Tennessee Counties Sue Opioid Makers Using Local "Crack Tax" Law

The US opioid epidemic has continued to worsen in 2017 as super-powerful synthetic opioids like fentanyl and carfentanil taint the nation’s heroin supply. While the FBI’s final tally has yet to arrive, preliminary data suggest that overdose deaths last year eclipsed the 50,000 recorded nationally in 2015 – the most ever. And the body count is expected to be even higher in 2017. As the death toll in some of the hardest-hit areas of the country skyrockets - in some cases forcing county coroners to build larger freezers to store the bodies – states have begun filing lawsuits against the pharmaceutical companies responsible for making and marketing opioid painkillers, in hopes of offsetting the ballooning public-health costs that have been a byproduct of the crisis.

Three Tennessee district attorneys are the latest prosecutors to file suit against the drug makers, joining a group that includes the attorneys general of Ohio, Illinois, Mississippi, New York and Santa Clara and Orange County in California – not to mention the Cherokee Nation. But the Tennessee prosecutors' approach differs from their peers in one unique way:

They are suing under the state’s long-ridiculed and rarely used “crack tax” law, which would hold Big Pharma liable for damages as if they were street-level drug dealers, the Knoxville News Sentinel reported.

While the companies targeted by individual states differ, prosecutors are all alleging similar misconduct: That the pharmaceutical companies leaned on researchers to play down the drugs’ addictive qualities, while spending millions on marketing them to both patients and doctors.

Another lawsuit filed in Washington in January alleged that Purdue Pharma, maker of OxyContin, was aware of the drug’s immense popularity on the streets, but did nothing to curb its distribution.

The suit also names a “Baby Doe” as a plaintiff. “Baby Doe,” the News Sentinel reports, is a boy born in March 2015 addicted to opiates because his mother, identified as “Mary Doe,” was an opiate addict and bought her drugs in Sullivan County, one of the three judicial districts represented in the legal action.

Filed on behalf of the three prosecutors and Baby Doe by Nashville law firm Branstetter, Stranch and Jennings, the lawsuit spends dozens of pages detailing publicly available accounts of alleged fraud and deceptive marketing practices by opiate manufacturers.

It is now beyond reasonable question that the manufacturer defendants’ fraud caused Mary Doe and thousands of others in Tennessee to become addicted to opioids — an addiction that, thanks to their fraudulent conduct, was all but certain to occur,” the lawsuit stated.

Tennessee logs more opiate prescriptions per capita than every state in the nation except West Virginia, the News Sentinel reported. Sullivan County is considered an epicenter, so much so its law enforcement agencies snared their own reality television shows. Shelby County in West Tennessee is also considering joining the lawsuit.

Tennessee Attorney General Herbert Slatery III issued a statement Tuesday in which he said his office is investigating the state's options in pursuing its own legal action.

"Our objective is to identify and hold accountable the parties responsible for this opioid epidemic," the statement read.

That crack tax” – otherwise known as the drug dealer liability statute - was passed in 2005 to allow for civil action against street drug dealers, many of whom were peddling crack.

However, since police typically seize convicted drug dealers’ profits under criminal and civil forfeiture laws – and since most drug dealers go to prison after they’re arrested – there was rarely anything left to be claimed in civil court.

But unlike street dealers, pharma firms are flush with cash. Purdue has annual sales of nearly $3 billion, while Mallinckrodt and Endo also rack up billions each year from sales of opiate drugs.

Many legal experts have said that the current batch of lawsuits resembles the 1998 settlement between the four largest US tobacco companies – Philip Morris, RJ Reynolds, Brown & Williamson and Lorillard – and 46 states attorneys general. In accordance with that judgment, the tobacco companies agreed to pay out more than $200 billion through 2025, with payments to be made in perpetuity.

While states are no doubt in need of financial resources to offset the public-health costs they’re forced to absorb because of the epidemic, pharmaceutical companies have at least one strategy to legally deflect blame: If the showdown ever makes it to trial, defense attorneys will try to slough off as much blame as possible on the overprescribing doctors, like one elderly physician who was arrested earlier this month in New York City and charged with needlessly prescribing millions of pills. 


hoytmonger Fri, 06/16/2017 - 20:21 Permalink

I suppose suing the CIA for drug trafficking would prove futile. Better to shake down big pharma, they have the money. It's kinda like shaking down the big banks for their role in the subprime bust, even though the government was complicit as well.

