HomeMy WebLinkAbout2022 10_Distributors OK Settlement AgreementTulsa County Clerk - Michael Willis
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08/10/2022 09:53:02 AM iSSO, OKLAHOMA
Receipt 0 22 -53663
Fee: $ 18.00 2022 -10
A RESOLUTION TO APPROVE PARTICIPATION IN
DISTRIBUTORS OKLAHOMA SETTLEMENT AGREEMENT
WHEREAS, pharmaceutical opioids have harmed the City of Owasso, Oklahoma and its citizens. This harm
was created and exacerbated by the misconduct and illegal activities of opioid manufacturers
and distributors, including McKesson Corporation, Cardinal Health, Inc., and AmerisourceBergen
(collectively "Settling Distributors ").
WHEREAS, The City of Owasso, Oklahoma, filed suit to address and seek recovery for the harms cause to it
and its citizens.
WHEREAS, Settling Distributors have agreed to settle the claims of the State of Oklahoma and certain
Oklahoma subdivisions in the Distributors Oklahoma Settlement Agreement.
THEREFORE, it was duly moved and seconded that the following resolution be adopted.
THEREFORE, BE IT RESOLVED that the City of Owasso, Oklahoma, hereby elects to, and approves its participation
in, the Distributors Oklahoma Settlement Agreement, authorizes its Mayor to execute the
Settlement Participation Form contained in the Distributors Oklahoma Settlement Agreement as
Exhibit G.
THEREFORE, BE IT RESOLVED that the City of Owasso, Oklahoma, further elects to, and approves, its participation
in the Memorandum of Understanding Regarding Certain Opioid Litigation Proceeds with the
State of Oklahoma ( "Sharing Agreement') and Addendum to the Sharing Agreement
Regarding Certain Opioid Litigation Proceeds, and further ratifies its prior actions of legal counsel
in executing documents necessary for the City of Owasso, Oklahoma to participate in the
Distributors Oklahoma Settlement Agreement, the Sharing Agreement, and the Addendum to
the Sharing Agreement.
THEREFORE, BE IT RESOLVED that the City of Owasso, Oklahoma, further authorizes its Mayor and legal counsel to
take all actions required by the Distributors Oklahoma Settlement Agreement, the Sharing
Agreement and Addendum to the Sharing Agreement to effectuate the Distributors Oklahoma
Settlement Agreement for the benefit of City of Owasso, Oklahoma, including executing any
documents required to finalize the participation of City of Owasso in the Distributors Oklahoma
Settlement Agreement, the Sharing Agreement, and the Amendment to the Sharing
Agreement.
ATTEST:
PASSED AND APPROVED this 2nd day of August, 2022.
Mayor
TO: The Honorable Mayor and City Council
FROM: Julie Trout Lombardi
City Attorney
APPROVED BY COUNCIL
AUG 0 2 2022
SUBJECT: Resolution 2022 -10 and Resolution 2022 -11, Approving Participation in Opioid
Litigation Settlement Agreements
DATE: July 28, 2022
BACKGROUND:
The City of Owasso was approached several years ago by the law firms of McAfee & Taft and
Fulmer Sill to discuss multi- district civil litigation against opioid manufacturers. This litigation was
intended to combat the burgeoning opioid epidemic which arose out of decisions and actions
of opioid manufacturers and distributors. The City Council met with attorneys from both firms at
the Worksession on August 14, 2018, and again discussed the matter in executive session on
October 9th and December 4th. On February 19, 2019, the City Council approved participation
in the Opioid Litigation (Amended Resolution No. 2018 -16 attached hereto). The Resolution
provided that any monies received in settlement of this litigation would be used solely for
purposes of prevention, treatment, counseling or education related to the use of opioids and
addiction. Over three (3) years later, two (2) settlements have been proposed. Both settlements
are individually outlined below.
Distributor's Oklahoma Settlement Agreement
This proposed settlement is with the "Big 3" distributors: McKesson Corporation,
AmerisourceBergen and Cardinal Health. The maximum, total amount to be divided amongst
the participating municipalities is $293,740,207.19, payable over an eighteen (18) year period
with the first two (2) years of payments to be made on December 1, 2022, if all deadlines are
met. Attorney fees (25 %) and expenses will be deducted from this amount and attorney fees will
be paid over a seven (7) year period. Owasso's proposed allocation of this award is 1.034%
which equals approximately $978,200.00. These allocations were calculated by the expert
economist retained in this litigation, Dr. Christopher Ruhm, and are based upon objective data
of opioid - related deaths, opioid shipments and the municipal budget for the relevant years. This
settlement requires that eighty -five percent (85 %) of the total payments to subdivisions be used
for opioid remediation /abatement. The attached White Paper outlines permitted remediation
uses.
Janssen Oklahoma Subdivision Ooioid Settlement Agreement
Janssen is a Johnson & Johnson company and the Settlement Agreement specifically includes
Johnson & Johnson. The total amount of the proposed Janssen settlement is $14,020,446.75,
and, like the Distributor's Settlement, requires 100% by participating municipalities. If approved,
the settlement amount will be paid by Janssen in one (1) payment within thirty (30) days after
the participation date. This necessarily means that the settlement amount will be paid in 2022.
Owasso's allocation under this proposed settlement is 1.034% which equates to a gross payment
of $187,600.00. Attorney fees (25 %) and costs will be deducted from that amount. Proceeds
from this settlement agreement must be used to remediate the harm caused by Janssen or to
provide restitution for such harms.
Resolutions 2022 -10, 2022 -11
Page 2
RECOMMENDATION:
Staff recommends approval of Resolution 2022 -10 and Resolution 2022 -11, authorizing
participation in the Distributor's Oklahoma Settlement Agreement and the Janssen Oklahoma
Subdivision Opioid Settlement Agreement, and authorization to execute all necessary
documents.
ATTACHMENTS:
Resolution No. 2022 -10
Resolution No. 2022 -11
Distributors Oklahoma Settlement Agreement
Janssen Oklahoma Subdivision Opioid Settlement Agreement
Exhibit 1 Distributor Settlement Agreement (Global)
Memo of Understanding with State (Sharing Agreement)
Addendum to Sharing Agreement with State
Settlement Participation Form, Exhibit G
White Paper on Abatement Purposes under Distributor Settlement with Exhibit E, Opioid Remediation Uses
Amended Resolution 2018 -16 approving participation in the Opioid Litigation