The Republican-led chamber passed a bill that restricts communities’ ability to file lawsuits alleging that the sale or distribution of a product created a public nuisance. It mirrors a recent Ohio Supreme Court ruling that saves the opioid industry $651 million.
The Ohio House last week passed legislation that would make it much harder for local governments to sue corporations when their products – be they guns, easily stealable cars, or new and addictive tobacco devices – cause a public nuisance.
The legislation both echoes and expands the thinking behind a recent Ohio Supreme Court ruling that spared major pharmacy chains CVS, Walgreens and Walmart from a $650.9 million judgment won against them for their role in sparking an opioid crisis that kills thousands of Ohioans every year.
A federal judge in 2021 awarded the judgment to Lake and Trumbull counties after a bellwether trial to test the legal theory that the pharmacies created a “public nuisance” through the reckless distribution of tens of millions of powerfully addictive painkillers sold each year. Lake County, for instance, estimates that between 2012 and 2016, 61 million painkillers were dispensed in its borders – 265 for every man, woman and child in town.
Those pills seeded deadly opioid addictions. In 2022, 4,452 Ohioans fatally overdosed on drugs, with fentanyl (a synthetic opioid) by far the most prevalent driver. In 2021, that figure was 4,915. And of those who began abusing opioids in the 2000s, an estimated 75% of them reported their first opioid was a prescription drug, according to the International Journal of Drug Policy. At the heart of the lawsuits is an allegation that drug companies understood the addictive and dangerous nature of the painkillers and flooded communities with them regardless.
The judgment – a huge number, and also an encouraging sign for other governments that opted against a settlement offer from the companies – was short-lived. The pharmacies appealed, and federal judges asked the Ohio Supreme Court to interpret a question of state law. There, the Ohio Supreme Court ruled late last year that the Ohio governments were wrong to bring a public nuisance lawsuit in the first place, because their allegations amounted to violations of product liability laws, not public nuisances. The ruling effectively erased the nine-figure judgement.
How the House bill make it harder to sue companies
State lawmakers last week passed legislation to not only fold the Ohio Supreme Court’s ruling into state law but also expand it. It says, in general terms, that plaintiffs can’t bring lawsuits alleging the sale or distribution of a product created a public nuisance.
Cities say the legislation undercuts their ability to hold manufacturers accountable when their products disturb the general welfare. For instance, some have sued the makers of Kia and Hyundai, whose poor design allowed a theft surge from juveniles that puts a heavy burden on local police. Others have sued gun manufacturers, alleging they sold so many guns that they created a public nuisance of gun violence.
“This is total corporate protectionism,” said Dustin Herman, an attorney whose Ohio law firm, Spangenberg Shibley & Liber, has forced $55 billion in settlements from the manufacturers, distributors, and pharmacists that profited from the opioid epidemic. “That’s all this is.”
What the backers say
The bill passed the House with 59 Republican votes. Three Republicans joined all the House Democrats voting against it. It must still win approval of the state Senate and the governor to become law.
Supporters framed the policy around legal certainty and the separation of powers and generally avoided discussion of the opioid crisis.
Rep. Adam Mathews, a Warren County Republican who also works as a patent attorney, said the legislation aims to prevent “creative lawyering” where governments target products that are made, sold and advertised “properly.” He offered as an example the state of California’s unsuccessful attempt in 2006 to bring public nuisance claims against car companies for their vehicles’ greenhouse gas emissions.
He called the opioid epidemic “terrible” and said the new law would incentivize counties to take a settlement rather than going to trial under an “unclear legal framework” and potentially walking away empty-handed.
The bill’s co-sponsor, Rep. Meredith Craig, formerly a health care lobbyist for the Ohio Chamber of Commerce, said the bill would address an alarming trend across the country “where local governments are encouraged to use public nuisance law to go after industries they politically disfavor, from gun manufacturers, to energy companies, to automakers.”
The business lobby threw its weight behind the idea. The Ohio Chamber of Commerce, the Ohio Alliance for Civil Justice, and the Ohio Council of Retail Merchants all supported the legislation.
“This will help stop businesses from being targets of litigation for societal issues and limit the risk of companies having to defend themselves from a lawsuit that does not require the other side to prove their actions caused an injury,” said Kevin Shimp, an attorney and lobbyist representing the Chamber of Commerce.
