Chapter 36
St. Louis, Fall 2017
Paul Hanly was walking down a street in Manhattan in the fall of 2017 when his cell phone rang. It was Joe Rice, a legendary South Carolina trial lawyer at Motley Rice, one of the nation’s largest plaintiffs’ litigation firms. Rice and his partner, Ron Motley, had made a fortune suing the asbestos and tobacco industries. They were among the lawyers who secured the largest civil settlement in U.S. history—$246 billion against cigarette companies in 1998. Motley, who died in 2013, was portrayed in The Insider, a movie about a tobacco company whistleblower—played by Russell Crowe—who took his story to 60 Minutes.
Rice also had turned his sights on the opioid industry. He would become one of the most powerful figures in the nascent litigation.
“Paul, did you know about this?” Rice asked Hanly.
“What?” Hanly replied.
“Paul Farrell just filed for an MDL,” Rice said.
An “MDL” is shorthand for multidistrict litigation, a special federal procedure designed to manage many similar civil cases filed in different U.S. courthouses. The procedure consolidates them in one courthouse under one judge, whose rulings are binding on each of the cases, no matter where they were filed.
“What the hell?” Hanly said, stopping on the street.
A few minutes earlier, the online news service Law360 had reported that Paul and his consortium of law firms just filed a petition with the Judicial Panel on Multidistrict Litigation to pull more than a hundred opioid cases into one massive lawsuit.
“How would I know about this, Joe?” Hanly said. “I don’t know this guy, Farrell. I mean, I only met him once.”
“This is not good,” Rice said. “Bad idea.”
To the two veteran litigators with years of MDL experience, the timing was all wrong. It was way too early to consolidate the opioid cases, they thought. Paul Farrell wasn’t an experienced player in their world. They didn’t think he understood the intricacies of highly complex civil cases involving multiple defendants.
Hanly and Rice wanted to test their cases by filing them individually in different state and federal courts. There, they could begin discovery—the formal process of obtaining documents, emails, and internal corporate reports, and taking depositions of potential witnesses. Their idea was to divide and conquer, forcing the companies to defend multiple lawsuits in a host of jurisdictions, many of them in communities decimated by the epidemic. When plaintiffs file for an MDL, courtroom activity in the different cases across the country virtually ceases while a judicial panel decides whether to consolidate the lawsuits and who will oversee them. Paul didn’t bother to ask for the permission of the other major litigants—in fact he didn’t want it. With the opioid epidemic entrenched well beyond the Ohio River valley and more lawsuits being filed, he feared he would be marginalized by lawyers like Hanly and Rice who would bring cases in New York, Chicago, and other cities. The MDL was a gambit to keep control of the litigation and carve out a central role. Paul had already signed up Mike Papantonio and Russell Budd, two lawyers who had successfully litigated high-profile MDL cases. If the judges created an MDL, the judicial panel would appoint lead attorneys for the litigation, and Paul wanted that role for himself and his allies.
On November 30, 2017, the plaintiffs’ lawyers gathered in a packed courtroom on the twenty-eighth floor of the Thomas F. Eagleton U.S. Courthouse in St. Louis for a 9:30 a.m. hearing before the Judicial Panel on Multidistrict Litigation.
As Conroy approached the courthouse, she saw Paul for the first time. He was surrounded by a film crew, led by Clay Tweel, an award-winning director who was following Paul for a documentary. Who does this guy think he is? Conroy wondered. She had seen her share of lawyers being interviewed outside courthouses, but this Hollywood-style entourage seemed self-indulgent. This hearing was the first step in a very long legal process.
Insanely premature, Conroy thought.
Conroy didn’t know that Paul had a personal connection to Tweel, whose father had worked with Paul in the same law firm in West Virginia. When Tweel heard about the opioid litigation, he asked Paul if he could embed with him and document his every move. Paul agreed. Still, the trailing crew—just like the unilateral decision to seek an MDL—spoke to Paul’s sense of himself as the rising star lawyer in this drama.
The multidistrict litigation panel has considered creating MDLs in more than six hundred thousand cases since its creation by Congress in 1968—everything from airplane crashes, train wrecks, and hotel fires to mass torts involving asbestos, pharmaceutical drugs, data security breaches, and securities fraud.
Every two months, the panel hears cases in a different federal courthouse. If it determines that cases should be centralized in an MDL, it then chooses a judge to oversee the litigation. On November 30, Paul’s request to consolidate all the opioid manufacturing, distributing, and dispensing lawsuits was one of twenty-two scheduled to be heard that day. It was formally called MDL 2804, In Re: National Prescription Opiate Litigation.
The panel of judges, appointed by the chief justice of the Supreme Court, listened to the arguments of seventeen lawyers on whether to consolidate the opioid cases. The first to speak on behalf of Paul’s consortium was Roland K. Tellis of Baron & Budd, which represented the city of Cincinnati. Tellis said there were 155 cases filed in 25 different districts. At the heart of all the claims, he said, was “the duty to report and stop suspicious transactions.”
“Manufacturers and distributors together have that duty,” Tellis said.
