Tennessee Counties Sue Opioid Makers Using Local “Crack Tax” Law

Zero Hedge – by Tyler Durden

The US opioid epidemic has continued to worsen in 2017 as super-powerful synthetic opioids like fentanyl and carfentanil taint the nation’s heroin supply. While the FBI’s final tally has yet to arrive, preliminary data suggest that overdose deaths last year eclipsed the 50,000 recorded nationally in 2015 – the most ever. And the body count is expected to be even higher in 2017. As the death toll in some of the hardest-hit areas of the country skyrockets – in some cases forcing county coroners to build larger freezers to store the bodies – states have begun filing lawsuits against the pharmaceutical companies responsible for making and marketing opioid painkillers, in hopes of offsetting the ballooning public-health costs that have been a byproduct of the crisis.  

Three Tennessee district attorneys are the latest prosecutors to file suit against the drug makers, joining a group that includes the attorneys general of Ohio, Illinois, Mississippi, New York and Santa Clara and Orange County in California – not to mention the Cherokee Nation. But the Tennessee prosecutors’ approach differs from their peers in one unique way:

They are suing under the state’s long-ridiculed and rarely used “crack tax” law, which would hold Big Pharma liable for damages as if they were street-level drug dealers, the Knoxville News Sentinel reported.

While the companies targeted by individual states differ, prosecutors are all alleging similar misconduct: That the pharmaceutical companies leaned on researchers to play down the drugs’ addictive qualities, while spending millions on marketing them to both patients and doctors.

Another lawsuit filed in Washington in January alleged that Purdue Pharma, maker of OxyContin, was aware of the drug’s immense popularity on the streets, but did nothing to curb its distribution.

The suit also names a “Baby Doe” as a plaintiff. “Baby Doe,” the News Sentinel reports, is a boy born in March 2015 addicted to opiates because his mother, identified as “Mary Doe,” was an opiate addict and bought her drugs in Sullivan County, one of the three judicial districts represented in the legal action.

Filed on behalf of the three prosecutors and Baby Doe by Nashville law firm Branstetter, Stranch and Jennings, the lawsuit spends dozens of pages detailing publicly available accounts of alleged fraud and deceptive marketing practices by opiate manufacturers.

It is now beyond reasonable question that the manufacturer defendants’ fraud caused Mary Doe and thousands of others in Tennessee to become addicted to opioids — an addiction that, thanks to their fraudulent conduct, was all but certain to occur,” the lawsuit stated.

Tennessee logs more opiate prescriptions per capita than every state in the nation except West Virginia, the News Sentinel reported. Sullivan County is considered an epicenter, so much so its law enforcement agencies snared their own reality television shows. Shelby County in West Tennessee is also considering joining the lawsuit.

Tennessee Attorney General Herbert Slatery III issued a statement Tuesday in which he said his office is investigating the state’s options in pursuing its own legal action.

“Our objective is to identify and hold accountable the parties responsible for this opioid epidemic,” the statement read.

That crack tax” – otherwise known as the drug dealer liability statute – was passed in 2005 to allow for civil action against street drug dealers, many of whom were peddling crack.

However, since police typically seize convicted drug dealers’ profits under criminal and civil forfeiture laws – and since most drug dealers go to prison after they’re arrested – there was rarely anything left to be claimed in civil court.

But unlike street dealers, pharma firms are flush with cash. Purdue has annual sales of nearly $3 billion, while Mallinckrodt and Endo also rack up billions each year from sales of opiate drugs.

Many legal experts have said that the current batch of lawsuits resembles the 1998 settlement between the four largest US tobacco companies – Philip Morris, RJ Reynolds, Brown & Williamson and Lorillard – and 46 states attorneys general. In accordance with that judgment, the tobacco companies agreed to pay out more than $200 billion through 2025, with payments to be made in perpetuity.

While states are no doubt in need of financial resources to offset the public-health costs they’re forced to absorb because of the epidemic, pharmaceutical companies have at least one strategy to legally deflect blame: If the showdown ever makes it to trial, defense attorneys will try to slough off as much blame as possible on the overprescribing doctors, like one elderly physician who was arrested earlier this month in New York City and charged with needlessly prescribing millions of pills.


2 thoughts on “Tennessee Counties Sue Opioid Makers Using Local “Crack Tax” Law

  1. The drug corporations lobbyists will insure that the politicians pockets are full of cash, gifts and vacations to continue their business as usual.

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