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COMMITTEE OF THE WHOLE Packet - 6/11/2019CITY OF MUSKEGO COMMITTEE OF THE WHOLE AGENDA 06/11/2019 5:30 PM Muskego City Hall, W182 S8200 Racine Avenue CALL TO ORDER PLEDGE OF ALLEGIANCE ROLL CALL STATEMENT OF PUBLIC NOTICE APPROVAL OF AGENDA APPROVAL OF MINUTES April 23, 2019 and May 28, 2019 NEW BUSINESS Presentation by Attorney Fred Tabak Regarding Ongoing Opioid Litigation throughout the Country Review of Water Bugs Ski Team, Inc. and City of Muskego Lease Agreement for the Idle Isle Pavilion COMMUNICATIONS AND MISCELLANEOUS BUSINESS AS AUTHORIZED BY LAW ADJOURNMENT The Committee of the Whole may possibly reconvene immediately following the Common Council meeting of the same date to continue work on agenda items. NOTICE IT IS POSSIBLE THAT MEMBERS OF AND POSSIBLY A QUORUM OF MEMBERS OF OTHER GOVERNMENTAL BODIES OF THE MUNICIPALITY MAY BE IN ATTENDANCE AT THE ABOVE-STATED MEETING TO GATHER INFORMATION; NO ACTION WILL BE TAKEN BY ANY GOVERNMENTAL BODY AT THE ABOVE-STATED MEETING OTHER THAN THE GOVERNMENTAL BODY SPECIFICALLY REFERRED TO ABOVE IN THIS NOTICE. ALSO, UPON REASONABLE NOTICE, EFFORTS WILL BE MADE TO ACCOMMODATE THE NEEDS OF DISABLED INDIVIDUALS THROUGH APPROPRIATE AIDS AND SERVICES. FOR ADDITIONAL INFORMATION OR TO REQUEST THIS SERVICE, CONTACT MUSKEGO CITY HALL, (262) 679-4100. Packet Page 1 Unapproved CITY OF MUSKEGO COMMITTEE OF THE WHOLE MINUTES April 23, 2019 5:30 PM City Hall, W182 S8200 Racine Avenue CALL TO ORDER Mayor Chiaverotti called the meeting to order at 5:39 p.m. ROLL CALL Present: Alderpersons Hammel, Borgman, Engelhardt, Kubacki and Madden. Also present: City Attorney Warchol and Deputy Clerk Blenski. Alderpersons Wolfe and Kapusta were absent. STATEMENT OF PUBLIC NOTICE The Deputy Clerk stated the meeting was noticed in accordance with the open meeting law. NEW BUSINESS Discuss Possible Survey Questions for Building a RFP for the Purpose of a For-Profit Use in Public Parks Mayor Chiaverotti distributed a list of possible survey questions. Several Alderpersons questioned if a survey should be done. Having a public informational meeting was suggested. Alderperson Kubacki stated the people in the surrounding area should be surveyed because they would be the most impacted. A survey could be placed in the seasonal Recreation Activity Guide. Alderperson Hammel asked what would be done with the survey results. The final decision is going to be made by the Common Council. Alderperson Kubacki believes some input is needed to help the Council make a decision. Alderperson Madden expressed concern that a survey would provide too many different options. She also thinks the Little Muskego Lake residents are going to want something different than the other park users. Alderperson Borgman would like to see data collected this year to determine the park usage. The consensus of the Committee was to do the following: No survey. Gather statistics this summer for volume regarding parking, launches, and pavilion use at Idle Isle via pay stations and cameras. Tweak the General Concessions RFP based on statistics gathered. Send to all local restaurants in the City for 2020. A food truck could be an option. ADJOURNMENT Alderperson Madden made a motion to adjourn at 6:15 p.m. Alderperson Kubacki seconded; motion carried. Minutes taken and transcribed by Jill Blenski, Deputy Clerk. Page 1 of 3 April 23, 2019 and May 28, 2019 Packet Page 2 Unapproved CITY OF MUSKEGO COMMITTEE OF THE WHOLE MINUTES May 28, 2019 5:30 PM City Hall, W182 S8200 Racine Avenue CALL TO ORDER Mayor Chiaverotti called the meeting to order at 5:37 p.m. ROLL CALL Present: Alderpersons Wolfe, Borgman, Kapusta, Engelhardt (arrived at 5:40 p.m.), Kubacki and Madden. Also present: Police Chief Rens and Deputy Clerk Blenski. Alderperson Hammel was absent. STATEMENT OF PUBLIC NOTICE The Deputy Clerk stated the meeting was noticed in accordance with the open meeting law. APPROVAL OF MINUTES Alderperson Madden moved to approve the April 9, 2019 minutes. Alderperson Kubacki seconded; motion carried. NEW BUSINESS Discuss 2020 Planning Calendar and Budget Goals The proposed 2020 Budget Planning Calendar was reviewed. Mayor Chiaverotti highlighted the essential budget meetings. The process will conclude with the Public Hearing on Monday, October 21, 2019 and adoption of the budgets on Tuesday, October 22, 2019. The Mayor next turned the focus to the budget goals. She asked if the Committee wanted to continue to review health insurance rates on an annual basis. Director Mueller stated she would have the new rates for the 2020 - 2021 insurance year in May. Alderperson Kubacki noted that depending on what the rates are, he may want to review all the options. Mayor Chiaverotti stated comparable information was still being gathered regarding a proposed merit increase. She asked if there were any recommendations. Alderperson Kubacki requested that comparable salaries for the Mayor’s position also be researched. It was determined that salaries for all elected officials would be reviewed. Alderperson Wolfe noted that the health insurance benefits did not change; that should be taken into consideration when considering a merit increase. As part of the budget goals, the Mayor stated an item will be placed on the next Committee of the Whole Agenda regarding equity between the Lake Districts. The Mayor gave an update on the Police Department Building Project, which is ahead of schedule. Some structural issues with the roof were discovered in the old City Hall Building during the project. Those issues have been addressed. The City has been awarded some grant funding, which will help with the bottom line cost for the