Weekly Mass Torts Bulletin 2022-Mar-28

Johnson & Johnson's (J&J) controversial bankruptcy move due to talc litigations will force the settlements for cancer victims, which will eventually result in the rest of the companies like 3M Co. and Dow Inc. following the same suit.

In February, a judge cleared J&J to use the legal bankruptcy move of Texas Two-Step, which is business-friendly. The move has shifted nearly 40,000 claims into a purposely created unit and has temporarily halted J&J's baby powder litigation.

Many legal experts stated that the ruling will stimulate other companies to implement a similar strategy to deal with the litigations. 3M is another company that faces similar product liability lawsuits over its earplugs designed for the military. J&J responded that the move was the only way to deal with the growing litigation costs. Attorneys for the cancer victims argued that the company is capable of paying settlements but has filed for bankruptcy to restrict the amount of settlement.

The court's decision to let J&J continue with bankruptcy is appealed by two victims groups. One of the groups said that the company's chapter 11 petition is not legitimate and was filed in a bad faith.

Other companies, including 3M, face 300,000 claims that are a part of an MDL with allegations of producing defective earplugs for the U.S. military. It is U.S.'s largest consolidated mass tort case. On the other hand, Dow Inc. faces more than 9,000 claims over accusations that its products cause cancer. Both the companies might follow the same strategy to dodge the growing litigations against them.

The U.S. Department of Labor has announced an award of $2.8M to provide employment and training services to deal with the opioid crisis in Ohio.

The money would be allotted to the National Dislocated Worker Grant that funds the Ohio Department of Job and Family Services, which employs people for the job to oversee the effects of the opioid crisis. The job positions include hospital support staff and peer recovery coaches who address the opioid addiction among newborn babies and increased drug-related admissions. It also provides social service aids to children placed in foster care due to parental substance abuse.

The opioid crisis has been a serious health emergency in Ohio as it has been recording a higher rate of newborns suffering from opioid abuse. Ohio reported 3,237 deaths from opioid-related overdoses in 2018 alone.

The Department of Health and Human Services declared the opioid crisis as a health emergency in October 2017. As per the estimates provided by the Centers for Disease Control and Prevention, Ohio recorded 49,860 opioid overdose deaths, which account for 70.6 percent of all drug overdose deaths.

Ohio has also received the award previously in May 2019 under a National Health Emergency Dislocated Worker Grant to continue the services. The project would be executed by the same 20 workforce development areas which provided services under the award offered earlier.

An opioid trial in Georgia state court against drug distributors brought by the families affected by opioid addiction has been delayed due to a lawyer conflict.

Most of the opioid trials against the companies allege that the public nuisance of the companies' opioid activities caused the opioid crisis, which has harmed communities. But the current trial stands out as it is brought against the company by 21 private plaintiffs who are mostly minors.

The complaint states that the companies were aware of the huge amount of opioids being distributed in the county for profits from the illegal drug market. The defendant companies in the lawsuit are Cardinal Health, McKesson, pharmacies and other related groups. The plaintiffs include children, spouses, siblings and parents of opioid-addicted people along with people seeking compensation due to opioid harm. The dealers of illegal drugs are held responsible in the suit under the Georgia Drug Dealer Liability Act.

The plaintiffs' attorney said that it is the first case of such kind that falls under the drug dealer law. The attorney even stated that it is uncertain to tell when the trial might start.

The trial of the suit was slated to start on March 21 but has got postponed. Another opioid trial by the state of Rhode Island ended in a $100 million settlement to be paid by the drug distributors and manufacturers.

Teva Pharmaceuticals and its several affiliates have agreed on a settlement worth more than $100 million with Rhode Island over the company's role in the opioid crisis.

The settlement would even include $28.5 million in cash along with drug donations to treat opioid addiction. The deal will end the claims brought by Rhode Island against Teva, which allege that the company marketed the benefits of opioids and downplayed the risks.

Rhode Island's Attorney General Peter F. Neronha stated that no settlement amount would reverse the adverse effects of opioids on the state and its communities but will surely help to set up recovery programs and deal with the crisis. The AG even notified that Teva has agreed to supply enough Naloxone for the next 10 years at no cost to deal with the opioid epidemic. Naloxone is a medication used to reverse the effects of opioids.

As per the agreement, Teva will pay $28.5 million to the state for 13 years. It will also provide 50,000 kits of overdose medication Naloxone every year. The drugmaker will even supply Suboxone worth $16 million, which is used to treat the opioid disorder.

The spokesperson for Teva informed that the settlement is in the best interest of those who are affected by the opioid crisis. The company even stated it does not admit to any liability of wrongdoing even though the company has agreed on a settlement and will continue to defend itself in court.

New Jersey is all set to join the $26 billion nationwide opioid settlement, which will reward the state with $641 million for the opioid crisis faced by its people and communities.

The settlement was announced in July 2021 and involves drug manufacturer Johnson & Johnson (J&J) along with major pharmaceutical distributors of opioids, namely McKesson, Cardinal Health, and AmerisourceBergen.

Officials representing the state informed that the compensation amount would be used to conduct programs to reduce, treat and prevent the drug crisis. The amount would be evenly split with 50% for the state ad 50% for the individual municipalities across New Jersey.

As per the agreement, the four companies will collectively pay $21 billion over the next 18 years. On the other hand, J&J will pay up to $5 billion over the next nine years. The agreement even prohibits the companies from manufacturing and selling opioids. It has even refrained J&J from funding third-party companies that might sell opioids.

According to the National Center for Health Statistics, the United States reported nearly one million overdose deaths since the beginning of the opioid crisis. The data even reveals that April 2020 to April 2021 recorded nearly 100,000 fatal overdoses. New Jersey reported 2,896 overdose deaths from January 2021 to November 2021.

Earlier, the drug companies even informed that they might use certain tax benefits for their settlement expenses of $26 billion.