FARGO — North Dakota is one of more than a dozen states moving to sideline local governments in federal claims against opioid manufacturers and marketers in litigation putting billions of dollars in damages at stake.
Wayne Stenehjem, the North Dakota attorney general, joined fellow attorneys general from 12 other states and the District of Columbia in siding with the Ohio attorney general, who is seeking to put federal litigation by more than 2,000 cities, counties and tribal governments on hold.
The states-vs.-cities-and-counties dispute is playing out in U.S. District Court in Ohio, where cases brought against opioid defendants by the local governments have been consolidated for expedited handling.
Ohio and like-minded states, which include South Dakota but not Minnesota, argue that state sovereignty means states should take the lead in the opioid litigation on behalf of local governments as well as the states themselves.
Many counties and cities in North Dakota and Minnesota, as well as almost all states, are suing to recover damages for the ongoing costs — including addiction treatment programs, public health, law enforcement and corrections — of dealing with the opioid epidemic.
Last year, Stenehjem tried to persuade local governments in North Dakota to rely on state litigation against opioid manufacturers and marketers. Cass County decided to pursue its own lawsuit, together with the city of Grand Forks, separately.
The city of Fargo initially deferred to the state, but filed its own lawsuit in July, after a judge in Bismarck dismissed the state’s lawsuit in May, a decision the state is appealing.
Allowing states to handle the lawsuits would have avoided the mass litigation now pending, with more than 2,300 local governments suing, Stenehjem said. That legal jumble makes it more difficult to try or settle the cases, he added.
Also, state attorneys general, through state consumer fraud protection laws, have legal tools not available to local governments, Stenehjem said.Fraudulent claims about the safety and effectiveness of opioid painkillers is a major component in the lawsuits against Purdue Pharma, a leading opioid manufacturer, he said.
“They sent out an army of salesmen with phony studies,” Stenehjem said. “They promoted it as safe.”Erik Johnson, Fargo’s city attorney, agreed with Stenehjem’s assertion that the state was best equipped to bring the lawsuit. The city filed its own suit only after the state’s case was dismissed, he said.
“We’re still very supportive of the state action but have to look after the constituents’ interests,” Johnson said.
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Although it’s unusual for North Dakota and other states to try to claim they have the authority as “chief guardians of the health and safety of their citizens” over local governments, he said, the massive damages caused by the opioid epidemic and the common issues among so many jurisdictions also is unusual.
The only thing comparable in recent memory was likely the tobacco litigation and settlement by state attorneys general roughly 20 years ago, Johnson said.
In fact, lingering resentment over the fact that local governments received little or no money from the tobacco settlement is one reason so many cities and counties are filing their own opioid lawsuits, a plaintiff’s lawyer who represents many North Dakota and Minnesota local governments said.
“Every county feels they got the raw end of the deal on tobacco litigation,” said Jonathan Novak, a lawyer in Dallas whose firm represents 25 counties and three cities in North Dakota, including Burleigh County and Bismarck, but not Fargo or Cass County.
“All these years later, they’re still angry about that,” he said.
Also, Novak said, states tend to sue to recover Medicaid expenditures, while cities and counties are suing to recover different costs, such as local police or public health.
“With counties and cities we’re looking at what the direct cost has been that comes out of the coffers of the cities and counties,” he said.
The dispute between some states and their cities and counties over the opioid litigation is unnecessary, Novak said. The claims will be resolved for billions of dollars.
“When this all shakes out this will be the largest settlement or the largest verdict in the American civil justice system,” he said.Stenehjem is aware of local governments’ complaints about the tobacco settlement, and said he has promised that money the state recovers will be spent on treating addicts, something all state and local governments agree is a priority.
Birch Burdick, the Cass County state’s attorney, said county commissioners’ sole reason for suing is to get money for drug recovery programs. He said the county and state have similar aims, but the county was disappointed with the outcome of the tobacco settlement years ago.
North Dakota, Minnesota and most other suing states are pursuing their lawsuits in state court, while cities, counties and tribes are suing in federal court, individually or in groups. In appealing the dismissal of North Dakota’s lawsuit, Stenehjem’s office is arguing that the trial judge erred in several ways.
Dismissal of the North Dakota case — the only state to have its entire lawsuit rejected by a judge — has been cited in the federal litigation by lawyers representing some opioid manufacturers.
But the federal judge who is hearing the consolidated opioid case in Ohio rejected the North Dakota trial judge’s decision, including a determination that federal law preempts state law in such claims, which the federal judge said was “by leaps and bounds, an outlier on the question of preemption.”