Item Coversheet
Item #4.

Staff Report: 044-22

TO:

Mayor and City Council




FROM:

Eric Holmes, City Manager




DATE:

4/4/2022








SUBJECT


Memorandum of Understanding With Washington Municipalities RE Opioid Litigation
Key Points
  • City Council authorized the City Manager and City Attorney to commence litigation against "Opioid Manufacturers and any other appropriate or necessary persons and/or entities" for tortious conduct in relation to Opioid crisis;
  • The City has been a party in multi-district litigation since 2019;
  • Anticipated verdict in Washington trial involving State & Attorney General's Office suggest a united approach with other Washington local governments is appropriate to facilitate a resolution of dispute and allocation of settlements and/or judgments obtained by verdict. 

Strategic Plan Alignment

Goal 1: Ensure our built urban environment is one of the safest, most environmentally responsible and well maintained in the Pacific Northwest.

 

Goal 3, Objective 3.2: Improve services available to underserved or vulnerable residents.


Present Situation

Since 2015, local governments around the Country have been united in efforts seeking to hold the manufacturers, distributors, and pharmacies of opioids responsible for the harms caused to their residents. The City of Vancouver joined this fight in 2019, filing suit against a number of manufacturers, distributors and pharmacies. That lawsuit was then transferred to the Northern District of Ohio as part of a nationwide multi-district litigation. The lawsuit has been pending there ever since.

 

The City is hopeful that in the coming months, some of these defendants will begin to enter settlement negotiations that will enable state and local governments to recover sums and utilize those amounts to abate the harms caused by opioids. The City's outside counsel has prepared a Memorandum of Understanding for all local jurisdictions to join, which will establish a baseline and default allocation system. The defendants have requested this type of allocation agreement to help spur settlement negotiations. 

 

Under the proposed MOU, the City of Vancouver would ultimately recover roughly 1.73% of moneys allocated to local governments in the State of Washington, as outlined in Exhibit B to the MOU. For example, if a settlement with all defendants yielded a distribution of $173 million to Washington's local governments, the City of Vancouver would be entitled to roughly $3 million, all to be used for opioid abatement purposes as outlined in Exhibit A to the MOU.

 

The MOU does not specify an exact sum for which the City of Vancouver would accept as settlement, but rather established a default allocation structure to facilitate resolution and avoid unnecessary litigation with other Washington and SW Washington jurisdictions.


Advantage(s)
  • Streamlines allocation of settlement funds in opioid litigation.
  • Avoids unnecessary disputes with other Washington local governments

Disadvantage(s)
  • Forecloses (possibly) a greater share of recovery vis-a-vis other Washington local governments, but the City would have to litigate for that result if it was desired.

Budget Impact
  • If a settlement or verdict is reached, budget for police and fire services would be augmented to enable better services for those citizens negatively affected by the opioid crisis.

Prior Council Review
  • Council approved Resolution M-4036 on September 16, 2019, which authorized City Manager and City Attorney to initiate litigation.
  • Executive Session on March 21, 2022.

Action Requested

Authorize the City Manager, City Attorney, and/or designee to execute and approve the "One Memorandum of Understanding Between Washington Municipalities"

 

Dan Lloyd, Assistant City Attorney, 360-487-8500

 


ATTACHMENTS:
Description
MOU - Exhibit A
MOU - Exhibit B
MOU