project. Future discussion will need to occur regarding what will be done with the existing Police Department Building. Director Mueller was dismissed. SCIT Vehicle Presentation Police Chief Rens stated several members of Suburban Critical Incident Team (SCIT) were present. The purchase of a rescue vehicle is proposed to be shared by all nine of the participating jurisdictions. Sgt. Jason Pfeiffer of Brookfield presented information regarding the vehicle. Page 2 of 3 April 23, 2019 and May 28, 2019 Packet Page 3 2 May 28, 2019 The approximate cost is $300,000.00, which would be shared by all nine communities. Donation efforts are also in place to reduce the overall cost of the vehicle. Elm Grove Village Manager David DeAngelis has agreed to handle the financial aspects of the purchase. An MOU would be required; each community would be looking at a $7,500 annual cost for a five-year period with a low interest rate. That amount could be reduced by donations received. The vehicle would be housed in New Berlin and has a lifespan of 20 plus years. Alderperson Wolfe expressed support. Mayor Chiaverotti stated the dollar amount would be placed in the Capital Budget. The Mayor thanked all those in attendance who provided information regarding the SCIT Vehicle. ADJOURNMENT Alderperson Kubacki made a motion to adjourn at 6:17 p.m. Alderperson Madden seconded; motion carried. Minutes taken and transcribed by Jill Blenski, Deputy Clerk. Page 3 of 3 April 23, 2019 and May 28, 2019 Packet Page 4 NATIONALOPIOID LITIGATION PRESENTED BY REBUILDING COMMUNITIES TOGETHER Page 1 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 5 Our country is in the midst of a public health crisis stemming from a flood of opioids pouring into our cities and counties. These opioids are destroying our families, taking the lives of our loved ones, and sapping tax dollars and resources from our communities. This opioid epidemic has been fueled by the greed of the corporate elite which includes drug manufacturers and distributors. Despite being required by federal and state law to detect and report “suspicious” orders of opioids they chose not to comply. This has to stop. These companies need to be held accountable. We can help. WHY US? IN 2016 THERE WERE OVER 42,249 DEATHS INVOLVING PRESCRIPTION OPIOIDS – THIS IS 5X HIGHER THAN IN 1999 2 | NATIONAL OPIOID LITIGATION www.cdc.gov/drugoverdose/epidemic/index.html Page 2 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 6 We are unlike any other firm or attorney group. As opposed to some firms who are attempting to pursue this litigation on their own, we have formed a consortium comprised of some of the preeminent trial firms in the country that specialize in pharmaceutical litigation. This Consortium was not cobbled together to fight a single battle. Recognizing that the target defendants are some of the richest corporations in the country we are prepared to go the distance and hold them accountable. We are leaders in opioid litigation having filed some of the first cases in the country and having cases already working through the courts. Currently representing more than 200 governmental entities, our Consortium has filed more opioid cases across the country than any other group and is currently representing clients in more than ten states. Throughout this process, our firms have worked together seamlessly and successfully. All six firms in our legal team are nationally recognized litigation firms that have built a reputation on their ability and willingness to litigate to verdict complex disputes against some of the world’s largest companies. Large cases and powerful defendants are nothing new to us. We have fought and won cases against giants such as Big Tobacco, BP, Bayer, Merck, and DuPont to name just a few. Whether large or small, we are committed to representing local governments – cities, towns, and counties – and ensuring that they each are justly compensated for the public health crisis and costs imposed on them by the manufacturers and distributors of opioids. ABOUT OUR LEGAL TEAM NATIONAL OPIOID LITIGATION | 3 Page 3 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 7 In December 2017, the cases brought against opioid manufacturers and distributors were consolidated in front of Judge Dan Polster in the Northern District of Ohio into a multi-district litigation (“MDL”). The MDL process permits the temporary transfer of civil lawsuits to one district court for pretrial consideration and/or consolidation. This creates efficiency and consistency by reducing the risk of contrary legal opinions and by allowing for coordinated discovery. 4 | NATIONAL OPIOID LITIGATION MULTI-DISTRICT LITIGATION (MDL) OUR TEAM HOLDS FIVE KEY LEADERSHIP POSITIONS IN THE MDL Our legal team led the way toward the creation of the MDL, in the best interests of our clients. The benefits to our clients include consistency in the legal rulings and opinions of the presiding judge, an efficient and coordinated discovery process, and lower costs by preventing redundant and repetitive efforts from being made at the county’s expense. FOUR THINGS THAT SEPARATE OUR CONSORTIUM FROM OTHER FIRMS AND GROUPS: 1. Pioneers of the Wholesale Distributor Litigation Our Consortium was the first to pursue litigation against the wholesale distributors on behalf of municipalities and filed the motion seeking formation of an MDL proceeding on behalf of the other public entity clients we represent. Being the first to litigate these cases on behalf of counties and cities also means we have the most experience developing crucial evidence and litigating the common arguments being made by defendants. We have already conducted an in-depth investigation into the facts giving rise to potential liability of the opioid manufactures and distributors and are already engaged in focus groups and mock trials to test trial strategy and defenses. 