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Moody and hospital districts are in a legal battle over opioid settlements

Oxycodone pills.
Marie Hickman
Getty Images
The hospital districts have pursued claims against pharmaceutical-industry companies because of the opioid epidemic.

Sarasota Memorial Health Care System and Lee Health said they are not “subordinate” to the attorney general, as they were created by the Legislature.

Attorney General Ashley Moody’s office this week pushed back against two public hospital districts battling Moody about settlements with pharmaceutical industry companies over the opioid epidemic.

As part of a flurry of filings in Leon County circuit court, Moody’s office disputed arguments by the Sarasota County Public Hospital District and Lee Memorial Health System that Moody had reached settlements that would improperly scuttle the districts’ separate legal claims against the industry.

“The hospital districts imperil the receipt and/or distribution of at least millions of dollars of settlement funds from the opioid settling defendants (industry companies) to the state of Florida to abate the opioid crisis,” lawyers in Moody’s office wrote in one document. “The state of Florida has recognized the serious problems posed by the opioid crisis, which require the urgent deployment of significant resources to abate the crisis in Florida.”

But in a July 15 filing, the hospital districts, which do business as the Sarasota Memorial Health Care System and Lee Health, said they are not “subordinate” to the attorney general, as they were created by the Legislature. In part, they argued Moody is violating the districts’ due-process rights.

“Specifically, the attorney general has agreed by contract to extinguish, settle, dismiss and release any of the claims of the hospital districts against the opioid manufacturers, distributors and dispensers … without providing any notice to the hospital districts of the agreement — let alone to provide the hospital districts with an opportunity to be heard before taking such action,” the districts’ attorneys wrote.

Moody’s office filed a lawsuit April 6 in Leon County circuit court against the Sarasota and Lee hospital districts, the North Broward Hospital District, Halifax Hospital Medical Center, the West Volusia Hospital Authority and the Miami-Dade School Board. The West Volusia district later was dismissed from the case, but the South Broward Hospital District and the Putnam County School Board were added.

The hospital districts and school boards have pursued claims against pharmaceutical-industry companies because of the opioid epidemic.

In the lawsuit, Moody’s office is seeking a ruling that it has the power to essentially override the claims by the hospital systems and the school boards. The lawsuit said settlements reached by Moody’s office require releasing claims from government agencies that are considered “subdivisions” of the state.

The Sarasota and Lee districts filed a counterclaim against Moody’s office. The districts’ July 15 court document said their claims against companies such as Johnson & Johnson, Endo Pharmaceuticals Inc.; CVS Pharmacy, Inc.; Teva Pharmaceutical Industries, Ltd.; Allergan-affiliated companies; and Walgreens could be worth more than $100 million.

Moody’s office has reached settlements with those companies, along with AmerisourceBergen Corp.; Cardinal Health, Inc.; and McKesson Corp. Some settlements resulted from multi-state litigation, while others came as a result of a lawsuit that Moody’s office filed in Pasco County.

The lawsuit that Moody’s office filed in April in Leon County said the settlements will provide money for opioid treatment, prevention and recovery services and that money would go to communities throughout the state. The sizes of the settlements vary but stretch into the hundreds of millions of dollars.

The attorney general’s filings this week, in part, tried to rebut arguments that the Sarasota and Lee districts made in the counterclaim. As an example, Moody’s office sought dismissal of an argument that overriding the districts’ claims against the pharmaceutical-industry companies could be an unconstitutional “taking” of property.

“Not only is the cause of action novel, these two hospital districts seek relief in excess of $100 million,” Moody’s lawyers wrote. “Regrettably, by bringing this claim, the hospital districts — who, again, are government entities established for the sole purpose of serving public health policy — blatantly elevate their own financial interests over statewide public health policy.”

But in the July 15 filing, the hospital districts said they are not assured of getting money from the state settlements.

“The hospital districts deny that any funds in any existing settlement agreement benefit the front-line defenders in the opioid crisis — namely, the hospital districts,” the filing said. “No funds whatsoever are allocated to the hospital districts who, by definition, bear the brunt of the costs of the opioid crisis.”

Copyright 2022 Health News Florida

Jim Saunders is the Executive Editor of The News Service Of Florida.