AG Rutledge, Prosecuting Attorney Ellington trade filings in argument over who should sue drug makers

by Michael Tilley (mtilley@talkbusiness.net) 480 views 

In separate actions, Arkansas Attorney General Leslie Rutledge and Scott Ellington, prosecuting attorney for the 2nd Judicial District of Arkansas, are taking drug makers to court in a fight against the opioid epidemic. But the AG and prosecutor first may have to resolve their legal filings against each other.

Ellington is a plaintiff in a lawsuit filed March 19 in Crittenden County. The lawsuit was filed by Arkansas-based Rainwater, Holt & Sexton; Reddick Moss of Little Rock; Wyly-Rommel of Texarkana, Texas; and Birmingham-based Cory Watson Attorneys. The firms were hired by the Arkansas Municipal League (AML) and the Arkansas Association of Counties (AAC.)

The lawsuit involves 72 Arkansas counties and 210 cities – the only counties not participating are Drew, Jefferson and Pulaski.

Ellington told Talk Business & Politics the lawsuit needed a “state actor” to prevent defendants from attempting to have the case consolidated with a multi-state, multi-party case now presided over by U.S. District Judge Dan Polster with the Northern District of Ohio. Ellington said he agreed to be the state actor because if moved to the federal court, “the potential recovery (for Arkansas cities and counties) could be reduced significantly.”

Judge Polster has brought in advisors who participated in the national tobacco settlement and settlements with BP following the Gulf of Mexico oil spill. To date, more than 400 lawsuits filed by cities, counties, states and Native American tribes have been consolidated in Polster’s court. Defendants include drug companies, drug distributors and pharmacy chains.

THE TWO ARKANSAS LAWSUITS
The lawsuit filed in the Circuit Court of Crittenden County targets 65 defendants, including manufacturers, three wholesale distributors who control the market, five retail operations and five physician defendants. The complaint seeks a jury trial. Outside counsel will be awarded 21% of the judgment, according to Jerome Tapley with the Cory Watson firm.

Rutledge on March 29 filed a lawsuit in Pulaski County Circuit Court against opioid manufacturers Purdue Pharma, Johnson & Johnson and Endo. The companies make drugs such as OxyContin and hydrocodone. Rutledge along with Gov. Asa Hutchinson made their announcement next to a geographic representation of Arkansas composed of 401 prescription pill containers representing the 401 Arkansans who died of drug overdoses in 2016. Of those, 331 were opioid-related. Since 2000, the state has seen a more than 600% increase in drug overdoses.

According to the Centers for Disease Control and Prevention, more than 200,000 people in the United States died from overdoses related to prescription drugs from 1999 to 2016. According to numbers from the Arkansas Department of Health, 401 Arkansans died of a drug overdose in 2016, and 331 were opioid-related. At the same time, opioid sales in Arkansas have quadrupled from 2000 and 2015, noted the filing in Crittenden County. Arkansas has the second highest opioid prescription rate in the country – 114.6 for every 100 people.

Rutledge also alleges defendants violated the Arkansas Deceptive Trade Practices Act by convincing doctors and patients the addictive drugs were safe for chronic pain.

‘ELLINGTON’S UNLAWFUL ACTIONS’
While both lawsuits make similar claims against the drug companies and affiliated defendants, Rutledge took issue with Ellington being a party to the lawsuit brought by the cities and counties.

Her office on Monday (April 2) filed an emergency “writ of mandamus” asking the Arkansas Supreme Court to order Ellington to “nonsuit the claims” – drop the case – he made in the Circuit Court of Crittenden County. The emergency petition request argues that the Attorney General is the state’s “chief law officer” and the lawsuit with which Ellington is affiliated “will decisively prejudice the State’s ability to pursue its own case against opioid manufacturers.”

“But lacking the resources to successfully prosecute that action, Ellington associated with private, out-of-state attorneys who are not accountable to the Governor, the Attorney General. the General Assembly, or the people of Arkansas,” noted the AG’s filing with the Supreme Court. “Violating principles of good government and public policy, as a result of Ellington’s actions, those same private attorneys also stand to claim significant damages (in excess of the contingency fee caps set forth in Arkansas law) that would otherwise go to the State to address the opioid epidemic.”