2. Our MDL Leadership The six national law firms that comprise our legal team are considered giants in the MDL world and between them have been actively involved in most every major mass tort litigation since the days of asbestos. Between our six firms we have 28 lawyers across the country currently working full-time on this project, with an additional 200 attorneys and hundreds of support staff at our disposal. Page 4 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 8 NATIONAL OPIOID LITIGATION | 5 This experience, combined with our extensive client list, our opioid litigation experience, and our stature within the MDL community has led to us receiving five of the twenty-two leadership roles on the Opioid MDL including Co-Lead Counsel (Paul Farrell, Greene Ketchum), Co-Liaison Counsel (Troy Rafferty, Levin Papantonio), and three Plaintiff’s’ Executive Committee positions (Peter Mougey, Levin Papantonio; Roland Tellis, Baron & Budd; Mike Fuller, McHugh Fuller). This is an incredible benefit to our clients, ensuring that their community’s cries for help are heard. 3. Former DEA and Exclusive Preeminent Witnesses 60 Minutes has aired several exposes that have highlighted the nefarious conduct of the pharmaceutical distributors and featured interviews of former DEA agents that have been retained by our Consortium under agreements that they testify exclusively for our group. (The Whistleblower, Redemption, 10/15/17). Additionally, we have retained many of the country’s preeminent experts in the fields of addiction medicine, pain management, epidemiology, public health, urban and rural blight, the economics of addiction, and others (e.g. Presidents of Medical Schools, Universities, and Pharmacy Schools, as well as the heads of several governmental agencies), many of whom have published extensively on the subject of the opioid epidemic. These experts will help determine the amount needed to implement a strategic plan that will compensate your community for past and ongoing damages. 4. Experienced Trial Lawyers The members of our Consortium are all trial law firms with unmatched experience in pharmaceutical litigation. Unlike many firms, we are staffed, experienced, and able to take our clients’ cases to trial, if the need arises. No matter the case, no matter the client, we will do what’s best for each of them, whether that’s taking the case to trial or negotiating a settlement. OUR LEGAL TEAM WAS NOT CREATED SIMPLY TO WIN A SMALL BATTLE, we have created a team, a partnership, that is made to win the war, and it is a war that must be waged on the opioid crisis and those that fuel it and profit from it. We must hold the perpetrators of this crisis accountable and begin to rebuild our communities that have been ravaged by these drugs. Page 5 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 9 The manufacturers and distributors of prescription opioids have created this opioid epidemic by generating a population that is physically and psychologically dependent on opioids (the demand) and conspiring to provide floods of prescription opioids which are not medically necessary and will ultimately become available for illicit use or sale (the supply). These manufacturers and distributors have been repeatedly investigated and sanctioned by regulators for abdicating their legal duties. For example, within the last several years alone, the largest opioid distributors in the nation, as well as certain manufacturers, have been fined hundreds of millions of dollars for their failure to report suspicious orders to the DEA and prevent diversion of these dangerous drugs. Many of these same defendants have been subject to prior litigation by states and counties arising out of the prescription opioid crisis. However, the fines and prior litigation have not stopped the flood of opioids into our communities and have provided little - if any - relief to our communities. For years, the distributors and manufacturers of prescription opioids have failed to report or halt suspicious orders, while funneling millions of pills into our communities. 6 | NATIONAL OPIOID LITIGATION AN INDUSTRY CREATED EPIDEMIC Page 6 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 10 WHO ARE THE MANUFACTURERS? • Purdue Pharma • Endo Health Solutions • Janssen Pharmaceuticals • Mallinckrodt • Cephalon • Actavis • Insys Therapeutics • Teva Pharmaceuticals WHAT DO THEY MANUFACTURE? • Oxycodone • Hydrocodone • Fentanyl WHO ARE THE DISTRIBUTORS? The “Big Three” • McKesson Corporation • Cardinal Health • AmerisourceBergen Drug Corp. OTHER WHOLESALE DISTRIBUTORS • Miami-Luken • Masters Pharmaceuticals PHARMACY DISTRIBUTORS • Wal-Mart • CVS • Walgreens • Rite Aid MANUFACTURERS AND DISTRIBUTORS ARE RESPONSIBLE - THEY KNEW! NATIONAL OPIOID LITIGATION | 7 Page 7 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 11 OPIOID DISTRIBUTION SYSTEM - THE DISTRIBUTORS’ AND MANUFACTURERS’ To understand why these companies are liable for the epidemic that is crippling our country, it is helpful to know how the system of drug distribution is designed to work. RESPONSIBILITY TOPREVENT DIVERSION 1970 CONTROLLED SUBSTANCES ACT (CSA) Congress enacted this law to create a “closed system” for the distribution of controlled substances and designed to prevent diversion of legally produced substances into illicit markets. This act stripped the manufacturers of the ability to sell directly to retailers and created a link in the distribution chain between Big Pharma and pharmacies. With this act, distributors