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High court lets big lead-paint verdict stand, in win for opioid plaintiffs
By ROGER PARLOFF|October 16, 2018
U.S. Supreme Court
Noclip (Wikimedia Commons)
Quick Takeaway
  • A controversial "public nuisance" verdict in California, for hundreds of millions of dollars, will stand.
  • Business groups protested that its "extreme outlier" theory was also being used against opioid makers.

On Monday the US Supreme Court let stand a multi-hundred-million-dollar verdict against three lead paint manufacturers. The failure to intervene boosts the prospects of the more than 1,300 states and municipalities now suing opioid manufacturers on similar legal theories, known as public nuisance laws.

“While public nuisance laws differ in every state, yesterday’s decision is a critical step forward for the national opioid litigation,” said three lead opioid plaintiffs lawyers in a prepared statement today.

“This is a positive outcome for those who believe the ‘law of public nuisance’ . . .  can help support public health in the case of widespread misconduct,” the statement continued. The lawyers who wrote it—Paul T. Farrell, Jr., Paul J. Hanly, Jr., and Joseph F. Rice—compose the plaintiffs’ executive committee for the hundreds of cases that have been consolidated in federal court in Cleveland.

Emails sent to three media representatives of Purdue Pharma, the lead opioid manufacturing defendant, were not returned.

After a six-week trial in March 2014, a California state trial judge found three former lead paint makers—ConAgra Grocery Products, Sherwin-Williams Co., and NL Industries—liable for having created a public nuisance.

The suit had been filed in 2000 by the County of Santa Clara, and was later joined by the nine other most populous cities and counties in the state, including Los Angeles, San Francisco, and San Diego.

Public nuisance is a vaguer, broader claim than a conventional products liability claim. In California it permits a public prosecutor to abate “an actual obstruction of a public right” that “affects at the same time an entire community or neighborhood, or any considerable number of persons.” The obstruction must cause “significant harm” and “its social utility [must be] outweighed by the gravity of the harm inflicted.”

Patients on prescription opioids for a year are at 51 times increased risk for fatal overdose

The trial judge found that the manufacturers had created such a nuisance by promoting the use of lead paint for residential interiors, and he ordered them to pay $1.15 billion into an abatement fund to inspect and repair all homes built prior to 1978. He so ruled, notwithstanding that use of lead paint in that era was common and lawful and, in fact, not infrequently demanded by the federal government and the state of California in their own building contracts of the period.

In November 2017 the state appeals court upheld the verdict, though the panel limited the ruling to houses built before 1951 (at least 65 years before the verdict!). It did so because there had been no proof that any of the defendants had “promoted” the use of lead paint any later than that date. Indeed, much of the advertising at issue in the case occurred in 1930s and early 1940s. (The appeals court also ordered the lower court to pare down the abatement fund accordingly, which hasn’t yet occurred. It is still expected to cost hundreds of millions. NL Industries is now trying to settle its liability for $80 million.)

In seeking Supreme Court review, the companies denounced the verdict as an “extreme outlier” that violated their federal Due Process and First Amendment rights. Represented by top Supreme Court advocates, including former US Solicitor General Paul Clement, they protested that lead paint was lawful at the time and that their marketing of it was not knowingly misleading when made—claims similar to those now being advanced by opioid manufacturers.

There had also been no proof, they claimed, that any home buyer had relied upon the promotional statements. Further, there had been no proof as to which manufacturer’s paint was used in which homes (something impossible to prove decades after the fact).

In fact, since lead paint is not harmful unless interior walls are not maintained properly, they argued that they hadn’t been shown to have caused any harm that may have occurred. Home owners bore responsibility, they argued, for any dangerous circumstances that arose. (Again, opioid manufacturers contend, analogously, that they have not caused the harms of addiction, because of such intervening factors as doctors’ independent exercise of judgment or patients’ misuse of prescribed medication or criminal use of illicit drugs.)

Pro-business groups protested that the allegedly unfair legal theory was also being used to “hold pharmaceutical companies responsible for opioid addiction.”

Repeatedly, moreover, the lead-paint lawyers warned the Court in their briefs that the allegedly unfair legal theory of the case was not an isolated problem, but was now being used to seek “massive recoveries from other industries,” including “holding pharmaceutical companies responsible for opioid addiction.” It referred the Court to a National Review Online article decrying “The Extortion of Big Pharma” in the opioid cases.

Ten pro-business groups, including the US Chamber of Commerce, submitted briefs supporting the lead-paint manufacturers. So did six prominent conservative law professors, who were represented by the law firm of Quinn Emanuel Urquhart & Sullivan, which also represents Purdue Pharma in the opioid litigation.

The attorneys for the California municipalities painted a very different picture of the case, however. In their brief, they maintained that they had proven that each defendant “manufactured, sold, and promoted as safe for interior residential use many tons of lead paint and lead pigments for paint in California during the first half of the 20th century, while having actual, contemporaneous knowledge (hidden from the public . . .)  that lead paint was a deadly poison that caused irreversible, cumulative neurological harm, especially to children.”

Yesterday the Supreme Court denied review without opinion, leaving the verdict in place.

Such denials of discretionary review carry no precedential weight and do not necessarily signal that the Court approves of the outcome of the California lead-paint case. Still, if the Court had taken the case and reversed, it would likely have torpedoed portions of many cities and counties’ cases in the opioid litigation, and would have weakened the plaintiffs’ collective bargaining power as they seek to negotiate a global settlement of those cases.

The first opioid cases are scheduled to go to trial in September 2019 in federal court in Cleveland. They are suits brought by the County of Summit (Akron), County of Cuyahoga (Cleveland), and City of Cleveland, which have been selected as “model” suits from among the more than 1,300 lawsuits consolidated in that court.

The state of Oklahoma’s case—one of at least 25 filed by state attorneys general—is scheduled to go to trial in an Oklahoma state court in May 2019.

Correction: An earlier version of this story provided the wrong date for the commencement of the first federal trials. Also, the story has now been updated to include a statement from the co-lead counsel in the national opioid litigation in federal court. 

Filed under: Litigation