That the City Council approve and authorize the City Attorney's Office, on behalf of the City of La Habra, to participate in any potential settlement from the National Opioid Litigation Case.

In 2018, a legal consortium known as the National Opioid Litigation Consortium (Consortium) filed suit against several opioid manufacturers and distributors. In its lawsuit, the Consortium alleged that business corporations involved in the manufacture and distribution of opioid drugs were responsible for the opioid epidemic in the United States. The Consortium further alleged that these corporations are liable for the increased costs incurred by local governments in addressing the negative effects caused to society associated with opioid use. 

The Consortium extended an invitation to cities across the country to join the litigation.  In the event the lawsuit were successful, participating cities could potentially recover some costs associated with local law enforcement and abatement efforts to address the opioid epidemic.  In April 2019, the City Council authorized the City Manager to enter into a retainer agreement with the law firms of Robins, Kaplan and Andrews and Thornton who were managing the civil suit on behalf of the Consortium.  Legal representation was on a "contingency fee basis," meaning the City did not incur a fee for legal services provided, but would pay a portion of the total recovery fee from any potential award the Consortium may earn as a result of successful litigation.

In July 2021, the Consortium, several State Attorneys General, and four major defendants announced agreement on terms of a proposed nationwide settlement.  These settlements, if agreed to and adopted by all parties, would provide funds to states and political subdivisions, such as local government, to help abate the opioid epidemic across the country. Additional information on the proposed settlement is available at the website https://nationalopioidsettlement.com/ and www.oag.ca.gov/opioids. 

While specifics on a potential settlement, including payment terms, are yet to be determined, local subdivisions have until January 2, 2022, to indicate their desire to participate in any potential settlement. Retained legal counsel has already registered the City of La Habra as a party to the litigation, but the City Attorney's Office has opined that the City Council should nevertheless approve participation in that settlement. In order to protect the City's financial interests in any potential settlement, staff recommends the City Council approve and authorize the City Attorney's office to register the City of La Habra on the National Opioid Settlement website prior to the January 2, 2022 deadline. 

Agencies that choose not to participate by the settlement deadline, but then later seek to participate, will be subject to intense discovery procedures mandated by the Court, which will occur over a relatively short period of time in early 2022, and which would likely be a time intensive exercise for staff.  Retained legal counsel will attend the City Council meeting and be available to address questions from council members regarding potential settlement allocations, how funds may be used, and timing and next steps. 

None.  Pursuant to the terms of the retainer agreement, the City does not incur a fee for legal services provided by the Consortium’s attorneys.  However, in the event the claim is resolved through compromise, settlement, or trial and verdict, the City agrees to pay a portion of the total recovery fee (gross) from any potential award it may receive as a result of the litigation.  That amount could vary from 15 percent to 20 percent of the total recovery, less the deduction of applicable fees and expenses.  There is no fee owed by the City if there is no recovery.