and manufacturers became legally bound to identify, investigate, and report suspicious orders of opioids to authorities. These distributors and manufacturers have access to nonpublic data showing the volume and pattern of opioid sales nationwide and have a legal duty to spot and report red flags in the distribution chain to authorities and to halt suspicious orders before shipment. These pharmaceutical companies are supposed to serve as the gatekeepers – the watch dogs – for preventing opioid abuse. However, for years, the distributors and manufacturers of prescription opioids have failed to report or halt suspicious orders, while continuously funneling millions of pills into communities. Distributors and manufacturers of opioids systematically and fraudulently violated their statutory duties to prevent diversion of their drugs and to notify the DEA of suspicious orders. Through their scheme, the distributors and manufacturers of opioids repeatedly engaged in unlawful sales of painkillers, which, in turn, artificially and illegally increased the annual production quotas for opioids allowed by the DEA. In doing so, the manufacturers and distributors allowed hundreds of millions of pills to enter the illicit market, allowing them to generate obscene profits. 8 | NATIONAL OPIOID LITIGATION Page 8 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 12 THE DISTRIBUTOR Rather than controlling the flow of pills and alerting authorities to suspicious orders, the distributors have chosen to abuse their privileged position, lining their pockets by shipping massive quantities of drugs to pharmacies and dispensaries. They have breached the very industry standards they helped enact and that has led to our present-day epidemic. McKesson, Cardinal, and their distributor cronies admit that they are the gatekeepers for preventing opioid abuse, stating: “distributors are uniquely situated to perform due diligence in order to help support the security of the controlled substances. . . and reduce the possibility that controlled substances within the supply chain will reach locations they are not intended to reach.” The distributors make this admission in the Industry Compliance Guidelines they themselves created to comply with legal mandates – and then wholly ignored. Federal and state laws give cities and counties the means to hold these distributors accountable for their actions and to stop the influx of these powerful drugs. The pharmaceutical distributors are the first line of defense and are supposed to play the role of “beat cops” in preventing the flow of controlled substances to illegitimate uses that can lead to abuse, addiction and blight. Distributors are legally required to be on alert for suspicious orders by pharmacies – such as unusual size, frequency, or pattern – and to report these to the relevant authorities to be investigated. In January 2017, McKesson, the largest drug distributor in the nation, was fined a record $150 million by the federal government for its blatant failure to report suspicious orders in violation of federal law. Cardinal Health, another member of the “Big Three” drug distributors, was fined $44 million for its own failures to report suspicious narcotic orders to the DEA. THERE ARE OVER 800 REGISTERED WHOLESALE DISTRIBUTORS IN THE UNITED STATES. BUT THREE FORTUNE 500 COMPANIES OWN 85% OF THE MARKET SHARE: EACH COMPANY GENERATES OVER $100 BILLION IN REVENUE ANNUALLY. NATIONAL OPIOID LITIGATION | 9 Page 9 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 13 THE MANUFACTURER Manufacturers of controlled substances are under the same legal obligations as distributors to prevent drug diversion and are also required to notify DEA of suspicious orders. But they don’t. In July of 2017, the DEA for the first time sanctioned an opioid manufacturer for failing to report suspicious opioid orders. Pursuant to a memorandum of understanding between manufacturer Mallinckrodt and the DEA, Mallinckrodt paid a $35 million civil penalty for violating federal laws that mandate suspicious order reporting. CHARGEBACK SYSTEM/SCHEME Mallinckrodt was caught operating what is known in the industry as a “chargeback” system. Mallinckrodt sold opioids to a wholesale distributor at a higher than usual price, and then offered the distributor a substantial rebate in exchange for the distributor’s downstream customer sales information or “chargeback data”. This chargeback data allows manufacturers, like Mallinckrodt, to obtain knowledge of suspicious opioid orders. The “chargeback” system is not unique to Mallinckrodt. An investigation performed by our Consortium has discovered that this practice is widespread throughout the industry, and that manufacturers have embraced shipping suspicious orders of opioids as an integral part of their business model. Therefore, manufacturers of opioids such as Purdue Pharma, Teva, Endo, Cephalon, and Janssen may also be liable for opioid-related damages. Before the 1990s, generally accepted standards dictated that patients should only use opioids short- term for acute pain. The use of opioids for chronic pain was discouraged or even prohibited due to evidence of patients developing a tolerance to opioids which lead to the serious risk of addiction and other side effects. FALSE AND DECEPTIVE MARKETING CLAIMS WE BELIEVE THAT MANUFACTURERS KNEW THEIR DRUGS WERE ADDICTIVE, BUT AGGRESSIVELY MARKETED THEM FOR THE TREATMENT OF CHRONIC PAIN THROUGH DIRECT AND INDIRECT MARKETING. 