manufacturers the plaintiffs argue are liable for California's opioid crisis by falsely advertising the drug and perpetuating a public nuisance that's morphed into a full-fledged crisis.

There are three claims: false advertising, public nuisance and unfair competition. People v. Purdue Pharma et al. (Orange Super. Ct., filed May 21, 2014).