Did ‘poison pill’ in state’s opioid settlement leave money on the table for one Utah county?
May 26, 2022, 10:25 PM | Updated: Jun 19, 2022, 9:58 pm
CLEARFIELD, Utah – Tiffani Fergeson gets teary when she talks about the moment she decided to get sober.
“It changed everything for me,” Fergeson said through tears.
A woman whose checks Fergeson had forged for drug money was testifying against her in a Weber County courtroom three years ago when Fergeson had a thought: If she’d taken a different path, they might have actually been friends.
“I knew I was never using again,” she recalled.
As lawyers in Davis County built their case accusing drugmakers and distributers of downplaying the dangers of opioids and flooding communities with pills, they compiled stories like Fergeson’s: lives permanently changed or lost to addiction, along with the stresses on police, courts, EMTs and hospitals absorbing the crisis.
But preparation for trial ended abruptly earlier this year. Just hours before a January deadline, county leaders decided to withdraw their lawsuit and instead join the state of Utah and most of its other counties in a settlement. But not everyone agreed it was a good idea.
As the county’s top legal adviser, Davis County Attorney Troy Rawlings urged the commission to continue to trial, where he believed the odds were good that a jury would award a much heftier payout. He says one expert estimated damages could be in the ballpark of $1.2 billion dollars for Davis County alone.
The county will see roughly $11.6 million over 18 years, or about $522K each year from the state settlement.
“It’s going to be a pittance,” Rawlings said.
The settlement will bring $266 million to Utah over 18 years, with half going to the state and the remainder heading to counties that joined the effort. Rawlings and others critical of the deal say it’s unfair toward local governments, but others say the payout avoids the pitfall of losing at trial.
A ‘guaranteed route’
The decision weighed on first-term Davis County Commissioner Lorene Kamalu.
She wondered how many more people could receive therapies like medically assisted treatment – which employs medications affecting brain receptors to limit opioid cravings – if a jury awarded damages at a trial.
“I couldn’t imagine not continuing to pursue our own case,” Kamalu said. “I hear about it, and it still gives me just a little lump inside.”
She opposed joining the settlement, but she was outnumbered by her colleagues on the all-Republican panel. Commissioners Randy Elliott and Bob Stevenson did not return messages seeking comment.
The state of Utah also sued the companies, but its decision to settle was much easier, according to top state lawmakers who told KSL Investigators that a trial would have amounted to a big gamble.
“I’ll take the guaranteed route every time,” said House Majority Leader Mike Schultz.
While New York won a recent case against drugmaker Teva, courts in other states have found the drug companies aren’t liable for the crisis. In one example, Oklahoma’s Supreme Court threw out a $465 million ruling against Johnson & Johnson last year. Four counties in California lost a similar case in November.
Like the lawsuits brought by Davis and many Utah counties, those cases argued the companies created a public nuisance.
Schultz said Utah’s counties were free to chart their own course, and he believed Davis would do just that up until the last minute. But Schultz, assigned by House Speaker Brad Wilson to coordinate with counties, also recalls issuing a word of caution to Davis County leaders.
“I think when you have almost every other county in the state want to join on, and one county doesn’t, that shines a light on that county,” said Schultz, R-Hooper. “In my view, it shines a light negatively on that county. That’s my honest opinion, and that’s what I shared.”
A ‘poison pill’
Pressure had been mounting to end the costly, four-year-old case with three major pharmaceutical distributors: Cardinal, McKesson, AmerisourceBergen; as well as drugmaker Johnson & Johnson.
For Utah to get the maximum payout or something close to it, the state’s more populous counties had to take the deal. And without buy-in from Davis County, the 3rd biggest in the state – home to about 11% of Utah’s population – the combined payout would shrink by an estimated $40 million.
“The poison pill built into this is, ‘Davis County, you need to settle and go along and cooperate, because you have enough of a population base,’” Rawlings said. “’If you don’t, everybody else in Utah is going to pay a price.’” Two small southeastern Utah counties, Grand and San Juan, decided not to join the settlement. Grand County Attorney Christina Sloan said the deal is “wholly inadequate” to address the lives lost and ruined, along with the impact to those in the throes of addiction.
While recent state figures placed Grand County’s award at about $405,000 if they joined the settlement, Sloan said the number at one point dipped to less than half that amount, or roughly $7,000 per year over 18 years – what she called an “offensive gesture.”
“So, we risk nothing by proceeding to trial,” Sloan said. Her county of less than 10,000 is too tiny to have a significant effect on the cash flowing to Utah like Davis County did.
Sloan and Rawlings feel their counties were left out of state-level discussions. Both said they are dismayed the state didn’t review their evidence.
Rawlings is adamant that a jury picked in Davis County should have had a chance to decide the case. The deal doesn’t require the companies to admit wrongdoing he noted, or pay damages for the harm done.
“We feel like the defendants are laughing at the state of Utah as they walk out the door,” he said.
A new start
Accountability is top of mind for Fergeson, 37, who said her path to addiction started with an injury and went on to include weekly stops behind a Layton post office, where a doctor would hand her scripts for Oxycontin and Percocet. She and the doctor have both served prison time, she noted, and she lost custody of her kids.
When it comes to the companies, she said, “I think a lot of people would just like to hear, ‘I’m sorry.’”
Her fiancé, Rhett Barger, said the companies should have to pony up much more.
“There’s a lot more than a handful of drug dealers that actually want to help around here,” said Bargar, who is recovering from heroin addiction he said began when he was a teenager reeling from the death of his father.
The pair were childhood friends who dated as teenagers and went separate ways before reconnecting in recovery. They both started therapy at the nonprofit Davis Behavioral Health, and they’re encouraging others they know to get help.
“It’s your turn when you’re clean to help them,” Bargar said.
Bargar and Fergeson won’t get any money directly from the settlement, but the couple says they hope the same programs that helped them will get a boost.
They noted the crisis has not slowed during the pandemic. Opioid overdoses climbed in Utah from 2020 to 2021 and reached a record high nationally, according to the Centers for Disease Control and Prevention.
The cash can be used for a variety of initiatives, but a memorandum of understanding tied to the settlement says treatment and prevention programs get first priority. The money cannot be funneled into the state’s general fund or be used by counties to backfill budgets.
No payment ‘will ever compensate’
The goal of the Utah Attorney General’s Office in negotiating with the companies and other states was to hold distributors and manufacturers accountable, even though no amount of money can compensate for the harms, said Richard Piatt, the spokesman for the Attorney General’s office. He said some estimates of the harms have reached trillions of dollars.
“The reality is that no amount of money will ever truly compensate the families touched by this, and we understand the frustration many feel about the cash settlement,” Piatt said.
Senate Majority Leader Evan Vickers said the agreement allows the money to flow toward treatment and prevention efforts sooner rather than later, and he said counties stand to benefit more than people may realize. Much of the cash coming into the state will be channeled into local programs, he said.
Vickers, who owns three pharmacies in Utah with his family, said manufacturers made billions of dollars from medications that they knew weren’t safe.
“It should have been a little more painful for them,” he said of the settlement.
The companies didn’t return emails seeking comment.
Have you experienced something you think just isn’t right? The KSL Investigators want to help. Submit your tip at firstname.lastname@example.org or 385-707-6153 so we can get working for you.