Trials & Litigation

Federal judge appears likely to certify unusual 'negotiation' class for nation's cities in massive opioid case

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A federal judge in Cleveland appears ready to approve a “negotiation” class representing the nation’s 33,000 cities, towns and counties to try to achieve a settlement in opioid litigation.

U.S. District Judge Dan Polster seemed receptive to the unusual idea in a hearing Tuesday, report, Courthouse News Service and Reuters. The New York Times had coverage in advance of the hearing.

The idea mulled by Polster was proposed in a draft 2019 law review article by Duke University law professor Francis McGovern and Harvard law professor William Rubenstein, according to McGovern is a special master in the opioid case, and Rubenstein is a class action expert McGovern hired as a consultant in settlement negotiations.

Nearly 2,000 cases already filed by municipalities are before Polster, and those plaintiffs are seeking the negotiation class. Defendants in the opioid litigation include opioid manufacturers, drug distributors and pharmacy chains.

The idea is unusual because the class would be certified for negotiation, rather than litigation. The proposal could help protect against an unfair settlement that is reached by lawyers before approval by the class, proponents say. Every town and city would be allowed to vote on settlement offers, if they do not opt out of the class. Municipalities remaining in the litigation that are affected by the opioid crisis would get part of any settlement, according to the proposal before Polster.

The settlement would have to be approved by a supermajority of more than 75% of the voting class members. Each entity would be weighted by population, Courthouse News Service explains.

The cities and counties would be able to see their potential allocation in a settlement by reviewing an online settlement allocation map and calculator that uses a formula to determine harm. The formula takes into account federal data on overdose deaths, cases of opioid use disorder, and volume of opioid pills.

Thirty-nine state attorneys general have objected to the idea of a negotiation class that would represent cities and towns, according to and the New York Times. (Other stories have slightly different counts on the number of objecting attorneys general.)

The state attorneys general argue that they are best positioned to achieve a high-impact settlement. They also argue that the novel idea of a negotiation class is likely to lead to appeals and delays in settlement payments.

Some cities and counties think a negotiation class would help avoid problems with distribution of money that occurred after the 1998 tobacco settlement. Forty-six states recovered money in that settlement, but much of the money went to discretionary funds of state legislatures, the New York Times explains. Tobacco settlement money often went to help balance state budgets and fix potholes, rather than to local communities’ prevention and treatment programs, the New York Times reports.

See also:

ABA Journal: “Opioids, justice & mercy: Courts are on the front lines of a lethal crisis” “In ‘unorthodox’ strategy, Arizona files suit against opioid company owners directly with Supreme Court”

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