Never One Roach knukles Fri, 06/16/2017 - 20:49 Permalink

I'm preparing my legal papers right now against Krispy Kreme for suppliig donuts on the street level. My second suit wil be against Fit Bit for reminding me every 30 minutes to get up an dmove from my desk..to get another donut!Krispy Kreme and FitBit are 100% responsible for my obesity (and diabetes, heart diease, stroke, fat donut belly, and emotional distress)!

In reply to by knukles

Sanity Bear zhandax Sat, 06/17/2017 - 01:59 Permalink

That's absolutely hilarious, if miles away from the truth.

I'm in the Deep South and I just looked up a couple of lists of local lawyers and not only do they not fit that pattern, I struggle to find a single Jewish name in any of them.

Clearly if I have any serious legal issues I will be compelled to seek competent representation from out of town.

In reply to by zhandax

jaxville Alt RightGirl Sat, 06/17/2017 - 21:11 Permalink

I am more concerned about them banning Oxycontin.   What about when I am in my mid seventies and something arises that requires powerful pain relievers?  Are they going to be available?  Should I start growing opium poppies so I don't have to deal with this issue?  Between the gov't and the big pharma's , legitimate users are certain to get fucked as far as getting adequate pain relief goes.

In reply to by Alt RightGirl

indygo55 Fri, 06/16/2017 - 20:24 Permalink

taint the nation’s heroin supply"Wow, we need to keep out nations herion supply safe. After all,,,,, we need someone to blame and it ain't gonna be us. Those evil drug manufacturers. Hey, they are already hated so why not? 

Centerist revjimbeam Fri, 06/16/2017 - 21:14 Permalink

Opioid prescriptions are never issued with allocations exceeding what patients actually need to control pain.  The trouble comes about when patients decide to exceed dosages that they are prescribed.  Many are in enough pain to need opioids to control their pain for a while, but some end up addicted.  That isn't a matter of doctors trying to take the easy way out.  That is a result of doctors trying their best to meet the needs of their patients.I know doctors who deal with this.  They take great pains to avoid enabling drug-seeking behavior and also seek non-opioid options for their patients who have long-term chronic pain issues.In the end, individuals need to be held responsible for their own poor choices.  It's time to quit blaming others.

In reply to by revjimbeam

revjimbeam Centerist Fri, 06/16/2017 - 22:32 Permalink

I respectfully disagree. doctors, from my experience, have become nothing but pill and referral mills. my situation is anecdotal, yes, but i believe, indicative of the medical industry. my wife has MS, lupus,(and all that goes with them) 5 herniated discs and severe stenosis. ive been to doctors with her in NY,CO,TX,MS,AR,VT and now FL. prior to the discs being diagnosed, we went to a rheumatologist for her lupus, she was in horrible pain and her left side was numb, the dr gave her a referral to a psychiatrist(one that specializes in backs i presume) and a 30 day supply of norco(90pills), went to the primary where she got a 30 day supply of norco. A steroid shot,and a referral to a pm&r, she got epidural steroid injections (and cushings syndrome as a result...luckily the dr had a good feiend that was an endocrinologist) 3 post dated perscriptions of norco and a referral to a surgeon, and guess what he gave her-norco and a referral ... theyve become mills,man. they collect office visit fees, give you a few pills and ship you off the see one of their friends, so they can collect a fee, give you pills and ship you off.Again, purely anecdotal, and perhaps im jaded because of my expeience, but its not a matter of sometimes individuals need to be held responsible for their 'poor choices' when people are in pain, theyrr scared and vulnerable, not looking to put one over on the man tp catch a cheap buzz, they trust their doctors, because, after all, theyre the experts.Now my wife is still on these pills(9 months now) and have another consultation with the surgeon thursday, having exhausted the referral machine , medical options, and my bank account to boot, her condition has only gotten worse, and need for the pills stronger. I'll check back with you next week, and i will bet you i have in hand a perscription and a referral when scheduling a simple surgery would have sufficed....but surgery is between 90 & 120k, the pills 40bucks...

In reply to by Centerist

playnstocks revjimbeam Fri, 06/16/2017 - 23:11 Permalink

I pinched a nerve in my neck last year, lost feeling in half my hand and pain so bad I could not sleep for more than an hour at a time. Saw 5 Dr's, each gave me a different pill, all non-addictive. Did not help at all, just made me feel sick all the time. Got some Norco, barely helped. The severe pain finally went away after 3 weeks. 9 months later just my pinky is numb slightly. The thing that has helped me the most is Accupuncture, crazy i thought at first but definately helped my pain and numbness. The first visit was like magic I thought. I now go twice a week, and the best part is my co-pay is $7. Try Accupunture for the pain, it was the only thing that helped me - I don't want to live on drugs!        