10 | NATIONAL OPIOID LITIGATION Page 10 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 14 These manufacturers spend MILLIONS OF DOLLARS ON PROMOTIONAL ACTIVITIES AND MATERIALS that falsely deny or trivialize the risks of opioids while OVERSTATING THE BENEFITS of using them for chronic pain. Manufacturers’ false representations include: 1. downplayed the serious risk of addiction, 2. created and promoted the concept of “pseudoaddiction” when signs of actual addiction began appearing and advocated that doctors should treat the signs of addiction with more opioids, 3. exaggerated the effectiveness of screening tools to prevent addiction, 4. claimed that it is easy to manage opioid dependence and withdrawal, 5. denied the risks of higher opioid dosages, and 6. exaggerated the effectiveness of “abuse-deterrent” opioid formulations to prevent abuse and addiction. Manufacturers have also falsely touted the benefits of long-term opioid use, including the supposed ability of opioids to improve function and quality of life, even though no scientifically reliable evidence to support the manufacturers’ claims existed. WHERE ARE THEY MAKING THESE CLAIMS? THEY’RE NOT JUST SELLING ADDICTION QUIETLY IN A DOCTOR’S OFFICE OR AT A MEDICAL CONFERENCE. THEY’RE IN YOUR LIVING ROOM, ON YOUR COMPUTER, AND IN YOUR MAIL. THEY’RE EVERYWHERE YOU ARE. NATIONAL OPIOID LITIGATION | 11 In spite of this evidence, opioid manufacturers have conducted, and continue to conduct, marketing campaigns designed to decrease the fear of prescribing opioids and to encourage and persuade doctors and patients that opioids can and should be used for chronic pain. This resulted in opioid treatment for a far broader group of patients who are much more likely to become addicted and suffer other adverse effects from the long-term use of opioids. Page 11 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 15 The conduct outlined above showing the conduct of manufacturers and distributors of opioids supports several claims for damages. We propose filing lawsuits based on public nuisance, false marketing, RICO, and negligence, among other claims. Through these claims we will demand that the mega-corporations who caused this epidemic fund the clean-up efforts. CAUSES OF ACTION PUBLIC NUISANCE FALSE AND FRAUDULENT MARKETING NEGLIGENCE RICO (RACKETEER INFLUENCED AND CORRUPT ORGANIZATIONS ACT) Manufacturers and distributors of opioids have created an epidemic within our cities and counties and we will demand that they fund the abatement of this nuisance. Manufacturers of opioids may be held liable for their false and fraudulent marketing activities that have directly led to and exacerbated the opioid epidemic. Claims here include negligent misrepresentation, civil conspiracy, fraud and fraudulent misrepresentation. Finally, distributors and manufacturers also face liability for negligence. Federal regulations require distributors and manufacturers of opioids to be on the lookout for, detect, and report suspicious orders of opioids. Distributors and manufacturers violated industry standards of care by breaching their duty to identify and report suspicious opioid orders to the DEA or other relevant state agencies. There is no doubt that these violations directly contributed to the opioid epidemic that is running rampant across the nation, and without question, substantial damages have been incurred by cities and counties. These costs should be borne by the negligent distributor and manufacturer defendants. Additionally, as more information becomes available on the distribution methods of opioid distributors and manufacturers, it becomes clearer that these entities were working hand-in-hand to maximize their profits at the expense of the health and well-being of American citizens. The federal RICO statute is the perfect tool to hold them accountable for the harm they have caused. 12 | NATIONAL OPIOID LITIGATION Page 12 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 16 POTENTIALLY RECOVERABLE DAMAGES The companies’ known violations of these laws give rise to strong claims for significant equitable and monetary relief. Potentially recoverable damages may include: 1. Money wrongfully paid for opioids through government-payor programs including employee insurance, 2. costs for providing medical care, additional therapeutic and prescription drug purchases, and other treatments for patients suffering from opioid-related addiction or disease, including overdoses and deaths, 3. costs for providing treatment, counseling, rehabilitation services, 4. costs for providing treatment of infants born with opioid-related medical conditions, 5. costs for providing welfare or protective services for children whose parents suffer from opioid- related disability or incapacitation, and 6. costs directly associated with law enforcement and public safety relating to the opioid epidemic. Local governments may also be entitled to injunctive relief to prevent further unlawful distribution of these drugs. NEW HEROIN USERS STARTED OUT MISUSING PRESCRIPTION PAINKILLERS (Jones CM. Heroin use and heroin use risk behaviors among nonmedical users of prescription opioid pain relievers - United States, 2002-2004 and 2008-2010. Drug Alcohol Depend. 