26 August 2019, District Court of Cleveland County, State of Oklahoma: State of Oklahoma v. Johnson & Johnson et al (Judgment After Non-Jury Trial) (PDF)
Johnson & Johnson ordered to pay $572 million for its role in Oklahoma's opioid crisis
By Lenny Bernstein
August 26, 2019
NORMAN, Okla. -- A judge Monday found Johnson & Johnson responsible for fueling Oklahoma's opioid crisis, ordering the health-care company to pay $572 million to remedy the devastation wrought by the epidemic on the state and its residents.
Cleveland County District Judge Thad Balkman's landmark decision is the first to hold a drugmaker culpable for the fallout of years of liberal opioid dispensing that began in the late 1990s, sparking a nationwide epidemic of overdose deaths and addiction. More than 400,000 people have died of overdoses from painkillers, heroin and illegal fentanyl [1] since 1999.
"The opioid crisis has ravaged the state of Oklahoma and must be abated immediately," Balkman said, reading part of his decision aloud from the bench Monday afternoon.
"As a matter of law, I find that defendants' actions caused harm, and those harms are the kinds recognized by [state law] because those actions annoyed, injured or endangered the comfort, repose, health or safety of Oklahomans," he wrote in the decision.
With more than 40 states lined up to pursue similar claims against the pharmaceutical industry, the ruling in the first state case to go to trial could influence both sides' strategies in the months and years to come. Plaintiffs' attorneys around the country cheered the decision, saying they hoped it would be a model for an enormous federal lawsuit brought by nearly 2,000 cities, counties, Native American tribes and others scheduled to begin in Cleveland, Ohio, in October.
Balkman did not give the state everything it sought -- state attorneys had asked for $17.5 billion over 30 years for treatment, emergency care, law enforcement, social services and other addiction-related needs. But the judge concluded it would cost $572 million to address the crisis in the first year based on the state's plan. He said the state did not provide "sufficient evidence" of the time and money needed to respond after that.
At a news conference following the decision, Oklahoma Attorney General Mike Hunter described it as a "great triumph" two years in the making.
But just moments after the judge ruled, Johnson & Johnson, which has denied wrongdoing, said it would appeal. Company attorney Sabrina Strong said at a news conference, "We are disappointed and disagree with the judge's decision. We believe it is flawed.
"We have sympathy for those who suffer from opioid use disorder," Strong added. "But Johnson & Johnson did not cause the opioid abuse crisis here in Oklahoma or anywhere in this country."
Elizabeth Chamblee Burch, a professor at the University of Georgia School of Law who followed the case, said in an email that other states will almost certainly adopt some of Oklahoma's strategy -- for instance, arguing for Johnson & Johnson's culpability because it had two subsidiaries that produced, refined and supplied the ingredients for opioids to many other companies.
But with state laws differing, it is unclear whether other plaintiffs would be successful at proving the company harmed their residents, she said.
Alexandra Lahav, a professor at the University of Connecticut School of Law, said it's too early to predict the impact of Balkman's decision on future cases.
"I think it's important that people remember that this is just Oklahoma law, and it's a lower court judge," she said. "It hasn't been vetted on appeal yet."
Still, she said, the ruling may provide momentum to the idea that there is merit to these claims and encourage other states to pursue similar strategies.
As an outside observer, Lahav said, she is not convinced that Johnson & Johnson's role as supplier of raw materials to other drug companies sufficiently connects it to the opioid crisis. But Balkman clearly accepted that, she said.
"I'm unconvinced that should be laid at Johnson & Johnson's door," she said.
Hunter (R) brought suit in 2017 against Johnson & Johnson and two other major drug companies, [2] accusing them of creating "a public nuisance" by showering the state with opioids while downplaying the drugs' addictive potential and persuading physicians to prescribe them even for minor aches and pains. Before the late 1990s, physicians reserved the powerful drugs primarily for cancer and post-surgical pain, as well as end-of-life care.
More than 6,000 Oklahomans have died of painkiller overdoses since 2000, the state charged in court papers, as the number of opioid prescriptions dispensed by pharmacies reached 479 every hour in 2017.
Johnson & Johnson's products -- a prescription opioid pill and a fentanyl skin patch sold by its subsidiary, Janssen Pharmaceuticals -- were a small part of the painkillers consumed in Oklahoma. But Hunter painted the company as an industry "kingpin" because two other companies it owned had grown, processed and supplied 60 percent of the ingredients in painkillers sold by most drug companies.
"At the root of this crisis was Johnson & Johnson, a company that literally created the poppy that became the source of the opioid crisis," the state charged.
The state also said the health-care giant actively took part in the industry's effort to change doctors' reluctance to prescribe opioids by mounting an aggressive misinformation campaign that targeted the least knowledgeable physicians.
The company's "marketing scheme was driven by a desire to make billions for their pain franchise," Hunter wrote. "To do this, they developed and carried out a plan to directly influence and convince doctors to prescribe more and more opioids, despite the fact that defendants knew increasing the supply of opioids would lead to abuse, addiction, misuse, death and crime."
Oklahoma settled in March with Purdue Pharma, [3] manufacturer of OxyContin, accepting $270 million from the company and its owners, the Sackler family, who were not named as defendants in the lawsuit. Most of that will go to a treatment and research center at Oklahoma State University, although the federal government is seeking a portion of the money. [4] In May, two days before the trial began, the state settled with Teva Pharmaceuticals, [5] an Israeli-based manufacturer of generic drugs, for $85 million.
The core of Johnson & Johnson's defense during the seven-week trial was that it could not be held liable for supplying legal products and ingredients, which were highly regulated by the Food and Drug Administration, the Drug Enforcement Administration and state authorities themselves.
Company lawyers sought to rebut accusations of a misinformation campaign by attributing actions to third parties and contending that sales calls to doctors did not lead to overprescribing or the drug crisis.
"Never once, however, did the state identify a single Oklahoma doctor who was misled by a single statement Janssen made," the lawyers said in documents filed at the trial.
As for its two subsidiaries that supplied the painkillers' ingredients, Johnson & Johnson lawyers said that Noramco and Tasmanian Alkaloids engaged in legal commerce under the watchful eye of the DEA and in compliance with the federal Controlled Substances Act.
Legally, the trial centered on the state's perhaps unprecedented claim the drug company created a public nuisance in the state of Oklahoma. Historically, that law has been used against loud neighbors, brothels and polluters who used their properties in ways that harmed others.
In this case, Oklahoma said the drug company's conduct clearly endangered the health of state residents.
An Oklahoma law professor called that a novel interpretation but said it could pass legal muster. But in May, a North Dakota judge threw out a similar state lawsuit against Purdue.
The drug company's lawyers contend the state's argument rested on "radical theories unmoored from more than a century of Oklahoma case law." They noted that "no Oklahoma court has ever awarded a plaintiff a cash recovery" to stop a public nuisance.
[1] https://www.washingtonpost.com/graphics/2019/national/fentanyl-epidemic-obama-administration/