State’s opioid trial goes on, seeks twice the amount of global settlement

Johnson & Johnson and drug distributors are nearing a $26 billion global settlement with thousands of municipalities that claim the companies fueled an opioid crisis, but Los Angeles and other government entities in California continued to fight for a much larger sum in a bench trial in Orange County on Tuesday.

Three major drug distributors, McKesson Corp., Cardinal Health Inc. and AmerisourceBergen Corp., will pay $21 billion and Johnson & Johnson will pay an additional $5 billion over the next 18 years to settle thousands of government filed lawsuits claiming they fueled the nation's opioid crisis. Johnson & Johnson did not admit any wrongdoing.

While details haven't been made public, a person familiar with the settlement said if 48 states and 98% of the litigating and nonlitigating subdivisions elect to participate, the drug companies will provide the maximum amount of abatement funds. As fewer municipalities participate, the amount of abatement money decreases on a sliding scale, the source explained.

Paul Geller of Robbins Geller Rudman & Dowd LLP, who as a member of the Plaintiffs' Executive Committee represents the cities of Los Angeles, San Diego, San Francisco, Phoenix and many more, said in an email that the settlement can't be done piecemeal.

"We've had a handful of opioids trials, and several are going on right now -- but unless we all are like Methuselah and can try a few cases a year for the next 100 years, trials are not the answer," Geller said. "We need a global settlement. It can't be done bit by bit or community by community, because if one county settles but its neighboring county doesn't, you've still got a big problem."

The committee, which also includes Joseph Rice of Motley Rice LLC, said trials, such as the three-month-old bench trial in Orange County in which plaintiffs seek $50 billion to abate the opioid crisis in California, "will continue in parallel with the settlement process."

"The plaintiffs are working diligently with the states' attorneys general and the defendants to finalize the settlement terms," the committee said in a statement Tuesday. "The agreement will provide a framework for substantial funds to states and subdivisions for abatement of the opioid epidemic across the country and will impose transformative changes in the way the settling defendants conduct their business to safeguard against further harm by these defendants. We are very optimistic that we can get the final terms released in a matter of days."

During a news conference Tuesday, Los Angeles City Attorney Mike Feuer said while he didn't know the exact amount the city would receive from the settlement, per conversations with Attorney General Rob Bonta, California is slated to receive $2.2 billion and LA will receive tens of millions over the next 18 years.

"My goal is that the tens of millions of dollars we expect from this settlement for our city will target the intersection between substance abuse disorder and homelessness," Feuer said. "We sued because no corporation, no matter how powerful, should be allowed to get away with putting profits over people's lives. Though no amount of money can ever replace the lives lost and families shattered by opioid addiction in Los Angeles, this substantial settlement will help prevent future devastation."

More than 14,000 people died from overdoses involving prescription opioids nationwide, in 2019, according to the city's statement Tuesday.

Between 1999 and 2019, nearly 247,000 people died in the U.S. from overdoses involving prescription opioids and the total economic burden of prescription opioid misuse in the nation is $78.5 billion a year, including the costs of health care, lost productivity, addiction treatment and criminal justice involvement, according to the Centers for Disease Control and Prevention.

Asked if he was satisfied with the settlement amount of $2.2 billion over 18 years expected to go to the state, Feuer said it was better than what plaintiffs were offered a few years ago.

"It's billions of dollars more than a proposed settlement that was floated just a couple of years ago, so by hanging in there and hanging tough in these negotiations, the team across the nation has secured, if this gets approved, billions of additional dollars," Feuer said. "Also I'll say this, the clock is ticking every day that we allow this crisis to persist. Every day that we allow the intersection I mentioned in homelessness and opioid addiction to persist, every day we don't actually deliver changes that abate this in the future, is a day that will cost lives."

New York Attorney General Letitia James announced Monday she had agreed to a separate, $1.1 billion settlement with the three distributors to combat the state's opioid epidemic. However, West Virginia Attorney General Patrick Morrisey, whose state is involved in an opioid jury trial, said he will likely pass on the settlement, according to the state's Metro News outlet.

As settlement discussions continued Tuesday, the plaintiff counties of Los Angeles, Orange, and Santa Clara along with the city of Oakland continued their trial in Orange County. California's false advertising, unfair competition and public nuisance suit accuses Janssen, Purdue Pharma, Teva Pharmaceuticals, Endo Pharmaceuticals, and Allergan PLC of fueling an opioid crisis in the state by downplaying risks of addiction in their marketing.

The lawsuit, which is the first government initiated opioid court action in the nation, is being tried remotely before Orange County Superior Court Judge Peter Wilson. People v. Purdue Pharma et al., 14-00725287 (Orange Super. Ct, filed May 21, 2014).