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Appeals Court Rejects Opioid ‘Negotiation Class’ Idea

— October 8, 2020

Appeals court will not allow novel framework in opioid litigation.

The federal 6th U.S. Circuit Court of Appeals voted 2-1 to overturn U.S. District Judge Dan Polster’s approval of a novel plan brought by attorneys representing thousands of plaintiffs in the consolidated opioid litigation.  Termed the “negotiation class” by attorneys representing the cities and counties in the case against opioid drug companies, they sought to have the class garner the power to vote on whether to accept any settlements proposed with the defendants.

On September 11, 2019 Polster certified for the first time the negotiation class in Re National Prescription Opiate Litigation, No. 1:17-MD-2804, 2019 U.S. Dist. LEXIS 155118 (N.D. Ohio Sept. 11, 2019).  Soon after, the appeals court considered four factors in determining whether to allow an appeal in the matter, according to court records: “(i) whether the case raises novel or unsettled question; (ii) the likelihood of the petitioner’s success on the merits; (iii) the costs of continuing litigation; and (iv) the posture of the case before the district court.”  In considering these facts, the court determined that whether the negotiation class is permitted under Rule 23 “is both novel and relevant to class litigation in general.”  Ultimately, the court decided against the proposed measure.

Appeals Court Rejects Opioid 'Negotiation Class' Idea
Photo by Gayatri Malhotra on Unsplash

Previously, Polster said, “There has to be some vehicle to resolve these lawsuits,” and in order to promote a global settlement, offered his approval.  He added, he has no interest in depositions and trials, adding, “People aren’t interested in figuring out the answer to interesting legal questions like pre-emption and learning intermediary, or unraveling complicated conspiracy theories…my objective is to do something meaningful to abate this crisis.  I’m confident we can do something to dramatically reduce the number of opioids that are being disseminated, manufactured and distributed.  Just dramatically reduce the quantity and make sure that the pills that are manufactured and distributed go to the right people and no one else.”

Joe Rice, one of the attorneys for the plaintiffs at the law firm Motley Rice, said, “The aim is to form a united group vested with the power to negotiate, vote on and deliver finality if there is an opportunity to negotiate a settlement.”

Under the plan, any settlement would need the support of at least 75% of class members.  Many defendants, including the drug distributors McKesson Corp, Cardinal Health Inc and AmerisourceBergen Corp, objected to the proposal from the start.  Many state attorneys general also argued that Polster’s ruling could “complicate settlement talks and interfere with states’ rights over their political subdivisions,” according to court records.

U.S. Circuit Judge Eric Clay said the federal rule governing class actions “does not authorize the framework.”  He wrote, “However well-intentioned the district court’s actions might be, the fact of the matter is that the court, when it certified the negotiation class, exercised power it did not have.”

The local governments’ lead attorneys, Paul Farrell, Paul Hanly, and Joe Rice, said they are in the process of coming up with alternative models that would allow companies to resolve the cases.


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