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Tuesday, October 22, 2019

Oklahoma governor, AG resolve dispute over where $85M from opioid settlement should go


By John Sammon | Jun 25, 2019


NORMAN, Okla. (Legal Newsline) – An Oklahoma judge announced on Monday agreement has been reached between feuding government officials on how an $85 million settlement with opioid drug maker Teva Pharmaceutical Co. would be apportioned.

“The motion to intervene has been withdrawn,” said Cleveland County District Judge Thad Balkman. “The governor, the attorney general, the Senate have settled their differences. The governor and Legislature are withdrawing their motion to intervene and agree to the payment structure. The state and Teva have amended their documents.”

The judge’s statement came during a break in a trial in which the state is suing Johnson & Johnson accusing the company of causing an opioid crisis in Oklahoma.

The trial is being streamed live courtesy of Courtroom View Network.

Under the agreement Teva admits to no wrongdoing, but agreed to help law officers investigate cases of drug diversion and criminality according to a San Francisco Chronicle report. Attorneys will receive $13 million of the settlement money.

Balkman said the agreement does not release Teva from separate claims brought by Oklahoma cities and counties. Nine Oklahoma cities have filed suit against Teva and other opioid manufacturers.

The remainder of the money will be put into the state treasury in its Opioid Lawsuit Fund.

Teva, based in Israel, a producer of opioid drugs, agreed in May to the $85 million settlement with the State of Oklahoma over its alleged role in fueling the opioid crisis. Teva officials said they were innocent of wrongdoing. 

Purdue Pharma, of Connecticut, the maker of the opioid drug OxyContin, also agreed to settle with the state for $272 million in March.

That left Johnson & Johnson and its opioid drug-manufacturing arm Janssen Pharmaceuticals as the sole defendant in the trial currently underway in Norman.

The action resolves a source of conflict earlier this month.    

Oklahoma Gov. Kevin Stitt, Speaker of the House Charles McCall and Greg Treat,  president pro tempore of the state Senate, filed a court request on June 14 to intervene in the Teva settlement after expressing worry the money would not be put in the state treasury, in violation of a newly amended state law. 

The three were reportedly upset by the earlier disbursement of Purdue settlement funds parceled out by Oklahoma Attorney General Mike Hunter. Purdue agreed to pay $200 million into an Oklahoma State University center for addiction treatment, $12.5 million to local governments to abate the epidemic in Oklahoma cities and counties, and $60 million to private lawyers who were entitled to a percentage of any recovery under their contract with the state. Hunter is an OSU grad.

The money going to OSU was earmarked toward treating the ongoing addiction epidemic nationwide. The university will start with an initial $102.5 million; then receive $15 million per year for the next five years. Another $20 million in medicines will be provided.

A search of Oklahoma Ethics Commission records showed that lawyers hired in 2017 gave more than $95,000 to Hunter’s election campaign. The firms chosen by Hunter were Whitten Burrage, Nix Patterson and Glenn Coffee & Associates. The first two firms are pursuing the current suit against Johnson & Johnson for the state. Hunter earlier called Michael Burrage and Reggie Whitten “great Oklahomans” with track records of success.

Contracts with outside attorneys are exempt from competitive bidding, according to Hunter's office.

In May, Stitt signed into law HB 2751 with added emergency language mandating that funds from lawsuits involving the State of Oklahoma and settled by its attorney general go first into the state treasury so lawmakers could decide how it should be spent.The intervention filing said Hunter's $85 million settlement agreement with Teva could violate the amended state law if the money was dolled out differently.   

Under current Oklahoma laws the state treasurer is supposed to receive all fines, fees, forfeitures and costs received by any state officer. The Oklahoma Constitution says, “no money shall be paid out of the treasury except in pursuance of an appropriation by law.”

Hunter is a Republican, as are Stitt, McCall and Treat.

Hunter said the resources from the Teva settlement would help the state abate the ongoing opioid drug crisis.

“It helps prevent doctors and Oklahomans from being misled by marketing materials and provides law enforcement with another investigative tool to help us shut down pill mills and illicit enterprises," Hunter said in a statement.

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Organizations in this Story

Johnson & Johnson Oklahoma Attorney General's Office Purdue Pharma L.P Teva Pharmaceuticals

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