St. Clair Co.'s opioid suit appears to pick up where Chicago litigation has stalled

By Record News | Apr 21, 2017

St. Clair County’s suit alleging that pill makers addicted Illinois citizens to opioids for profit provides an answer to a Chicago judge who asked lawyers where the claim would go if it failed in his court.

St. Clair County’s suit alleging that pill makers addicted Illinois citizens to opioids for profit provides an answer to a Chicago judge who asked lawyers where the claim would go if it failed in his court.

“Before you go,” U.S. Magistrate Judge Young Kim said after Purdue Pharma counsel Ryan Stoll of Chicago thanked him at the end of a hearing in 2015.

“I do have one question, and this is something that I don’t think the submissions answer.

“If in fact defendants get everything they want, the motions are granted, does the subject matter go away or will it be litigated somewhere else?”

Stoll said it depended on how District Judge Jorge Alonso would rule.

“There are multiple bases which we raised, many of which are entirely dispositive of the complaint,” Stoll said.

“It is entirely possible that if his honor sees it our way, the case will not be pending in front of judge Alonso and the case should not survive the motion to dismiss phase.”

Kim said, “But will the cases then be litigated in some other forum?”

Chicago staff counsel Michael Dolesh responded that the case was originally filed in state court and was moved to federal court.

“This affects the city’s health plan and the reimbursements that the city was forced to pay for drugs which we believe were falsely marketed and were not necessary,” Dolesh said.

“That’s a very real concern to us and obviously if the motions to dismiss are granted, we will just have to look what our options are at that point.”

St. Clair County’s complaint, which state’s attorney Brendan Kelly filed on April 20, lifted its opening sentences and long sections from Chicago’s complaint.

Chicago’s complaint remains active against Purdue Pharma and other pill makers, but Alonso has dismissed most of the claims twice.

Motions to dismiss the current complaint remain pending.

Parallel suits have fared no better.

A California judge stayed an addiction action in 2015, while awaiting research from the Food and Drug Administration.

Last year, a New Hampshire judge ruled that the state’s attorney general could not retain private counsel to pursue addiction claims on a contingency basis.

The retention agreement provided a 27 percent contingency fee for the New York City firm of Cohen Milstein.

New Hampshire’s Supreme Court heard argument over the fee on March 1.

Cohen Milstein represents Chicago and the California plaintiffs, Orange County and Santa Ana County.

Although Cohen Milstein’s words appeared in the St. Clair County complaint, the firm’s name didn’t appear.

David Cates of Swansea, son of appellate judge Judy Cates, signed the complaint. So did Christopher Cueto of Belleville and his associate Michael Gras.

Attorneys Eric Holland and Seth Crompton, of the Holland firm in St. Louis also signed the complaint.

Cohen Milstein’s leadership in addiction litigation ended in February, when seven of its lawyers jumped to the South Carolina firm of Motley Rice.

Linda Singer, Cohen Millstein’s top drug lawyer for eight years, led the relocation.

In 2007, as attorney general for the District of Columbia, Singer signed a settlement of claims that Purdue Pharma falsely advertised and promoted OxyContin.

In 2013, Chicago corporation counsel Stephen Patton retained Singer through Cohen Milstein.

Patton agreed to pay 22 percent of net recovery for resolution before complaint, 26 percent for resolution before summary judgment, and 30 percent after that.

The contract provided that the city would maintain control of the investigation and make all key decisions.

Singer immediately issued subpoenas on behalf of the city against Purdue Pharma, Teva, Cephalon, Johnson & Johnson, Janssen, Endo and Actavis.

Purdue Pharma challenged the subpoenas, due to Singer’s former role as its prosecutor, and she withdrew them.

Chicago sued all the companies in 2014, in Cook County circuit court.

Defendants removed the action to U. S. district court, where Purdue Pharma moved to disqualify Singer.

Alonso denied disqualification in 2015, finding Singer had not taken an active role in the case in Washington.

