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Last month, two courts handed down opposite rulings in important opioid cases.
In the first case, the Oklahoma Supreme Court threw out a lower court’s ruling that Johnson & Johnson should pay the state $465 million for its role in the crisis. (Its Janssen Pharmaceuticals subsidiary had manufactured opioids.) Oklahoma’s case was built on a relatively new legal theory: that opioid addiction constituted a “public nuisance” and damages, therefore, were due. And while the lower court judge bought that argument, the State Supreme Court was having none of it.
“Oklahoma public nuisance law does not extend to the manufacturing, marketing and selling of prescription opioids,” the judges concluded in their 5-1 opinion.
In the second case, decided just before Thanksgiving, a jury in Ohio concluded that three giant pharmacies, CVS Health, Walmart and Walgreens, had violated that state’s public nuisance law by turning a blind eye to suspicious opioid orders. “The judgment today against Walmart, Walgreens and CVS represents the overdue reckoning for their complicity in creating a public nuisance,” said the lawyers who had brought the suit on behalf of two Ohio counties.
The two cases, with their conflicting rulings, are a good example of why litigation can’t always address big social problems like opioid addiction — or compensate victims.
Since the first opioid lawsuit was filed in California in 2014, more than 3,000 additional lawsuits have been brought by states, cities, counties and tribes. One key allegation is that the companies were not truthful about the addictive properties of opioids.
The plaintiffs’ lawyers hired by the various local governments also crafted a theory built around state and local public nuisance laws, which traditionally had been reserved for, say, loud noises or possession of dangerous animals. The idea was that communities had spent millions of dollars dealing with the opioid crisis and should be compensated by the companies that caused the “public nuisance” of opioid addiction.
In addition to the Oklahoma Supreme Court decision, a California state judge last month also tossed out a lawsuit based on the public nuisance theory. A number of companies have agreed to settle some of the public nuisance lawsuits for relatively low sums. Most recently, the pharmaceutical company Allergan agreed this week to pay New York State $200 million to resolve claims that it helped fuel the opioid epidemic.There will be more cases decided in 2022, including an ongoing lawsuit in Washington State against three large drug distributors.
At this stage of the litigation, it is impossible to know whether the nation’s courts will ultimately agree to expand the definition of public nuisance to include opioid addiction, or whether they will turn their thumbs down, allowing the companies to walk away. There is a decent chance the question will have to be resolved by the Supreme Court, which, given the makeup of the court, would not bode well for the plaintiffs.
For aficionados of high-stakes litigation, this legal 3-D chess can be pretty exciting. But how should others think about these kinds of lawsuits? Plaintiffs’ lawyers say that they step in to redress wrongs because, far too often, the government won’t — and because there is no other way to get compensation to victims. But critics contend that using class action suits is far from an ideal way to obtain justice. For one thing, they say, the potential multimillion-dollar fee is too often the main motivation for the lawyers. For another, the results are often uneven; one victim may reap millions from a court victory, while another gets nothing when a different court comes to a different conclusion. Sometimes companies that have done bad things get off the hook. Other times, companies pay tens of millions of dollars in damages even though the evidence of wrongdoing is exceedingly thin.
“Class-action suits are not useful instruments for redistributing income,” said Ted Marmor, a retired professor of public policy at Yale who has served as an expert witness for both plaintiffs and defendants. “A lot of times, these are regulatory failures more than corporate failures.”
Some examples: Few would dispute that BP’s $20 billion settlement with the Justice Department for its role in the Deepwater Horizon oil spill was warranted. But what about the 2007 Vioxx case, in which Merck paid close to $5 billion to settle lawsuits alleging that the pain medication Vioxx, a so-called Cox-2 inhibitor, had caused heart attacks in tens of thousands of users? Yet Pfizer, which marketed a Cox-2 inhibitor called Celebrex, continued to sell the drug, though the Food and Drug Administration had the company include a warning label that the drug “may cause an increased risk” of heart failure. (Years later, a clinical trial concluded that Celebrex was no riskier than either ibuprofen or naproxen.)
Then, there are the tobacco lawsuits of the mid-1990s. In those cases, plaintiffs’ lawyers hired by the states sued the big tobacco companies for having hidden the dangers of smoking and for contributing to health problems the states had to pay for. In 1998, the tobacco companies settled for an astonishing sum of money — at least $246 billion over 25 years. The result? The money, which was supposed to be used for anti-tobacco programs, is instead being used by most states to fill unrelated budget gaps. Meanwhile, the tobacco companies still make a product that kills some 480,000 Americans each year, according to the Centers for Disease Control and Prevention. And the plaintiffs’ lawyers who brought the case on behalf of the states got exceptionally rich; in Mississippi, Richard Scruggs’s firm alone was awarded $340 million as a fee.
Critics of the opioid litigation say it exemplifies all the problems that come with using lawsuits to fix big social issues. First, the reliance on a novel legal theory means there is no guarantee that plaintiffs will get a penny, much less millions. Second, even if the companies wind up paying billions, they will remain relatively unscathed. And opioids will continue to be legally prescribed drugs. On the other hand, if the plaintiffs lose, all this time and effort and money will have been for naught.
There is no question that bad actions had to take place to create the opioid crisis. Manufacturers like Purdue Pharma had to play down the addictive property of OxyContin. Distributors like Cardinal Health and McKesson had to flood communities with pills. Pharmacies had to sell the medication to addicts. But the government also played an important role by approving opioids and then looking the other way as they were being overprescribed and abused.
“The recent rulings underscore a more fundamental point repeatedly made by defendants in opioid litigation, as well as by many legal experts and at least one judge,” wrote the legal publication Law360 after the Oklahoma decision. “The executive and legislative branches have done relatively little to combat the crisis, essentially punting the issue to a U.S. court system that has difficulty dealing with large-scale product torts.”
Or, as the Oklahoma judges themselves put it last month, “Regulation of prescription opioids belongs to federal and state legislatures and their agencies.” In the end, the plaintiffs’ lawyers are stepping into a regulatory void. So long as that remains the case, money will continue to change hands between companies and plaintiffs, but the underlying problems will remain unsolved.
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