The Role of Attorneys General in the Opioid Litigation

By Daniel Aaron

People following the opioid lawsuits might have noticed some strange headlines as of late. Virtually every state’s attorney general (AG) is suing Purdue Pharmaceuticals, maker of the blockbuster drug OxyContin. Purdue filed for bankruptcy and is hoping to settle for “$10 billion.” However, the deal only includes $4.4 billion in cash, which is less than the Sackler family, owners of Purdue, transferred to personal accounts over the past decade. In other words, the amount of money the Sacklers made from the opioid epidemic is more than what they will pay more than forty states to help abate the crisis. Is anyone supporting this deal?

Yes, in fact, and this is where the plot thickens. With several exceptions, support for the deal falls along party lines: Republican AGs support the deal, and Democratic AGs oppose it. Why does a decision about settling with an opioid company appear to be political? What is the role of an attorney general? And are they supposed to defend public health?

Brief History of Attorneys General

Attorneys general have been around since the founding of the country. Although an AG is responsible for enforcing the law, the role has changed over time. Generally speaking, a state AG’s authority has increased over time, although this authority varies from state to state.

Although we think of AGs as taking on big national lawsuits, that wasn’t always the case. Prior to the 1980s, state AGs tended to be docile and reactive. However, after Ronald Reagan was elected in 1981, federal agencies greatly reduced their enforcement activity, and much of this regulatory activity moved to the states. States began to better fund their AGs’ offices, leading to recruitment of more and stronger attorneys. AGs took on a greater role in ensuring good living conditions in their states.

 

Attorney General Suits in Modern America

Two other forces led to the increasing importance of lawsuits by AGs. First, a new way to aggregate lawsuits for many people was needed. The class action lawsuit, which became a tour de force in the 1960s, became weighed down with procedural barriers. The most important barrier is mandatory arbitration, a contract term that Americans often unknowingly sign with various companies, causing them to lose their right to bring a class-action lawsuit against a company. Mandatory arbitration clauses were validated by the Supreme Court in AT&T v. Concepcion (2011). Attorneys general, however, do not sign these contracts and can sue on behalf of the public.

In addition, the 1990s big tobacco litigation offered a proof of concept that big public lawsuits could be effective for vindicating the public interest and obtaining financial redress. In the late 1990s, lawsuits by states AGs led to the famous Master Settlement Agreements with tobacco companies, which recouped more than $200 billion in compensation for the medical expenses of treating people who smoke, as well as imposing various other restrictions on tobacco companies. Since then, the agreements have come under criticism for, in some cases, actually hurting public health. Still, they cemented the use of large public lawsuits by AGs in modern America.

Today, these lawsuits are often referred to as “parens patriae” suits. “Parens patriae” is Latin for “parent of the country.” States have broad parens patriae authority to pursue lawsuits in the name of the general health and well-being of their residents.

 

Attorneys General and the Opioid Litigation

If AGs are suing opioid manufacturers and distributors on behalf of the public interest, why is the possible settlement deal with Purdue so polarized? There is no clear answer. However, commentators have recognized that attorneys general have become more polarized in recent years. They and their attorneys-general associations have taken monetary gifts from opioid companies. And those AGs who have hired private firms have generally favored the settlement (the private firms want their percentage of the pot as soon as possible), while the lead opposers, Massachusetts and New York, represent themselves. All this suggests that some attorneys general are less neutral than one would hope, and may prefer an outcome that does not maximally protect public health.

What might be goals of a settlement with Purdue, beyond the “10 billion dollar” deal? Here are several options:

1. More substantial payout
2. Investigating other monies that the Sackler family has transferred abroad
3. Accountability & deterrence – ensuring future pharmaceutical dealers will know there are consequences, whether by financial impact or criminal liability
4. Transparency – Release of documents, which could help other cases, facilitate follow-up investigations, and contribute to scientific research
5. Regulation – Requiring compliance with new restrictions on marketing, agreement to future liability, or other provisions
6. Restrictions on states – Requirements to spend money on treatment and prevention

Hopefully, as AGs weigh the options for a settlement with Purdue and other opioid companies, they will exert a sincere effort not just to accept money, but to protect public health.