A recent Law 360 story by Emily Field, “Opioid Cos. Slam Atty Fee Proposal That Could Reach $3.3B,” reports that drug companies told the Ohio federal judge overseeing the multidistrict litigation over the opioid epidemic that a proposal for attorney fees — which they say could be more than $3.3 billion — would "severely jeopardize" settlement negotiations in the litigation.  Opioid manufacturers and distributors — including Johnson & Johnson and McKesson Corp. — said that a proposal that would set a 7% fee against a global settlement for a common benefit fund is a "transparent" attempt by lawyers on the plaintiffs' executive committee to grab settlement funds. 

Approving the proposal would favor the lawyers over the parties in the litigation, even their own clients, the companies said.  "And it would seriously jeopardize the global settlement that this court has said it wants," the companies said in a memo in opposition to the fund proposal.  Seven percent of the $48 billion settlement proposed in October would be more than $3.3 billion, the companies said.

"The [plaintiffs executive committee] seeks to grab a piece of every opioid-related resolution across the country, including settlements with the state attorneys general and of the many other actions brought in state court," the companies said.  "But there is simply no legal or equitable basis for the relief the [plaintiffs executive committee] seeks.  This court has no jurisdiction over settlements outside of the MDL."

Co-lead counsel for the plaintiffs executive committee Paul T. Farrell of Farrell Law, Paul J. Hanly Jr. of Simmons Hanly Conroy and Joe Rice of Motley Rice LLC said in a statement that suing the opioid industry has never been about getting the most money for lawyers, but to make sure that money is directed toward treating the crisis.  "[It's about] reforming the power structure between Corporate America and Main Street in a way where a town in Appalachia has as much of a legal voice as multi-billion-dollar companies; and it's about saying we disagree with taxpayers bearing the brunt of funding a generation-defining crisis that they did not cause," the attorneys said.

They said that calling common benefit fees a roadblock to settlement is a mischaracterization and that they are actively engaged in negotiations with opioid distributors.  On Monday, a group of 37 state attorneys chimed in with their objections to the proposal in the most recent of several dust-ups between states and the MDL plaintiffs' attorneys.

In perhaps the most notable clash, MDL attorneys have rejected an $18 billion proposed settlement that four state attorneys general brokered last year with AmerisourceBergen Drug Corp., McKesson Corp. and Cardinal Health Inc. Recently, 20 states joined the MDL attorneys in expressing opposition. 

The committee's proposed fund would seemingly apply to some parts of settlements reached by states as well as to state court actions that are beyond the federal court's jurisdiction, violating state sovereignty, according to letter sent by the state attorneys general.  The letter also asserted that a proposed order establishing the fund would result in local governments paying more in attorney fees, even though common benefit funds are generally used to reallocate fees among attorneys in an MDL.