“Does the manufacturer have a different way of carrying out that duty than a distributor does, or do they do the same thing?” the chairman of the panel, district court judge Sarah S. Vance, asked.
“I think they do the same thing,” Tellis replied.
District court judge R. David Proctor of the Northern District of Alabama said he was concerned that an MDL could make the litigation unwieldy as more and more cases were included. “We get it, that there’s a common issue as to the duty to make sure that there was not an overprescription of these medications,” Proctor said. But creating an MDL and adding more cases “make[s] this a tangled web that’s very difficult to manage.”
Several of the attorneys argued against creating an MDL. Jeffrey B. Simon, whose Dallas law firm was suing the manufacturers and distributors on behalf of eight Texas counties, said each of his clients opposed bringing the cases together. “We can coordinate with the defendants on our own in Texas,” Simon told the panel.
Hunter J. Shkolnik, who represented about sixty counties and cities across the country, including three cities in Ohio, said he didn’t want to get “tied up in a massive MDL.” He said, “I’m a proponent of MDLs, but we also know that some MDLs take too long to help communities.”
One of the last to speak was Enu A. Mainigi, a partner at Williams & Connolly, a venerable Washington, D.C., law firm. A Harvard Law School graduate, the fiery litigator specialized in defending health care companies, pharmacies, hospitals, nursing homes, and pharmaceutical firms. Mainigi appeared on behalf of the Big Three distributors—AmerisourceBergen, Cardinal Health, and McKesson, Paul’s three largest targets. She joined Paul in his request and supported consolidating the cases into an MDL. Industry lawyers had no desire to fight on more than two hundred different legal fronts; an MDL offered predictability and the possibility of eventually resolving the litigation all at once.
Mainigi said there were many critical questions to be resolved, including the claim that drug distributors are responsible for opioid deaths and whether a city or county could legally bring these kinds of cases.
One of the judges wasn’t following her argument. “But then doesn’t that argue for non-centralization so that these things can be litigated where we leave them where God flung them and let those issues be litigated in separate courts?” Third Circuit Court of Appeals judge Marjorie O. Rendell asked.
“We cannot have 150 different rulings,” Mainigi replied.
Paul had calculated that if he filed an MDL before anyone else, he would become the lead attorney in the litigation, partly because he had held that kind of position before. He filed the first forty transvaginal mesh cases in the country. In 2012, his lawsuits were consolidated with nearly eighty thousand other cases into an MDL in Charleston, West Virginia. Paul was named to the executive committee of the panel and won a multimillion-dollar verdict for his clients. He also believed that an opioid MDL might be transferred to a judge in the Southern District of Ohio. In his petition, Paul had recommended that the panel send it to Edmund A. Sargus Jr., the chief judge of the Southern District of Ohio, appointed by President Bill Clinton in 1996. Paul had already filed twenty cases in that district, and Sargus consolidated them in his courtroom. He felt confident that the other lawyers would chose him to lead the MDL if it went to Sargus, who was presiding over many of Paul’s cases.
Conroy thought Paul had jumped the gun. She knew that these cases are seldom assigned to the judge you want. An MDL could wind up anywhere in the country. It could just as easily be assigned to a judge whom the defendants believed would be more sympathetic to their case.
Paul was willing to take that chance. He also believed that he had reached critical mass, signing up close to forty towns, cities, and counties while Rice, Hanly, and Conroy had enlisted just a handful. Paul had the cases, the others didn’t. Simple as that.
Mark S. Cheffo, an attorney for Purdue Pharma and other opioid manufacturers, asked the panel to send the case to Chicago, where one of the first opioid cases against manufacturers was filed in 2014. But a lawyer suing Purdue argued against creating an MDL, saying it would delay her lawsuit. Linda Singer, who worked with Rice, told the panel she was almost a year into discovery in Chicago and they would have to relitigate issues that had already been “painfully negotiated.” Meanwhile, “defendants continue to engage in the same practices,” she said.
Twelve days after the hearing, on December 12, 2017, the panel issued its decision. For Paul, it was a victory. But only a partial one. He got the MDL he wanted. But crucially, his big bet hadn’t gotten the MDL placed in a courtroom where he believed he’d have the upper hand. Instead of sending the MDL to his favored judge, the panel assigned it to Dan Aaron Polster, a federal judge for the Northern District of Ohio in Cleveland. The MDL judges said they chose northern Ohio because the area had been hard-hit by the epidemic and was centrally located for the lawyers who were spread across the country. They said they sent the case to Polster, a Cleveland native who graduated from both Harvard College and Harvard Law School, because of his previous MDL experience. They specifically cited his time presiding over several hundred cases involving the toxic medical contrast dye containing gadolinium.
While Conroy was not happy with the creation of an MDL, she was “thrilled” that the cases would be heard by Polster. She had been involved in the gadolinium litigation and was impressed by the judge.
But Paul Farrell was deeply disappointed. He and his consortium knew little about Polster or how he might rule on key aspects of the case. Shkolnik’s case, from Cuyahoga County in Ohio, would be the first in line to come before Polster, not Paul’s, from West Virginia.
We’ve lost our venue. We’ve lost our momentum, Paul thought. We’ve lost control of the litigation.