This is from the Holland & Knight side of the Blog only.
If you have followed the Blog, then you will know that we have long touted the importance of Erie deference by federal courts sitting in diversity. We have also questioned the expansion of tort law to allow governmental entities to use public nuisance to shift the costs of governmental services to private entities without calling it a tax. We have even discussed the issue of abrogation of common law claims, which can be seen as a lingering source of unchecked liability, when a state enacts a product liability act. For various reasons, however, we have largely declined to comment on the use of public nuisance as the primary theory for governmental entities as plaintiffs in opioid litigation. Today’s post is an exception, and it deals with a pretty significant decision, which we think is overdue.
Although the term “opioid litigation” refers to a wide range of cases in courts around the country, MDL No. 2804, In re National Prescription Opiate Litigation, pending in the Northern District of Ohio since 2017, has been the primary focus. The first bellwether trial case set in that MDL, which drove much of the early discovery and rulings in the litigation, had Cuyahoga County and Summit County, two counties within the Northern District of Ohio, as the plaintiffs. Their claims against manufacturers, distributors, and pharmacies were based principally on public nuisance under Ohio law. So, Ohio’s motto, “The Heart of It All,” has applied to opioid litigation, if not to the underlying social ills that have helped drive it, for quite some time. After the initial bellwether trial case resolved in 2019, the litigation has continued for another five years with too many twists and turns, rulings and reversals, etc., to chronicle here. An admitted over-simplification of one trend in the litigation has been that trial courts were more likely to accept public nuisance as applicable to cases like these—which fundamentally involve the sale, distribution, and dispensing of prescription drugs, even though the damages sought center on the use of street drugs—and appellate courts have been more likely to reverse. Expanding current law to redress a social ill is typically something for a legislature to do, not for a court in the context of a civil case.
Over the years, a number of state legislatures have enacted product liability acts to provide, among other reasons, more predictable frameworks for recovery of damages for the benefits of both manufacturers and consumers. Other provisions in product liability acts, such as limiting or eliminating punitive damages, capping non-economic damages, and providing additional defenses in the case of FDA-approved products, reflect legislative judgments about public policy. Perhaps because of its historic base of manufacturers, Ohio was one of the earlier states to enact a comprehensive product liability act. Predictably, the scope of the OPLA’s abrogation of common law causes of action has since been the subject of a fair amount of litigation, as well as additional legislation.
In 2022, another two counties within the Northern District of Ohio proceeded to trial against certain pharmacy defendants and won a very large verdict under a public nuisance theory. The defendants appealed to the Sixth Circuit based in part on the abrogation of public nuisance claims by the OPLA. The Sixth Circuit, in turn, certified a question to the Ohio Supreme Court pursuant to Fed. R. App. P. 2. It is the resulting Ohio Supreme Court decision in In re National Prescription Opiate Litigation, — N.E.3d –, 2024 WL 5049302 (Ohio Dec. 10, 2024) (“Trumbull,” after one of the county plaintiffs), that we discuss here. You may be asking some version of “Isn’t this a little late for the Ohio Supreme Court to be weighing in on a threshold issue?” If you were, then we agree with you. After all, federal district courts refer questions to state supreme courts less often than federal circuit courts do, but still fairly often. See here, here, and here. The MDL court under could have certified this question to the Ohio Supreme Court pursuant to Ohio S. Ct. Prac. R. Rule 9.01(A), but did not. Instead, back in 2018, in connection with the Summit County case, it ruled that the OPLA did not abrogate public nuisance claims based on the sale and use of a product. In re Nat’l Prescription Opiate Litig., MDL No. 2804, 2018 WL 6628898 (N.D. Ohio Dec. 19, 2018). That decision does not refer to Erie, the concept of deference, or the act of making a prediction. It does refer to the same judge certifying a question to the Ohio Supreme Court in a different case six months earlier. Id. at *36. The certified question in the referenced case involved the interpretation of a different section of the same chapter of the Ohio Revised Code as the OPLA and its abrogation provision. In any event, almost six years later, the Ohio Supreme Court in Trumbull finally had the chance to answer the question that could have been posed originally. The answer, as you may have guessed, was the opposite of what the MDL judge had concluded at least twice before. So, a whole lot of litigating took place, along with plenty of settling, based on a purported claim under Ohio law that does not actually exist according to the highest authority on Ohio law.
At the end, Trumbull’s conclusion that “all common-law public-nuisance claims arising from the sale of a product have been abrogated by” the OPLA was a matter of statutory interpretation that did not require a terribly heavy lift. As we have noted previously, when enacted in 1988, the OPLA was intended to be a comprehensive product liability act and abrogate all common law product liability claims that accrued after a specified date. The Ohio Supreme Court, however, saw some daylight to keep alive certain common law claims. In 1997, it carved out negligent design in Carrel v. Allied Prods. Corp., 677 N.E.2d 795 (Ohio 1997), based on the idea that it was not really a product liability claim. A few years later, it expanded (Trumbull’s term) Ohio common law to allow public nuisance to provide broad relief when a product’s design, manufacture, marketing, or sale “interferes with a right common to the general public.” See Cincinnati v. Beretta U.S.A. Corp., 768 N.E.2d 1136 (Ohio 2002).