2013 Sept) FOUR IN FIVE NATIONAL OPIOID LITIGATION | 13 Page 13 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 17 Our Consortium recommends pursuing a damage model that is aggressive, expansive, and encompasses both retrospective and prospective aspects. Our team of experts will help identify the impact of this crisis on your community. A successful outcome would include action to address and end the current opioid crisis in addition to compensating your community for its past and ongoing damages resulting from defendants’ conduct that caused the current opioid epidemic. While they are not exact equivalents, good examples of the type of outcomes which we believe would be successful and achievable may be found in the tobacco and the California lead paint litigation. In both cases, governmental entities were awarded damages as well as ongoing relief to combat what was recognized to be a continuing crisis. Members of our Legal Team were instrumental in the tobacco litigation. The tobacco defendants continue to pay damages on an annual basis, totaling over $200 billion, and the California lead paint defendants have been ordered to fund an abatement fund estimated to be $600 million to $1.15 billion in ten California counties and cities, based on the same public nuisance theory at the heart of our Legal Team’s proposed case strategy. Retrospectively, our lawsuit will seek to recover the funds that your community has already spent addressing the crisis. This will include funds spent on obvious and direct expenses, including: DAMAGE MODEL WHAT IS RECOVERABLE FOR LOCAL GOVERNMENTS? • EMS and other first responders • Drugs such as Naloxone (Narcan) • Medical Examiner expenses • Public Hospital expenses • Increased law enforcement expenses • Drug courts • Increased jailing expenses • Substance abuse programs (including education, prevention, and treatment) • Increased expenses due to Child Welfare and Dependency docket associated with child welfare. 14 | NATIONAL OPIOID LITIGATION Page 14 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 18 Prospectively, our lawsuit will ask (and then answer at trial) the question: “What will it take to put your community and its citizens back into the position it was in before the opioid crisis began – how much will it cost to clean up the mess?” There is no doubt that the target defendants in this litigation have created a public nuisance within your community and we will demand that these defendants foot the bill for abating that nuisance. Our Consortium generally envisions an abatement fund covering three broad areas. First, we believe funding for education is essential. It is important that we get into the school systems and ensure that children understand that the pills in their parent’s cupboards are just as dangerous as a heroin needle. They also need to understand that if a needle goes into their arm one time, it won’t be the last. Second, funding is needed to support law enforcement and jailing so that the community can stay safe while your community works to addressing this crisis. Third, and likely most importantly, to truly have a chance at rehabilitating the community funding is needed for healthcare and additional addiction recovery facilities that will help put an end to the cycle and plague of addiction. This will require extensive resources – and deservedly so. NO UP-FRONT COSTS OUR CONSORTIUM WILL FRONT ALL COSTS OF THE LITIGATION. OUR CLIENTS PAY NO FEE UNLESS WE RECOVER. NATIONAL OPIOID LITIGATION | 15 Page 15 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 19 Now that we know who and what created this epidemic, we need to understand how bad it is. The Manufacturers’ and Distributors’ efforts have been wildly successful. Opioids are now the most prescribed class of drugs. In an open letter to the nation’s physicians in August 2016, the then-U.S. Surgeon General expressly connected this “urgent health crisis” to “heavy marketing of opioids to doctors . . . [m]any of [whom] were even taught – incorrectly – that opioids are not addictive when prescribed for legitimate pain.” This epidemic has resulted in a flood of prescription opioids available for illicit use or sale and a population of patients physically and psychologically dependent on them. When those patients can no longer afford or obtain opioids from licensed dispensaries, they often turn to the street to buy prescription opioids or even non- prescription opioids, like heroin. OF THE OPIOID EPIDEMICSEVERITY GLOBALLY, OPIOID SALES GENERATED $11 BILLION IN REVENUE FOR DRUG COMPANIES IN 2010 SALES IN THE UNITED STATES EXCEEDED $8 BILLION IN REVENUE ANNUALLY SINCE 2009 LIKE BIG TOBACCO, BIG PHARMA HAS ABSOLUTELY HAMMERED RURAL COMMUNITIES WITH A CONSTANT FLOOD OF OPIATES. OVERDOSE DEATHS INVOLVING OPIOIDS by Type of Opioid, United States (2000-2016) (CDC/NCHS, National Vital Statistics System, Mortality. CDC WONDER) ANY OPIOID OTHER SYNTHETICOPIOIDS HEROIN NATURAL &SEMI-SYNTHETICOPIOIDS METHADONE (e.g., fentanyl, tramadol) De a t h s p e r 1 0 0 , 0 0 0 p o p u l a t i o n (e.g., oxycodone, 2000 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 hydrocodone) 16 | NATIONAL OPIOID LITIGATION Page 16 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 20 Between 1999-2013 opioids claimed 175,000 lives and the sales of these prescription drugs have quadrupled. This pales in comparison to the 42,249 DEATHS IN 2016 ALONE. This is 5x higher than in 1999 - and it continues to grow - destroying lives, families, and communities. (CDC, Prescription Drug Overdose data) NATIONAL OPIOID LITIGATION | 17 OPIOID PRESCRIBING We are experiencing the consequences of 25+ years of prescribing more opioids at higher doses. SOURCE: IMS, NATIONAL PRESCRIPTION AUDIT (NPA), 2012 Number of Opioid prescriptions per 100 people 52 - 71 72 - 82.1 82.2 - 95 96 - 143 WA MT ND MN SD WY ID OR CA AZ NV UT CO NM NE IA MO AR LA MS AL GA SC NC VAWV PA NY NJ VT ME NH MA CT RI DE DC FL KS AK HI TX IL WI IN OH MI KY TNOK MD (SOURCE: IMS, National Prescription Audit (NPA), 2012) SOME STATES HAVE MORE OPIOID PRESCRIPTIONS PER PERSON THAN OTHERS BUT EVEN THE LOW AREAS HAVE OVER 50 PRESCRIPTIONS PER 100 PEOPLE.aged 12 years or older in the U.S. misused prescription pain relievers in the past year. Between 1991 and 2016 sales of these prescription drugs have QUADRUPLED. DRUG ADDICTION AND OVERDOSE DEATHS Prescription drug