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Authorization for County Attorney to Execute Settlement Participation Agreements With Six Opioid Distributor/Dispenser Defendants Regarding Opioid Litigation
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BRIEF OVERVIEW
I. The Litigation
On January 29, 2019, the Board of County Commissioners selected a litigation team consisting of numerous nationally renowned law firms including Podhurst Orseck, P.A.; Levin, Papantonio, Thomas, Mitchell, Rafferty & Proctor, PA; Baron & Budd, PC; Greene, Ketchum, Farrell, Bailey & Tweet, LLP; McHugh Fuller Law Group, PLLC; Hill, Peterson, Carper, Bee & Dietzler, PLLC; Powell & Majestro, PLLC., and the Law Office of Lucas Magazine (collectively, “Levin”) as outside counsel to represent the County with regard to opioid litigation.
On June 6, 2019, the County Attorney's Office and Levin filed a federal lawsuit for damages on Hernando County’s behalf against several participants in the opioid industry. The County filed its suit in the Middle District of Florida, but it was subsequently transferred to become part of the multi-district litigation (“MDL”) case pending in the Northern District of Ohio (case no. 1:17-md-2804).
(An MDL is a federal legal procedure that is designed to consolidate complex cases that involve similar legal issues before one court for all discovery and pretrial proceedings. The goal of an MDL is to expedite proceedings, conserve resources, and foster consistent court rulings across different lawsuits. The Opioid MDL is the largest such proceeding in U.S. history, and it has been described as the most complex civil litigation in U.S. history. Although the case is currently in the Northern District of Ohio, if it does not settle it will be tried in the Middle District of Florida.)
Amongst the defendants that Hernando County sued, six “remnant” opioid distributor/dispenser defendants remain: Associated Pharmacies, Inc. (and American Associated Pharmacies); JM Smith Co.; Morris and Dickson; Louisiana Wholesale Drug Company, Inc.; North Carolina Wholesale Drug Company, Inc.; and UNFI/SuperValu (the “Distributors”).
II. The Proposed Settlements
A committee of plaintiffs recently reached a settlement with the Remnant Distributors.
If effected, the proposed Distributor Defendants’ settlement will result in the six defendants paying a combined $97,625,000.00 in cash for purposes of abating the opioid epidemic. An Eligible Entity’s participation in the proposed settlement will result in a one-time settlement payment to each Eligible Entity. The Settlement funds must be used for the Core Strategies and Approved Uses set forth in Exhibit D of the proposed settlement agreement.
Pursuant to Exhibit E of the proposed settlement agreement, Hernando County will receive 0.1132403658% of the total settlement amount of $97,625,000.00, or approximately $110,550.91. The exact schedule of payments that Hernando County will receive if it approves the settlements, however, is not yet known.
III. Recommendation
Hernando County’s counsel recommends that Hernando County participate in the above-described settlements.
IV. Authorization for County Attorney to E-Sign Participation Agreements
To participate in the settlements, Hernando County must e-sign the applicable participation forms. This agenda item asks the Board of County Commissioners to authorize the County Attorney to e-sign the participation forms. (NOTE: Because of its size, the proposed settlement agreements are available for viewing upon request only.)
FINANCIAL IMPACT
Participating in the settlements includes the cost to participate in the applicable process, both actual costs not recovered as part of the process and the opportunity cost associated with any time spent on the settlement by the County Attorney’s office; however, those costs also bring the potential for settlement funds to provide additional resources to Hernando County to offer programs and services to assist those that have been negatively impacted by Opioid Products. The dollar amounts above are substantial and the County Attorney’s office recommends joining the settlement.
LEGAL NOTE
The Board has the authority to approve this Agenda Item pursuant to Fla. Stat. § 125.01.
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RECOMMENDATION
It is recommended by Hernando County’s opioid counsel that the Board approve this agenda item as outlined above.