Time running out for lawyers suing opioid industry to show specific proof

By Daniel Fisher | Oct 20, 2018

CLEVELAND (Legal Newsline) - The judge overseeing multidistrict litigation against the opioid industry has given plaintiffs a stark choice on a tight deadline: Hand over evidence of specific prescriptions they believe were improper or lose the right to present such evidence forever.

The ruling this week by U.S. District Judge Dan Aaron Polster comes after months of wrangling between plaintiffs and defendants over prescription-level data the defendants say they need to prepare for a set of bellwether trials set for early next year. The judge, in an Oct. 16 order, gave the plaintiffs until Monday to turn over hundreds of prescription records or abandon the right to present any evidence of specific prescriptions they claim were “unauthorized, medically unnecessary, ineffective, or harmful.”

If the plaintiffs choose not to turn over the records, they will be restricted to “aggregate proof,” using experts and sales records to show the defendant companies distributed more pills than were medically necessary and that the excess can be attributed to their marketing practices and lack of care in controlling illegal diversion.

The plaintiffs in the bellwether cases – the City of Cleveland and two Ohio counties – claim they have shouldered huge expenses due to excessive use of prescription opioids. In pretrial jousting, manufacturers, distributors and pharmacists say they are entitled to see which prescriptions, exactly, were medically unnecessary or downright illegal. The manufacturer defendants alone have turned over 68 million pages of documents, but the plaintiffs have refused to comply with discovery requests for prescription-level data, saying it is unnecessary.

In an Oct. 6 order, Special Master David R. Cohen said the plaintiffs have to turn over some prescription data but not all. He ordered them to supply at least 500 prescriptions per plaintiff, plus identifying at least 300 individuals who became addicted to prescription opioids. The plaintiffs objected to this order and Judge Polster, in the most recent order, gave them the alternate choice of forgoing prescription data entirely.

“They are fighting about what type of proof plaintiffs will have to provide at trial, which, in turn, could affect how the case gets resolved,” said Elizabeth Burch, a professor at the University of Georgia Law School who studies MDLs.  

The plaintiffs are arguing the focus should be on misrepresentations and other improper behavior by manufacturers, distributors and pharmacies, she said, while the defendants say the plaintiffs should be required to provide evidence of people who received prescriptions they shouldn’t have. 

One potential solution to the litigation would be to form a class to decide the question of liability over marketing practices, Burch said, but neither side might want to risk it at this stage given the tens of billions of dollars at stake. Plaintiff lawyers at a conference last month said Cohen is investigating the possibility of a mandatory class procedure to settle claims, although that would be unprecedented in a case with so many plaintiffs and different types of defendants.

If plaintiffs choose aggregate proof, it could shift the focus of the litigation to specific industry practices that allegedly caused the opioid crisis, rather than specific allegations of wrongdoing in the chain of distribution. That could benefit distributors and pharmacies, since one of the central allegations in these lawsuits is that opioid manufacturers used false and misleading marketing tactics to convince doctors that new formulations of opioids were non-addicting and safe to prescribe for treating chronic pain. 

To drag pharmacies and distributors into the scheme, plaintiffs will have to show they facilitated the flow of illegal and medically unnecessary pills into the marketplace. But without any evidence of specific prescriptions they allege were improper, the plaintiffs will have to rely on experts who say the distributors and pharmacists knew or should have known a significant number of pills were winding up in the wrong hands. 

The defendants say they operated under a tightly regulated system where the Drug Enforcement Administration set production levels and tracked each pill from the factory to the retail pharmacy. 

Some of the plaintiffs had said in their complaints they will cite “particular prescriptions, patients or doctors” at trial, but have refused to provide any discovery on those details.

The pharmacy defendants, in a court filing, said “there can be no serious dispute” that they are “entitled to know which prescriptions Plaintiffs had in mind when they made serious allegations about misconduct they say contributed to significant harm to the citizens of Cuyahoga and Summit counties.”

Even if the plaintiffs use aggregate or statistical data, the pharmacy defendants said, that analysis “would still need to be based on data of some kind,” including prescriptions. Indeed, “unless the plaintiffs mean to confess a violation of Rule 11,” which prohibits filing baseless lawsuits, “they must have had some evidence in hand before filing their complaints.”

Some MDL judges have used aggregate proof to establish liability for a common course of conduct among multiple defendants. It is also not unknown for courts to hold multiple companies liable for selling the same product, without forcing plaintiffs to identify which company’s product caused their injuries.

A national MDL over the gasoline additive MTBE is one example. Gasoline refiners started adding MTBE to their fuels in the late 1970s as a replacement fuel oxygenate for lead. Unfortunately, MTBE is much more prone to migrating underground than the other components of gasoline and it soon was leaching out of filling-station tanks into underground aquifers.

The MDL court rejected most of the same defenses the opioid manufacturers have raised, including preemption – the refiners said the Environmental Protection Agency required them to replace lead with MTBE – and lack of causation because individual gas station owners were responsible for the leaks. The court found that the refiners had alternatives to MTBE and knew or should have known the additive would cause widespread pollution given the well-known tendency of underground gasoline tanks to leak.

Most ominously for the manufacturers and distributors, the MTBE court found that the additive was fungible, tended to be mixed repeatedly during shipping and distribution and thus was impossible to trace to any single supplier. So the court came up with a new theory of “collective liability,” under which defendant companies were presumed liable for MTBE pollution unless they could prove they didn’t supply any of the material at issue in a given case. As with most MDL cases, the vast majority of MTBE lawsuits settled, with the parties using market-share approach to apportioning liability. 

One case that did go to trial, in New Hampshire, ended with a $235 million verdict against ExxonMobil based on market-share calculations, not evidence the refiner was the specific supplier of the MTBE at issue. The New Hampshire Supreme Court upheld the verdict and the U.S. Supreme Court declined to hear an appeal. In language that could come to haunt the opioid defendants, the New Hampshire high court said it would be unfair to allow lawsuits in which the defendant’s products could be identified but reject them “where the conduct alleged may be part of group activity which is alleged [to] have led to a common, and more deleterious, result.”

The opioid manufacturers and distributors may have an advantage over MTBE producers because the Drug Enforcement Administration has records on every single opioid pill from factory to retail pharmacy. But given the huge financial stakes and pressure to settle, they are likely to arrive at a similar formula as the MTBE producers, with companies paying according to their share of the market.

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New Hampshire Supreme Court Purdue Pharma L.P U.S. District Court for the Northern District of Ohio Cleveland Division

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