CLEVELAND (Legal Newsline) - The judge overseeing multidistrict litigation against opioid manufacturers and distributors has named the teams of lawyers who will try to negotiate a settlement of hundreds of federal lawsuits - a complex task given parallel investigations and litigation by state attorneys general and potentially conflicting goals of private attorneys and their government counterparts.

In a second order this week, U.S. District Judge Dan Aaron Polster then warned everybody involved to “maintain strict confidentiality” about settlement discussions. Attorneys can confirm they’ve met, Polster said, “but nobody is to disclose to the media or any other outside party the contents of the discussions, or to provide the media assessments or commentary regarding those discussions.”

There were no surprises in the negotiating teams, which largely mirrored Judge Polster’s earlier appointment of lead counsel. For the plaintiffs  – more than 200 towns, cities, counties and other entities including union pension funds – Polster appointed Joe Rice, of Motley Rice; Paul Hanly of Simmons Hanly Conroy; Elizabeth Cabraser of Lieff Cabraser; Troy Rafferty of Levin Papantonio; Paul Geller of Robbins Geller; Chris Seeger of Seeger Weiss; and Russell Budd of Baron & Budd.

Judge Polster said he selected the negotiating teams in response to requests from the attorneys on both sides. All of the plaintiff lawyers represent firms already named as lead counsel in the judge’s earlier order. The negotiating team doesn’t include a representative of Morgan & Morgan, the Florida firm that objected to a proposed leadership team in December but was later included as part of the executive committee.

In its December objection, Morgan & Morgan described a first attempt by MDL plaintiff attorneys to select their own leaders as “a scripted performance” in which a self-appointed group of lawyers “unilaterally announced and unveiled the pre-ordained proposed slate they had internally chose in some undisclosed manner.”

For the manufacturers’ team, Judge Polster named a collection of well-known defense litigators in product liability and false claims cases: Sheila Birnbaum of Quinn Emmanuel, Steven Reed of Morgan Lewis, Charles C. Lifland of O’Melveny & Myers, Jonathan Stern of Arnold & Porter, Mark Filip of Kirkland Ellis, Brien T. O’Connor of Ropes & Gray and J. Matthew Donohue of Holland & Knight. 

For the distributors he named Enu Mainigi of Williams & Connolly, Geoffrey Hobart of Covington & Burling, Jack Smith of Flaherty, Sensabaugh & Bonasso, and Robert Nicholas of Reed Smith.

The judge also named representatives for two groups of attorneys general who are investigating and suing the opioid industry. For the multistate group of 41 states that is coordinating an investigation into the sale and distribution of opioids, he named Jennifer Peacock of the Tennessee AG’s office. For the smaller group of states that have already sued the industry, he named Tad Robinson O’Neill of the Washington AG’s office.

The orders reflect Polster’s clearly stated goal of achieving a global settlement of opioid claims which, in his words, “dramatically reduce the number of opioids that are being disseminated, manufactured and distributed.” 

One complication is that as a federal judge, he has no power over state AGs and a limited ability to influence state court litigation. But since the same plaintiff lawyers are involved in state and federal cases, they have a strong financial incentive to strike a bargain that ends all litigation and rewards them with a percentage of the recovery in fees.

Plaintiff lawyers no doubt wish to recreate the success of the multistate settlement with the tobacco industry in 1998, in which private lawyers operating under contingency fee contracts with the states won more than $10 billion in fees. 

Such an outcome in this case might be difficult, however, given the relatively small sales revenue of opioid manufacturers and the fact their products were legally sold only by a doctor’s prescription. The lawyers are likely to focus on larger and better capitalized distributors including McKesson and Cardinal Health, using evidence they are trying to obtain from the Drug Enforcement Administration showing millions of pills were shipped to tiny towns where the population couldn’t possibly justify the demand.

Settlement discussions also may be complicated by the fact the manufacturers and distributors will seek an injunctive solution, such as stricter controls on how the drugs are dispensed. That may mesh with the goals of state and federal officials, but won’t yield the fees private lawyers are entitled to under their contracts with cities and counties.

The parties held their first settlement conference in Polster’s Cleveland courtroom on Jan. 31. The next settlement conference is scheduled for March 6.  

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