In 2005, the Ohio legislature took the step of essentially reversing those cases by adding an abrogation provision to the OPLA stating that the OPLA was “intended to abrogate all common law product liability causes of action.” The next year, to remove any doubt—or so it must have thought—the legislature added another provision stating that “any public nuisance claim or cause of action at common law” based on a product was included within the scope of product liability claims that were abrogated. That history makes it seem pretty straightforward that product-related public nuisance claims were abrogated by no later than 2006—well before the claims asserted by the Ohio counties in the opioid MDL accrued. Consistent with the MDL’s rulings, though, the plaintiffs offered a bunch of arguments why their particular species of public nuisance was not abrogated.
Some of the arguments were quite weak—such as the argument that a legislature cannot eliminate common law claims at all—so we will only address the major ones. Much of Trumbull was taken up with a detailed dive into the introductory language of the abrogation provision added in 2006—added specifically to make sure no court believed the novel Beretta-style public nuisance (Trumbull described it as “unorthodox,” 2024 WL 5049302, *4) survived. The new language added to the definition of a product liability claim (i.e., which common law claims get abrogated) as a standalone paragraph is italicized below:
(13) “Product liability claim” means a claim or cause of action that is asserted in a civil action pursuant to sections 2307.71 to 2307.80 of the Revised Code and that seeks to recover compensatory damages from a manufacturer or supplier for death, physical injury to person, emotional distress, or physical damage to property other than the product in question, that allegedly arose from any of the following:
(a) The design, formulation, production, construction, creation, assembly, rebuilding, testing, or marketing of that product;
(b) Any warning or instruction, or lack of warning or instruction, associated with that product;
(c) Any failure of that product to conform to any relevant representation or warranty.
“Product liability claim” also includes any public nuisance claim or cause of action at common law in which it is alleged that the design, manufacture, supply, marketing, distribution, promotion, advertising, labeling, or sale of a product unreasonably interferes with a right common to the general public.
O.R.C. § 2307.71(A)(13) (emphasis added). Plaintiffs wanted the new language to be read as meaning that public nuisance claims were only product liability claims if they also satisfied the rest of the subsection, particularly involved compensatory damages and arose from product design, warnings, warranty, etc., as set out in (a)-(c). 2024 WL 5049302, *11-12. That construction hinged on “also includes” being interpreting as making the rest of the sentence be a mere example of the existing definition, not an additional definition. But “also includes” in the new language clearly gives an independent definition of a product liability claim centered on nuisance. Id. at *13. The analysis in Trumbull also includes—in the additive sense of the phrase—comparisons to the interpretation of “includes,” “also,” and “also includes” in other statutes if you are into that sort of thing.
Because of Trumbull’s common-sense interpretation of the statute, the purported distinctions of the counties’ claims from the sort of public nuisance claim that was abrogated were of no moment. It did not matter that the counties argued the $650 million award was equitable and not compensatory. Id. at *19. Nor did it matter that the allegedly tortious conduct of the retail pharmacies in dispensing prescription opioids was supposedly not marketing, warnings, instructions, or representations. The alleged conduct clearly fell within the broad list of “the design, manufacture, supply, marketing, distribution, promotion, advertising, labeling, or sale of a product.” Id. at *17-18 & *23. Any public nuisance claims based on the sale or distribution of a product, including the claim the counties had won on at trial against the pharmacies, are not viable in Ohio because they have been abrogated by the OPLA.
Plaintiffs also tried to argue that the legislative history from enacting the language discussed above supported their counter-intuitive interpretation. Resort to legislative history, however, is only appropriate when the statutory language is ambiguous, and this language was not. Id. at *20-21. The actual legislative history was contrary, anyway. The stated purpose of the abrogation of public nuisance claims was broad, and “[n]othing in this statement of purpose suggests that claims abrogated by R.C. 2307.71 are limited to those seeking compensatory damages or involving defective products.” Id. at *22.
The Trumbull court’s final note provides a strong rationale against judges reverse-engineering state law claims, which makes even more sense when applied to a judge sitting in diversity:
We recognize that the opioid crisis has touched the lives of people in every corner of Ohio. The devastation experienced by these private citizens, individually and collectively, undoubtedly has far-reaching consequences for their communities and for the State as a whole. Creating a solution to this crisis out of whole cloth is, however, beyond this court’s authority. We must yield to the branch of government with the constitutional authority to weigh policy considerations and craft an appropriate remedy. And the General Assembly has spoken, plainly and unambiguously: a public-nuisance claim seeking equitable relief is not that remedy.
Id. This rationale also would have made sense six years ago.
There are two things to keep in mind about the Trumbull decision’s likely impact. First, this is not specific to opioid litigation. Ohio law does not support any public nuisance claim tied to any allegation about the design, manufacture, supply, marketing, distribution, promotion, advertising, labeling, or sale of a product. Second, this is a decision on Ohio law based on the specific history of the OPLA. It does not directly impact whether any other state has a cause of action for public nuisance that is linked to a product, whether or not the state has a product liability act that might abrogate a common law claim. However, other state courts may be emboldened to take the unpopular position of ruling that public nuisance cannot be used the way that opioid plaintiffs and others using their playbook want, including in the situation where a federal court has already offered a pro-plaintiff Erie prediction.