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Plaintiffs lawyers leading lawsuits brought over the opioid crisis have filed a motion to certify an expansive class of various governments in preparation for a nationwide settlement.

In a motion for class certification filed Friday, lawyers sought to have a federal judge who is overseeing more than 1,800 lawsuits by cities, counties and other governments over the opioid crisis, approve an unprecedented “negotiation class” for the “sole purpose of negotiating and potentially settling with defendants conducting nationwide opioids manufacturing, sales, or distribution.”

They suggested a June 24 hearing for preliminary approval of the class, with final approval sometime in September.

The motion excludes state attorneys general, some of whom have brought lawsuits in state courts across the country, and sets up a procedure in which 24,500 cities, counties and other smaller governments could resolve their claims. It comes two days after Alabama Attorney General Steve Marshall voluntarily dismissed the state's case in federal court and as Oklahoma Attorney General Mike Hunter is in the midst of the first opioid trial in the nation against manufacturer Johnson & Johnson.

The motion also comes as U.S. District Judge Dan Polster of the Northern District of Ohio has pushed for global settlement talks while setting the first trial in the MDL for Oct. 21.

“This precise vehicle has never been used before, but we are very confident that this is a valid use of the procedure and that the court will, we are hopeful, welcome this as an opportunity to move the resolution of these cases forward,” said co-lead plaintiffs attorney Paul Hanly of Simmons Hanly Conroy in New York.

The move is also designed to provide some assurances to defendants—manufacturers and distributors of the prescription painkillers, as well as pharmacies—about the total scope of lawsuits that are out there.

“Negotiations have been ongoing for a number of months,” Hanly said, “but there are no offers on the table, and we hope that this vehicle will move us in the direction where defendants will begin to put offers on the table.”

But Adam Zimmerman, a professor at Loyola Law School in Los Angeles, said such a detailed proposal could indicate that defendants are closer to a settlement. Two of them, Insys Therapeutics and Purdue Pharma, have already reached settlements with the state of Oklahoma and the U.S. Department of Justice.

“Maybe this is a signal that some of the defendants, maybe Purdue, might be willing to enter negotiations under conditions like this,” he said.

An Unprecedented Idea

Joe Rice, another co-lead plaintiffs' attorney and partner at Motley Rice, in a blog post, called the deal “innovative” and a “powerful voice” for the multitude of governments, most of which have not filed lawsuits over opioids.

“Imagine you have a legion of soldiers preparing to go up against a very powerful adversary on a battlefield,” Hanly said. “You don't want the individual soldiers in the legion to be wandering in different directions and taking a different strategy with respect to the adversary. You want them all to be unified with the same goal in mind, with the same set of rules, so that they are collectively a power—and that's what we think this accomplishes.”

Lawyers reiterated that the class certification would not prevent governments from litigating or settling their cases on their own. The proposal also excludes hundreds of lawsuits in the MDL, including those by unions and Native American tribes.

The motion is more unusual than most filed for certification of class actions, because it comes prior to any settlement yet would not be used to pursue litigation beyond the limited confines that Polster has allowed. In most cases, class actions get certified under those two circumstances, but lawyers insisted in court papers that the “negotiation class” proposed in the opioid litigation fits within the confines of the Federal Rule 23 of Civil Procedure, which governs class actions.

In a brief supporting their motion, they included 40 class representatives, including counties in California, Florida, Georgia, New Jersey and New York, and major cities such as Atlanta, Chicago, Denver, Los Angeles and San Francisco.

That list is impressive, Zimmerman said.

“The named plaintiffs alone in this proposed negotiation class are 40 of the largest cities or hard-hit cities by the opioid crisis itself,” he said.

Also, he noted, class action expert Samuel Issacharoff, of New York University School of Law, signed the motion.

The idea of a “negotiation class” also was modeled on a draft 2019 law review article out this month by Duke University School of Law professor Francis McGovern, who is one of three special masters in the case, and William Rubenstein, a professor at Harvard Law School and expert on class actions who McGovern hired as a consultant in the settlement discussions.

But Zimmerman questioned whether there would be enough commonality for Polster to certify a “negotiation class” under Rule 23. Not only do cities and counties have differing damages from the opioid crisis, they've brought various liability claims against a host of defendants.

“It's highly ingenuitive especially for a sprawling case,” he said. “The question will be: Will the cities buy it, and will the court buy it?”

Court documents outline a plan in which 5,000 counties and 19,500 “incorporated places,” such as towns and villages, could decide whether to be part of the “negotiation class.” They would have the choice to opt out of the class, but being part of it would give them voting powers. Under the proposal, a settlement could go forward if 75% of the class member governments voted for the deal. But the supermajority includes at least six different “pools” of class members, broken out by population or whether the governments had filed lawsuits or not.

Lawyers also provided a calculator at www.opioidnegotiationclass.com to determine how much each government could get under a potential settlement. That formula is based on each government's volume of opioid pills, overdose deaths and “opioid use disorder cases,” described as individuals who are dependent or addicted to opioids.

Under the proposal, Hanly said, cities and counties would have a better chance of negotiating with states over their split of a potential settlement fund—a sticking point that prompted many smaller governments to pursue opioid crisis-related lawsuits separate from their states. If such a split is needed, the proposal named three representatives to be part of a negotiation team: former San Francisco City Attorney Louise Renne, City of New York Corporation Counsel Zachary Carter, and the City of Chicago's corporation counsel Mark Flessner.

“This entire process has to take into account, and it's one of the big question marks behind this entire proposal, the elephant in the room, which are the state attorneys general,” Zimmerman said. “Because the state attorneys general could negotiate a settlement and, in negotiating that settlement, depending on the state law and home rules of that state, could agree to a settlement that leaves out the counties.”

The proposal also sets aside 10% of any nationwide settlement fund for individual attorneys seeking compensation, while class counsel could apply for fees and costs through a potential common benefit fund.

And although no settlement dollars are available yet, Hanly described why many governments might want to participate.

“It is true that at the time within which an entity has to opt out there will not be a dollar amount, but what they're being asked to either stay in or opt out of is simply a structure that would operate if and when there are dollars to be distributed,” he said. “A small county in Kansas is not going to be taken seriously in negotiations with one of these huge companies, but that same small county in Kansas, if it remains a member of this class, will have all the benefits that the whole MDL process brings to individual plaintiffs in this case.”