CLEVELAND (Legal Newsline) - The judge overseeing federal multidistrict litigation against the opioid industry ordered Walgreens, Walmart and CVS to pay $651 million to fund what he called an “abatement” plan to reduce the level of opioid addiction and overdose deaths in two Ohio counties.
Citing his powers to craft a solution through the legal process known as equity, U.S. District Judge Dan Aaron Polster decided the three pharmacy chains were responsible for a third of the harm in Lake and Trumbull Counties and must fund a 15-year abatement plan he designed and will oversee.
The judge waved aside objections by the pharmacy chains that none of them had more than 25% market share in either county and other actors, including pill-mill pharmacies, corrupt doctors and illegal fentanyl dealers, bore far more of the blame for the opioid crisis. Judge Polster blamed the defendants themselves for failing to provide him with a “realistic” abatement plan, which he said meant his “only real choice” was adopting the plan devised by plaintiff experts.
The huge award equals more than $1,500 per person in the two counties. If extrapolated nationwide would mean the three pharmacy chains could be liable for more than $450 billion in so-called “abatement” costs.
All three companies said they will appeal. Walmart said the ruling was “engineered to favor the plaintiffs’ attorneys and was riddled with remarkable legal and factual mistakes.”
“Instead of addressing the real causes of the opioid crisis, like pill mill doctors, illegal drugs and regulators asleep at the switch, plaintiffs’ lawyers wrongly claimed that pharmacists must second-guess doctors in a way the law never intended and many federal and state health regulators say interferes with the doctor-patient relationship,” Walmart said.
The decision was hardly a surprise, since Judge Polster told all parties soon after he took charge of the MDL that he wasn’t interested in trials but wanted to “to do something meaningful to abate this crisis,” not to “figure out the answer to . . . legal questions.” He scheduled the bellwether trial against the pharmacy chains after they refused his suggestions they settle, once even threatening the defendants with bankruptcy if they refused. He stripped other potential defendants from the case, including doctors who wrote improper prescriptions and local pharmacies that filled large numbers of improper prescriptions.
After a jury found the three defendants for causing a public nuisance by filling too many prescriptions, Judge Polster assigned himself the job of calculating damages, which he characterized as “abatement costs” to fit within the legal powers of a judge acting in equity.
The term “equity” usually refers to issuing injunctions and other court orders requiring defendants to do or cease doing something, but Judge Polster adopted an especially expansive definition. He said his authority expanded “to fit the size of whatever problem is properly before the court with equity powers.” The judge balked at the plaintiff experts’ estimate of $3 billion, however, which he said “is unrealistic because it asks for the sun and the moon.”
“There is no way this court would enter such a blue-sky order, nor any likelihood the Sixth Circuit would ever affirm it,” he wrote, instead performing a “line-by-line audit” to arrive at his own calculation of what the pharmacies owed. He cut the overall responsibility of all industry defendants to 60%, reflecting the percentage of opioid users who never abused prescription drugs, then reduced the pharmacies’ share to a third to reflect the liability of opioid manufacturers and distributors.
The pharmacies insisted the only valid abatement plan would be to operate drug-disposal programs for residents of the two counties to get rid of unneeded opioid prescriptions. The judge accused them of squandering the opportunity “to propose a meaningful plan to abate the nuisance.” He suggested their intransigence means they “effectively forfeited any right to assert on appeal” that his plan “would be ineffective, or should include any element or aspect not suggested” by the plaintiffs.
Large parts of the order were based upon the reasoning of a California appeals court that ordered ConAgra and other lead paint suppliers to pay more than $1 billion into a fund that would pay landlords to remove lead paint from rental properties. The California Supreme Court declined to review that decision, however, and the defendants settled for $305 million before it could be appealed any further. The judge also relied upon an Ohio Supreme Court decision allowing a public-nuisance lawsuit to proceed against the gunmaker Beretta, although similar cases failed in Chicago and other cities.
If defendants appeal, they will likely focus on the sweeping powers Judge Polster assigned to himself. Judges can’t award damages in equity, and Judge Polster wrote an extensive explanation of why the $650.5 million in cash, which is to paid to the two counties in 14 installments, is “abatement” or “prefunding,” not damages. They may also challenge the judge’s calculations, which deviate substantially from the evidence presented to him by either side.
The judge admitted there were limits to his power to order “abatement,” but said he was well within them. “A nuisance that can only be abated by the expenditure of an astronomical amount of money or effort is effectively unabatable, and thus is a permanent nuisance, for which the only remedy is damages,” he said. But the opioid crisis wasn’t that, he went on, describing as “reasonable” a plan plaintiff experts said would reduce opioid use disorder in the two counties by 50%.
As he had previously, Judge Polster mentioned the stress of the job he undertook.
“Given the scope of the entire MDL and the enormity of the stakes, there are days the court feels inadequate to meet the task. The court gathers strength, however, from an ancient aphorism: `You are not obligated to complete the work, but neither are you free to desist from it.” He said he hoped his $650.5 million order “will help the parties and the nation come to a quicker `completion of the work.’”