Defendants separately challenged Cohen Milstein’s involvement, by way of a motion for relief from improper delegation of government police power.

Carolyn Kubota of Los Angeles, counsel to Janssen and Johnson & Johnson, wrote that the complaint referred to numerous documents that Cohen Milstein collected from defendants by means of the subpoenas.

She wrote that Cohen Milstein used documents it obtained from a third party, American Pain Foundation, to make allegations.

“Based on the timing and similarity of the California complaint, defendants have serious concerns not only that the city improperly delegated its investigatory powers to Cohen Milstein, but that Cohen Milstein has improperly used the fruits of that unlawful delegation to advance contingency claims it is pursuing or intends to pursue on behalf of other clients,” Kubota wrote.

She reserved a right to pursue remedies for such misconduct if that should prove to be the case.

Alonso ruled that Cohen Millstein could continue representing the city.

“A number of courts have held that government entities may hire outside counsel on a contingent fee basis if there are certain safeguards in place,” Alonso wrote.

“Because the city retains control over the investigation and litigation of this case, its retention of Cohen does not violate defendants’ due process rights.”

Defendants meanwhile moved to dismiss the complaint and stay discovery.

Alonso granted a stay, and before long he dismissed most of the complaint.

Chicago amended the complaint and moved to lift the stay of discovery.

At a hearing on the motion in September 2015, Kim said, “Let me get some clarification on this. There were counts against Purdue dismissed?”

Purdue Pharma counsel Patrick Fitzgerald of Chicago, former U. S. attorney, said, “Yes, most of them.”

Kim said, “Those dismissed counts are now repled?”

Kenneth Wexler of Chicago, private counsel to Chicago, said, “Correct.”

Kim said, “To preserve for appeal?”

Wexler said no, and “in light of judge Alonso’s ruling, we pled additional facts to satisfy him.”

Kim said, “If the city is trying to revive a claim or claims dismissed by judge Alonso, necessarily the scope of the second amended complaint is in fact broader.”

Wexler said, “Not from a factual standpoint because when you get to each count, they reincorporate the factual allegations stated in the complaint.”

Kim entered an order that, “The discovery stay remains.”

He found the contours of the pending allegations immensely broader than the contours of the allegations that survived the first motion to dismiss.

He wrote that the complication and additional burden on the court, Purdue, and other companies would outweigh any benefit from collecting necessary discovery.

Last September, he again dismissed the bulk of the complaint and gave Chicago 30 days to amend it.

Chicago amended it, and defendants moved to dismiss it.

The motions remain pending.

On April 19, Kim set a status hearing on May 8.

On April 20, St. Clair County sued Purdue Pharma in its own court, on its own behalf and on behalf of the state of Illinois.

The county also sued Abbott Laboratories as a partner in marketing.

The county seeks restitution, damages, disgorgement of profits, civil penalties, punitive damages, fees, injunctive relief and other relief.

The complaint alleges that a deceptive and unfair campaign deprived doctors and patients of the ability to make informed decisions.

It alleges that defendants caused decisions to be made not on science but on hype.

It further alleges that in 2014, more than nine million oxycodone and hydrocodone pills were sold in St. Clair County.

It calculates the ratio at 34 pills per resident, compared with 1.22 pills statewide and 1.73 pills nationwide.

The complaint identifies 10 Southern Illinois doctors who prescribed opiates in violation of the law.

It states that many of them received information that caused them to believe the prescriptions were not as dangerous as they might have been.   

Purdue Pharma issued a statement in response to the complaint:

"We share public officials’ concerns about the opioid crisis and we are committed to working collaboratively to find solutions. The delegation of law enforcement authority to a private law firm with a financial interest in the outcome creates serious public policy concerns and presents a clear conflict of interest. Therefore, we believe that the motion brought jointly by the defendants should be granted.”

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Purdue Pharma L.P Twentieth Judicial Circuit of Illinois

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