addicts are normal people. They’re our neighbors, our children, our parents, our friends. The harsh reality is that anyone who takes prescription opioids can become addicted to them. In fact, as many as one in four patients receiving long-term opioid therapy in a primary care setting struggles with opioid addiction as a result. And once addicted, it can be hard to stop. A HIGH COST TO OUR COMMUNITIES In the United States, prescription opioid abuse costs are about $55.7 billion annually. (CDC, Prescription Drug Overdose data) $26 BILLION WORKPLACE COSTS (e.g., lost productivity) $25 BILLION HEALTHCARE COSTS (e.g., abuse treatment) $5 BILLIONCRIMINAL JUSTICE COSTS During 2015, an estimated 12,462,000 PERSONS Each day MORE THAN 1,000 people are treated in emergency departments for misuse of opioids. Page 17 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 21 Levin Papantonio | levinlaw.com Levin Papantonio is a nationally recognized litigation firm that has built a reputation on its willingness to litigate to verdict complex disputes against some of the world’s largest companies. The firm routinely litigates cases that require thousands of attorney hours and millions in expenses. The firm pioneered the tobacco litigation and recent victories by Levin Papantonio attorneys in the nationwide DuPont C8 litigation helped bring a $670 million settlement in February 2017. Baron & Budd | baronandbudd.com Baron & Budd, PC was founded in 1977 and has offices in Dallas, Austin, Baton Rouge, New Orleans, Los Angeles and San Diego. Baron & Budd is one of the largest and most accomplished plaintiffs’ law firms in the country. Greene Ketchum | greeneketchum.com Greene, Ketchum, Farrell, Bailey & Tweel LLP is considered one of the most experienced regional firms in the fields of medical malpractice and coal mining accidents. Greene Ketchum played a prominent role in the financing and litigation of thousands of asbestos cases over the past 30 years. Their skilled advocacy has returned millions of dollars in verdicts for their clients in both trial settings and settlements. OUR LEGAL TEAM McHugh Fuller | mchughfuller.com McHugh Fuller Law Group, established in 2006, is a trial firm that specializes in complex litigation and trials in the health and medical fields. The firm functions as an elite trial team made up of experienced litigators and legal writers. The attorneys at McHugh Fuller have tried hundreds of cases, obtaining multi-million-dollar verdicts in courts throughout the country. Hill Peterson | hpcbd.com Founded in 1980, Hill, Peterson, Carper, Bee & Deitzler has extensive legal experience along with a broad network of resources to undertake a wide variety of complicated claims including, but not limited to Mass Torts and Class Action Litigation, Defective Drug Litigation, and Opioid Distribution Liability. Hill Peterson’s attorneys were awarded the prestigious Trial Lawyer of the Year award by Public Justice in 2005 for their work on the successful class action litigation Leach, et al. v. E. I. du Pont de Nemours and Company representing plaintiffs who suffered various cancers and other illnesses due to exposure through drinking water to the chemical ammonium perfluorooctanoate (“PFOA” or “C-8”), a chemical utilized in the manufacture of Teflon. Powell & Majestro | powellmajestro.com Founded in 2002, Powell & Majestro has been a premier resource for clients who want experienced, dynamic legal representation. The firm handles complex litigation including the representation of individuals and others who are victims of consumer fraud or are injured by defective products. Powell & Majestro attorneys are nationally recognized for their work in serious injury claims and have successfully tried numerous civil cases to verdict in state and federal courts. 18 | NATIONAL OPIOID LITIGATION OUR ATTORNEYS Paul Farrell Paul Farrell, Jr. is a trial lawyer and partner at Greene, Ketchum, Farrell, Bailey & Tweel LLP. Mr. Farrell filed the first cases in the country on behalf of public entities against the wholesale distributors of prescription opiates in southern West Virginia and is focusing his efforts to abate the nationwide opioid epidemic. His work has earned him a spot as co-lead counsel in the National Prescription Opiate Litigation MDL. Mr. Farrell is recognized as a premier trial lawyer in the field of medical malpractice and appellate advocacy, making some thirty appearances before the West Virginia Supreme Court. Mr. Farrell filed some of the first transvaginal mesh (TVM) cases in the country and served as liaison counsel on the executive committee for the 7 Pelvic Repair System Products Liability MDLs in Charleston, West Virginia. These MDLs consolidated 80,000 cases and resulted in several multi-million dollar jury verdicts. Mr. Farrell served as trial counsel for the TVM litigation, successfully trying two bellwether cases to verdicts in excess of $20 million. Jeff Gaddy Jeffrey Gaddy is an associate attorney with Levin Papantonio who focuses his practice on mass tort litigation. While with the firm, Mr. Gaddy has worked on pharmaceutical cases involving the diabetes drug Actos, medical device cases involving pelvic mesh implants, and environmental cases like the ones involving C8 contamination. Combined with Mr. Gaddy’s prior career as a prosecutor, he has tried over 100 cases to verdict. In the civil realm, this includes being on a trial team that achieved a $1.6 million verdict in C8 environmental contamination case, and being a member of the trial team of the case that mid- trial brought about the $670 million settlement of the C8 litigation. Page 18 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 22 NATIONAL OPIOID