States and Cities Near Tentative $26 Billion Deal in Opioids Cases

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Johnson & Johnson, and other manufacturers, are on trial in California state court and just settled with the state of New York and two New York counties last month, on the eve of trial. The money for the New York settlement, $230 million, will be paid over nine years with an additional $33 million for lawyers’ costs and fees, that will be deducted from the national amount, if finalized.

Indeed one sticking point for years was attorneys’ fees. Innumerable lawyers contributed different amounts of work and during negotiations, they would fight with each other over who should get paid how much. According to the settlement, about $1.6 billion in fees and costs would be paid to private lawyers representing thousands of counties and municipalities, $50 million in costs, and about $350 million to private lawyers who worked for states.

Johnson & Johnson, widely known as a company that prefers to take cases to trial rather than settle, has faced rivers of adverse publicity in recent years. Last month, the United States Supreme Court let stand a $2.1 billion verdict against the company for asbestos deaths related to its talcum powder. The company was also battered by reports of rare cases of blood clotting and a neurological condition associated with its single-dose Covid vaccine and a recall of some of its sunscreens.

But plaintiffs also faced increasing pressure to settle, as legal costs mounted.

And most urgently, so did the numbers of people addicted to prescription opioid and street drugs during the pandemic. Last week, the federal government announced that 2020 saw a record number of overdose deaths from opioids, both illegal and prescribed.

Notably, the settlement funds are not intended to compensate families of the victims of the two-decade-long opioid crisis, during which at least 500,000 people died from overdoses of prescription and street opioids, according to federal data.

These cases were brought largely by state, municipal and tribal governments under a theory known as “public nuisance” — that the opioid supply chain companies were responsible for creating a disaster that interfered with public health. The remedy for a public nuisance claim is “abatement” — money for programs to reduce the “nuisance.”

While critics of the current settlement argue that the distributors have a leisurely 17 years to pony up their share, the deal’s defenders note that for programs like addiction prevention, education and treatment to take root, infusions of cash will be needed over a sustained period.

Sarah Maslin Nir contributed reporting.