In reply to by revjimbeam

Centerist revjimbeam Sat, 06/17/2017 - 06:59 Permalink

From the doctors' perspectives, they are doing everything possible to avoid two things--doing surgery until it is a last resort and getting sued.  There is also the modern government-created insurance model that is responsibel.Surgeries rarely are final solutions, and they open patients up to many more complications that can end up being worse than the original problems.  The referrals are all part of getting patients those other treatments.There is also a thing called defensive medicine where doctors have to refer patients for as many tests as possible in order to avoid being sued for not exhausing every option available for treating a patient's condition.  Many tests and procedures really can be unnecessary, but if the referrals for them don't happen, then the doctors can be sued.  Until tort reform happens, this will continue.On the insurance note, compensation is based on very specific insurance coding procedures.  Every single thing that gets done has to be associated with a specific code, or it won't be compensated.  This, in conjunction with the litigious nature of the medical industry, has led to more specialization of disciplines within the medical field and a requirement for a primary care provider to be a central manager of where patients go for each step of treatment.On a final note, years ago, my wife and I went to one of those little walk-in urgent care clinics because she was having some severe muscle spasm in her upper back.  The PA we saw tried to write her a prescription for Oxy.  I flat-out told him, "no" and told him to just give her a prescription for a muscle relaxant.  He followed my instructions, and it all worked out in the end.  Patients do have a responsibility to tell their doctors "no" and to find out what other alternatives are available.  They can also just tear up the prescriptions.Chronic and degenerative diseases are horrible conditions that no one should have to face.  Because many are auto-immune in nature or tied to some other problems, medical technology just can't successfully treat many, and managing pain and other symptoms is the only other option.  I wish the best for you and your wife.

In reply to by revjimbeam

revjimbeam Centerist Sat, 06/17/2017 - 10:13 Permalink

Thank you, thats very kindI agree with everything you said, and only excluded them for the sake of brevity. yes, to the fear if litigation. yes, to the insurance model(my wifes career was in hospital billing) and yes, to patient responsibility Those are some of the myriad reasons they have become mills, in my opinion, centrist. I saw further down on this board, someine questioning how poor southerners afford these medications and whatnot, well, the south is primarily physical labor and has the highest disability rate as a result(i also am aware it is the holy grail to some-our thoughts on this im sure are quite aligned)So it goes back to billing, primarily medicare, the default insurance of the retired and disabled. The doctors are simply not getting paid what their knowledge and skill set entitles them to be paid, so many times they look for alternative, less expensive procedures, a band-aid if you will. now in full disclosure, my wife is on medicare being 100% diabled(cutest damn little 5ft 100lb woman i ever met, and prior to this back issue never took anything atronger than gabapentin for two very painful disorders)she had insurance but dropped it because medicare is always billed first for some retarded reason so i pay the remaining 20% in cash. Also, most people dont have the capabilities or time to understand the intricacies and nuances of this system, nor the ability to understand complex diagnosis and research alternative treatments. they just do as they are told and more often than not, its painkillers that get them from one appointment to the next-im very curious to see opiod perscriptions for medicare/diability users compared to those with private insurance *with comparable injuries, but im typing this on my phone,and frankly to lazy to look it up- now thats not a slam on the great unwashed, most people are just too busy with life to pursue knowledge such as we on zerohedge, its a luxury they just dont have time for. i understand full well the mentality 'buck up and handle your shit yourself' and agree with it, but to blame the.'poor choices'of one thrust into a system thats beyond their control, and as i believe, meant to foster dependency by sociopaths referencing spreadsheets and actuary tables, i wholeheartedly disagree with. the sins of the few appear to be visited on the many.  *Edit*on a side note, she too, was given a perscription for muscle relaxers first, skelaxin($437 for a 30 day supply) but in fla is not covered by insurance because 'old people fall when they take them' and was then given the norco as the alternative... 

In reply to by Centerist

Alfred Centerist Sat, 06/17/2017 - 10:27 Permalink

Everything has a beginning and an end. When pain killers are prescribed in the acute phase of an injury, it should be assumed that addiction is a side affect. After the acute phase, the treatment plan should include opiate withdrawal, supervised by the physician.Instead, the nanny state, because they know more about this than doctors, require the physician to stop or limit the prescription. This causes the patient to seek 'treatment' for their newly acquired addiction from other sources. And it goes on from there.L4/L5 herniated discs are excruciatingly painful. Have one?His name was Seth Rich 

In reply to by Centerist

Common_Law Fri, 06/16/2017 - 20:30 Permalink

Yay, more cival persecution!  It always starts out as well intentioned. They could have used this to fine people for taking a shit if the FDA hadn't changed their mind about the legal classification of stool...Yes, the govt regulated all your shit, literally, until the shitstorm of push back.