LITIGATION | 19 Peter Mougey Peter Mougey is a shareholder and the Chair of Levin Papantonio’s Securities and Business Litigation department. Recognized as one of Florida’s top 100 trial lawyers and a Florida Super Lawyer in securities litigation, Mr. Mougey has represented hundreds of municipalities and governmental entities. Mr. Mougey currently serves on the Plaintiff’s Executive Committee in the National Prescription Opiate Litigation MDL. In Mr. Mougey’s securities and complex litigation practice, over the last five years, Mr. Mougey has represented many state, municipal, and institutional clients in litigation and arbitration, as well more than one thousand fraud victims in state and federal court and arbitrations across the country. He has recovered hundreds of millions of dollars on behalf of his clients. Mike Fuller Mike Fuller, of McHugh Fuller, has extensive experience in nursing home, medical malpractice and criminal prosecutions and trials. He has worked with a top national law firm and the Hillsborough County State Attorney’s Office in Florida, and he has litigated and tried numerous cases to verdict in jurisdictions nationwide. Part of his educational process was spent working in the White House as an intern involved with Presidential Correspondence, providing a wealth of experience with citizens, legislators, and diplomats across the United States. Mr. Fuller currently serves on the Plaintiff’s Executive Committee in the National Prescription Opiate Litigation MDL. Troy Rafferty Troy Rafferty is a shareholder at Levin, Papantonio. He litigates mass tort, pharmaceutical, and major personal injury cases throughout the country. Mr. Rafferty has been appointed to handle some of the nation’s largest pharmaceutical and mass tort cases. He has been appointed to serve on many Plaintiffs’ Steering Committees including the national Vioxx Litigation which resulted in a $4.7 billion settlement and the national Zyprexa Litigation which resulted in a $700 million settlement. Mr. Rafferty was also one of the leading attorneys in the national Rezulin Litigation. He and his partner obtained a $40 million judgement for a woman who took this diabetes drug. Mr. Rafferty has successfully tried numerous complex pharmaceutical cases throughout the country and currently serves as the Plaintiff’s Co-Liaison Counsel in the National Prescription Opiate Litigation MDL. Roland Tellis Roland Tellis’ practice at Baron & Budd focuses on complex, high-profile litigation, including consumer class actions, financial fraud, business torts, corporate misconduct, automobile defect, food labeling, false advertising, securities fraud, and environmental contamination. He holds leadership roles in numerous multi-state, complex class action cases, including Bias v. Wells Fargo Bank, a certified nationwide RICO class action involving millions of mortgage loans that settled for more than $50 million; In re: Volkswagen “Clean Diesel” Marketing, Sales Practices, and Products Liability Litigation, a multi-state class action in the process of settling with values and fines totaling in the billions of dollars, involving hundreds of thousands of vehicles equipped with “defeat devices” designed to evade emissions laws; and In re: Takata Airbag Products Liability Litigation, which has received preliminary approval for a settlement valued at $553 million. Mr. Tellis currently serves on the Plaintiff’s Executive Committee in the National Prescription Opiate Litigation MDL. James Peterson James C. Peterson is a member/partner at Hill, Peterson, Carper, Bee & Deitzler, PLLC since 1983, focusing his legal practice on litigation of severe personal injury, medical/legal malpractice, product liability, insurance bad faith, mass tort/class action involving defective products, pharmaceuticals, and insurance issues. He served as co-lead counsel for the settlement of the largest pharmaceutical class action litigation in the history of the State of West Virginia, involving the diet drug Fen-Phen. Representative mass tort/class action includes cases against Purdue- Pharma, Inc., et al. (Oxycontin); VIOXX Products Liability Litigation (osteo-arthritic pain medication); and E. I. DuPont de Nemours and Company C-8 Personal Injury Litigation (representation of 3,500 plaintiffs who suffered various cancers and other illnesses due to exposure to C-8, a chemical used in the manufacture of Teflon, in public drinking water which brought a global settlement reached in 2017 for close to $1 billion; Settlements and verdicts handled on behalf of Hill & Peterson or on a co-counsel basis exceeds $1.6 billion. Anthony Majestro Anthony Majestro, managing partner at Powell & Majestro, has a proven record of litigating matters of great complexity nationwide. Mr. Majestro concentrates his practice in prosecuting complex litigation, focusing on consumer fraud and defective products, including defective drugs and medical devices. In the course of his practice, Mr. Majestro has served as class counsel, lead counsel, liaison counsel and in leadership roles in a number of state and national class actions, mass torts, and other complex cases. Mr. Majestro has successfully represented, or is currently representing, clients with injuries caused by Fen-Phen/ Redux, Paxil, Baycol, Propulsid, Oxycontin, Rezulin, Vioxx, hormone replacement drugs, pedicle screws, and breast implants. In addition, Mr. Majestro leads the firm’s extensive consumer protection practice.Page 19 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 23 levinlaw.com baronandbudd.com powellmajestro.com mchughfuller.com greeneketchum.com hpcbd.com Page 20 of 20 Presentation by Attorney Fred Tabak Regarding Ongoing... Packet Page 24