Trial lawyers and cities oppose the bill
Most of the criticism against the bill comes from two sources: trial lawyers and Ohio’s local governments.
Plaintiffs’ attorneys said the legislation will give large, corporate actors a big legal advantage over people or governments they’ve harmed.
Public nuisance laws have long been used to force companies to clean up the messes they’ve caused, Herman said in an interview. For instance, the State of California won $305 million against companies that made and sold lead paint, exposure to which can severely impact children’s development, and the City of San Diego won $550 million against Monsanto, a major agricultural company, for creating a public nuisance via use of toxic PCBs.
Most lawsuits stem from specific individuals’ injuries and damages paid to address those injuries. But nuisance actions, Herman said, allow for the special remedy of “abatement” of that nuisance, and judges have broad discretion to figure out how to go about it given a set of facts.
They make sense for opioids, products that weren’t defective in themselves but were sold and prescribed so recklessly that anyone who understood the nature of the drugs could have foreseen a looming public health disaster.
“Public nuisance lawsuits are about cleaning up the mess,” he said.
Cleveland’s city law director, Mark Griffin, told lawmakers if HB126 had been in effect decades ago, the city would have been “powerless” against the tobacco industry, the pharmaceutical industry, or industrial scale polluters. Plus, it couldn’t prevail in lawsuits over Kia and Hyundai for the cities’ costs covering up the extraordinary expenses incurred stemming from the manufacturers’ failure to design cars with industry-standard anti-theft technology.
Cincinnati, via its police chief, offered similar comments, specifically noting a 2,669% increase in monthly car theft reports after a viral social media trend gave the world a how-to guide to steal Kias.
“It challenges the ability of our communities to defend themselves and their residents,” said Kent Scarrett, executive director of the Ohio Municipal League, in an interview. “It weakens the authority behind enforcement efforts.”
All Democrats, some Republicans oppose the bill
All Democrats voted against the legislation. House Minority Leader Allison Russo said in an interview it will harm Ohio’s ability to go after “bad corporate actors.” Rep. Dani Isaacsohn, a Cincinnati-area Democrat, questioned why Republicans are aligned with the pharmaceutical industry over the Ohio counties victimized by its practices.
“When there are massive derailments, when there is an opioid epidemic that is poisoning our people, when big tobacco is poisoning people by the tens of millions, when the next crisis comes that we can’t even predict, whose side do we want the law to be on?” he said.
Rep. Justin Pizzulli, a Republican, represents Scioto County, one of the hardest hit counties in the nation by the opioid epidemic. In an interview, he said he remembers working at a pizza shop kneading dough at 7 a.m., when there would already be a line of hundreds of people waiting for painkillers given out like candy at one of what would later become known as a “pill mill.”
Scioto County opted against taking a settlement from the industry for what Pizzulli described as pennies on the dollar of what the county is owed for unfathomable economic costs. Its lawsuits continue in court. The legislation, he said, helps close a door on the county.
“I think it was a disservice to our local communities. I feel like they’ve been abandoned,” he said. “The opioid crisis completely devastated, wiped out my community. We really felt like when it comes to fire, police, EMS, the economic toll, we’re still rebuilding from that crisis. That money would have done a lot of good.”
Opioid settlement status
In an interview, Peter Weinberger, a lead attorney in the multidistrict litigation against the opioid industry, emphasized that the legislation (and related Ohio Supreme Court ruling) isn’t the end of the line. For one, it only applies in Ohio, and governments around the nation have brought similar claims. Additionally, several Ohio governments are still pressing their legal claims of racketeering, conspiracy, fraud, negligence, misrepresentation and other charges against the industry.
On a national level, the drug manufacturers, distributors and retailers have agreed to pay about $55 billion. Cases remain against some of the pharmacy benefit managers, generic manufacturers, regional distributors and others up and down the supply chain who benefitted financially from the epidemic.
The OneOhio Recovery Foundation, a state-created nonprofit tasked with distributing the money, has already received more than $400 million in settlement money, according to health policy analysts at KFF who have tracked the settlements nationally. Another $1.27 billion is expected in coming years.
Weinberger said he’s not worried about how the Ohio legislation might affect the opioid litigation. It’s the next man-made disaster, he said, that worries him.
“What the Supreme Court did, and what this [legislation] is going to do is prevent these claims from ever being brought,” he said.