Endgame Napoleon Common_Law Fri, 06/16/2017 - 20:50 Permalink

What I want to know is this: how are people in the market for this excess consumption of pharmaceuticals? Southern states have very low wages, like between $9 and $12/hr for office work, including for many college grads, although many (most) employers prefer people without degrees and/or legally required licenses, assuming they have welfare/taxfare, a spousal income or child support to cover their major household bills, enabling them to work for rock-bottom pay. You are in a bad situation in the South when one earned-only income stream needs to actually cover your household bills, all of them, without monthly welfare to cover rent and groceries and Child Tax Credit checks up to $6,269. Many jobs in the South do not include health insurance, which, presumably, would give these people greater access to the substances they are abusing.

In reply to by Common_Law

Vilfredo Pareto Endgame Napoleon Fri, 06/16/2017 - 21:58 Permalink

Medicaid and Medicare disability peeps sell their prescriptions to supplement their income.  Here is how it goes down.  Your dealer is the perfect patient.  Never misses an appointment.  Never "loses" meds or gets the meds "stolen.".  Never asks for an early refill.  Has no complaints on the visit, denies any side effects, says the medicine works great, is happy with a five minute visit and pays all bills promptly. Lol.  How are you going to spot that?  

In reply to by Endgame Napoleon

MrBoompi Fri, 06/16/2017 - 20:31 Permalink

Synthetic and semi-synthetic opioids are prescribed everywhere and cause a lot of addiction problems, but pot is still mostly illegal.  Par for the course in America.  Whatever makes the most money is what's important you know.  

shovelhead MrBoompi Fri, 06/16/2017 - 22:40 Permalink

Because just about anyone who is willing to do a little botany and chemistry homework can grow killer weed while manufacturing syn opioids is a lot more homework and lab equipment and very difficult to access the base compounds.Growing free weed is illegal but buying hard dope from your state licensed pusherman is okie dokie.No independent do it yourselfers allowed. 

In reply to by MrBoompi

moonmac Fri, 06/16/2017 - 20:39 Permalink

Sick 6 year olds know when you start feeling better you stop taking medicine why can't grown adults stop using when they start feeling better after surgery? Because there's always someone else to blame.People who make drugs that's between them and God.People who sell drugs that's between them and God.People who use drugs that's between them and God.When did man become God?

sschu moonmac Fri, 06/16/2017 - 21:31 Permalink

I am sorry for your (and all the rest on this thread) lack of compassion for those in greatest need.  Check my post below, watch this stuff and learn and then come back.  I hope you have a different perspective, because that is what it will take to defeat this demon.  sschu 

In reply to by moonmac

gold rubeberg Fri, 06/16/2017 - 20:44 Permalink

More senselessly misdirected litigation. The drug companies aren't forcing these prescription chemicals into users. Just because they're frustrated with the difficulty of nailing the real culprits, just because the companies have deep pockets, doesn't justify hapless, greedy litigation that misses the mark.

Politicians, bureaucrats and lawyers run amok.

Centerist gold rubeberg Fri, 06/16/2017 - 20:57 Permalink

Right on.  I'll expand on your theme by responding to the stated purpose of this misuse of power:"'Our objective is to identify and hold accountable the parties responsible for this opioid epidemic,' the statement read."The responsible parties are the individuals who misuse the medications--period.  The best way to hold them accountable is to stop using public funding to treat them when they overdose.  If the government wants to seize assets, then they should seize them from those who end up having their lives saved by hospitals at no personal cost.

In reply to by gold rubeberg

Amicus Curiae shovelhead Sat, 06/17/2017 - 07:53 Permalink

theres an injection called Pentosanit actually does help cartiledge regrowits used widely on horses and for  pets with RA and joint issuestrial in aus on people with bad knees/cartiledge issues got good resultshoweverthey took it no further for human approvalsis  possibly THE safest NSAID aroundits unlike the vioxx celbrex rimadyl etc types

In reply to by shovelhead

BidnessMan Fri, 06/16/2017 - 20:52 Permalink

Gordon Gekko would be embarrassed by Big Pharma. $600 for an EpiPen that cost at most $30 to make is just the tip of the iceberg. Did some Pharma sales software training 20+ years ago, and it was the Delta house at a gold-plated resort. Time to starve those leaches.