Continuing, the AG noted: “While that alone justifies emergency relief, this Court’s intervention is also required because Ellington’s unlawful actions have impaired the State’s sovereign- ty and threaten to hamstring our statewide, constitutional officers’ ability to carry out the will of the people.”

The writ request argues that if Ellington is not forced to drop his action, then his effort “would set a dangerous precedent that is inconsistent with principles of representative government.”

The AG asked the court to force Ellington to respond within three days. (Link here for a PDF copy of the writ of mandamus request.)

PRE-FILING DISCUSSIONS
The writ request also notes discussions were held between the AG’s office and officials with the AML and AAC. The AG’s filing argues the firms behind the Crittenden County lawsuit were willing to have the AG’s office lead the lawsuit – with a caveat.

“But they made clear that while the Attorney General could play the role of a figurehead-leading the Crittenden Litigation-private, out-of-state counsel would control that litigation and determine what was best for the people of Arkansas.”

The AG’s filing also noted during the meetings “there was no suggestion” Ellington would also be a plaintiff. But in his response filed Wednesday afternoon, Ellington disputed claims the AG’s office was surprised of his involvement.

“Petitioner has been aware of Respondent’s joinder with the counties and cities for over two weeks. As such, the timing of the Petition and its designation as ‘emergency’ is puzzling,” Ellington noted in his response to the Supreme Court.

He added that, “… Arkansas Attorney General Leslie Rutledge declined numerous invitations to join the cities and counties in a unified front, instead electing to abandon them and proceed on her own volition …”

(Link here for a PDF copy of Ellington’s response.)

WILLING TO ‘STEP BACK’
Ellington also pushed back against the AG’s claim that use of private attorneys would limit how much Arkansas could collect upon a favorable judgment. He noted the AG is also using private attorneys who will also collect fees.

Indeed, the AG hired Little Rock firm Dover Dixon Horne; Seattle-based Hagens Berman Sobol Shapiro; the Mike Moore Law Firm in Mississippi; and South Carolina-based McGowan, Hood & Felder. The private firms will be paid contingency fees – ranging between 25% for recoveries up to $10 million and an aggregate not exceeding $50 million – based on the judgment.

Ellington also disputed the AG’s claim that a state lawsuit against defendants can’t be handled by a prosecuting attorney that does not represent the entire state. He noted that one of the law firms used by AG Rutledge used a California district court to sue drug makers on behalf of the entire state.

“Petitioner argues that she holds the ‘exclusive’ power to sue on behalf of the State of Arkansas and that its prosecuting attorneys have no such statutory authority. Because she cannot support this with statutory text or case law, Petitioner resorts to her own opinion of ‘good public policy.’ Not only is this the province of the Arkansas Legislature, it is not free of irony. As Petitioner is surely aware, her own private, out-of-state attorneys filed one of the first opioid cases on behalf of the State of California through the Orange County District Attorney,” Ellington noted in his response.

Ellington told Talk Business & Politics he had hoped the AG would at some point join the case, and it was not his plan “to get into a spitting contest with the Attorney General.” Also, he is not willing to end his affiliation with the Crittenden County filing, but is open to the Attorney General intervening in the case. He said if Rutledge would provide assurances her office “would not cut the legs out from under the case,” he would be willing to “step back” and be a co-plaintiff for the state.

The AG’s office sent the following to Talk Business & Politics as a response to Ellington’s filing Wednesday with the Supreme Court: “Last Thursday, Attorney General Leslie Rutledge filed a lawsuit against opioid manufacturers on behalf of the State of Arkansas. The Attorney General is constitutionally and statutorily the only individual who can legally make these claims and file a lawsuit on behalf of the State. Scott Ellington, who serves as the Second Judicial Circuit Prosecuting Attorney, unlawfully filed a suit on behalf of the State. While Attorney General Rutledge worked tirelessly to come to an agreement with Ellington to handle the matter in the best interest of all Arkansans, including those in his prosecutorial district, he was unwilling to do so and as a result, the Attorney General was forced to file a petition with the Arkansas Supreme Court to order Ellington to withdraw the claims that he purported to bring on behalf of the State.”

Despite the “unlawful” allegations made against him by Rutledge’s writ request, Ellington said the issue is procedural, not personal.

“I don’t take it personally. It’s just business. It’s just what we lawyers do.”

Freelance reporter Steve Brawner contributed to this report.

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