A bill on Gov. Eric Holcomb’s desk would make it more lucrative for local cities that left the state’s Purdue Pharma lawsuit to rejoin.
Last year, more than 80 Indiana cities and towns, including Franklin and Greenwood, opted out of the state’s lawsuit against Purdue Pharma, maker of OxyContin, and the Sackler family, the company’s owners; Cardinal Health; McKesson; AmerisourceBergen; and Janssen, a subsidiary of Johnson and Johnson.
The $26 billion payout is divided among all states that have joined the lawsuit. Indiana is set to get about $507 million.
Originally, 15% of that was to be divided among all local governments involved in the lawsuit, with the state and Indiana Family and Social Services Administration keeping the rest of the money. That small payout was a major reason the two local cities opted out.
Another sticking point is that local governments would have been forced to abandon other opioid lawsuits they have joined.
Franklin’s city attorney Lynn Gray said the new terms outlined in House Bill 1193 make rejoining the lawsuit a good deal for the city. The bill increases the local government’s portion of the state’s allocation to 50% of the $507 million.
It also allows communities to be part of future or still ongoing legal action against opioid manufacturers or distributors. Additionally, cities can use a portion of their lawsuit winnings to cover legal fees associated with the suit.
The Franklin Board of Works on Monday unanimously approved the city rejoining the lawsuit if Holcomb signs the bill into law. The governor had not signed the bill by Tuesday afternoon, but is expected to sign it in the near future, Gray said.
With the new formula, Gray expects the city to get more than $220,000 from the settlement with Purdue Pharma, the Sacklers, McKesson, Amerisouce Bergen and Cardinal Health. From the Janssen settlement, the city should see more than $51,000, she said.
Attorney fees for both settlements will run about $23,500. The attorney fees are being paid to outside counsel who took on the case on a contingency fee basis, Gray said.
Greenwood officials are still undecided about rejoining the lawsuit, said Shawna Koons, Greenwood’s city attorney.
“HB 1193 has not been signed into law by Gov. Holcomb yet, but the City of Greenwood is aware of the legislation and is weighing its options regarding the opioid settlement, including whether to opt back into the state’s settlement. However, no specific action has been determined at this time,” Koons said in an email Monday.
The amount of the payout is based partially on population, so if Greenwood rejoined, the city’s payout would be even larger than Franklin’s.
Attorney General Todd Rokita wrote a letter to the editor in August 2021 criticizing Franklin and Greenwood for leaving the lawsuit. In part, he said the state was at risk of getting less money because so many cities and towns had left.
The letter also alluded to HB 1193 before it was filed. At that time, he said the plan was to increase the allocation for local governments to 50% of the whole.
“I expressed to all Indiana counties, cities and towns that in this case — like nearly every other — they know how to spend this money better than the state does. I promised them that I would work as hard as I could to secure this reality for them like I have in the past where public monies were secured and shared, so I am pleased to report that is in fact the case again. I am a man of my word — a promise made and a promise kept,” Rokita said in a statement.
It is not clear what the parameters for spending will be, but it will be easy to prove the opioid crisis has impacted Franklin, based on police and fire runs alone, Gray said.
Rokita alluded to what the money might be used for in his statement, and asked more communities to rejoin the settlement.
“As I have been saying in counties, cities and towns for a year now, I encourage all the remaining communities to join the opioid settlement my office secured from the manufacturers and distributors and in doing so, provide much-needed resources to address the drug education, prevention and treatment needs of their residents,” Rokita said in the statement.
The bill extends the opt-in date to July 15, allowing community leaders to reconsider based on the new terms.
Daily Journal reporter Noah Crenshaw contributed to this report.
