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HomeMy WebLinkAbout04/07/2026 07.G. Resolution approve settlement agmt re national prescription opiate litigation 0 ! ♦ !'! !, !:::;5 • '14'1 � F BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT Item No. 7.G. For Meeting of: April 7, 2026 ITEM TITLE: Resolution approving the Settlement Agreement among participating subdivisions and remnant defendants associated with the national prescription opiate litigation lawsuit, Case No. 1:17-md-2804 SUBMITTED BY: Sara Watkins, City Attorney SUMMARY EXPLANATION: A settlement was reached in a federal lawsuit, In re: National Prescription Opiate Litigation. The City was not a named party participant, but under the terms of the settlement, it is eligible for a portion of the settlement. The settlement totals $97,625,000 to individual jurisdictions, payable in one lump sum payment to each jurisdiction after the settlement is approved. As with the other settlements, the City of Yakima is allocated a small percentage—in this case 0.0156479776% (after costs and attorneys' fees are taken from the settlement proceeds). Based on the above percentage (and my math), and the attorney fee and cost Exhibit H, the estimated amount Yakima may receive is $11,487.81. The actual amount may be more or less after the fees and costs are finalized. This is scheduled to be paid out in one installment after the settlement agreement is finalized by the Court. Much like the previous settlements, if the City chooses to settle it agrees to use the funds pursuant to the Settlement Agreement. The categories are essentially the same as the previous agreements entered into by the City with regards to opioid settlements, including, but not limited to: treatment of opioid and substance abuse disorder; prevention; first responder education and training; community regional planning to support efforts to abate the opioid epidemic; and research. Exhibit D below outlines the approved areas of use. To take advantage of the settlements, and receive settlement funds, the City must join the settlements by executing the participation form and agreeing to the terms and conditions of the settlement agreement. Information about the settlement is included in the agenda packet along with the participation form. The Settlement Agreement in full can be found here: https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Execution-Copy182476567.1-1.pdf Exhibit A: List of Actions https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Exhibit-A-List-of-Actions-Execution-Copy182061597.1.pdf 313 Exhibit B: Alleged Harms https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Exhibit-B-Alleged-Harms-Execution-Copy180689799.1.pdf Exhibit C: List of Litigating Subdivisions https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Exhibit-C-List-of-Litigating-Subdivisions-Execution-Copy182492523.1.pdf Exhibit D: List of Opioid Remediation Uses https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Exhibit-D-List-of-Opioid-Remediation-Uses-Execution-Copy180689793.2.pdf Exhibit E: Plan of Allocation: https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Exhibit-E-Plan-of-Allocation-Execution-Copy182525358.1-C.pdf Exhibit F: List of Affiliates: https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Exhibit-F-List-of-Affiliates-Execution-Copy180689798.1.pdf Exhibit G: Participation Form: https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Exhibit-G-Subdivision- Settlement-Participation-Form-Execution-Copy182476553.1.pdf Exhibit H: Attorneys' Fees, Costs, and Expenses: https://nationalopioidsettlement.com/wp-content/uploads/2026/03/Remnant-Defendant-Settlement- Agreement-Exhibit-H-Attorneys-Fees-and-Costs-Execution-Copy181220865.1.pdf ITEM BUDGETED: No STRATEGIC PRIORITY 24-25: A Safe and Healthy Yakima RECOMMENDATION: Adopt Resolution. ATTACHMENTS: Res-Opioid_Settlement_Remnant.docx Remnant.Info.Page.pdf Remnant-Exhibit-G-Subdivision-Settlement-Participation-Form-Execution-Copy182476553.1.pdf 314 RESOLUTION NO. R-2026- A RESOLUTION approving the Settlement Agreement Among Participating Subdivisions and Remnant Defendants associated with the national prescription opiate litigation lawsuit, Case No. 1:17-md-2804. WHEREAS, the City is a non-party participant in the National Prescription Opiate Litigation, cause number 1:17-md-2804 in the United States District Court in the Northern District of Ohio, Eastern Division, and, as a non-party participant is entitled to participate in the Settlement Agreement against the Remnant Defendants; and WHEREAS, a tentative settlement has now been reached with six remnant defendants: Associated Pharmacies, Inc. (and American Associated Pharmacies); J M Smith Corporation; Louisiana Wholesale Drug Company, Inc.; Morris & Dickson Co.; North Carolina Mutual Wholesale Drug Company, Inc.; and United Natural Foods, Inc., in the total amount of $97,625,000.00 to be paid proportionally according to the settlement in one lump sum payment; and WHEREAS, if the City chooses to participate in the settlement it agrees to use the funding for the purposes set forth in the Settlement Agreement, and prioritize the use of the funds, as outlined therein; and WHEREAS, to take advantage of the settlement funding the City must approve said settlement agreements by agreeing to the Settlement Agreement Among Participating Subdivisions and Remnant Defendants, including all of its Exhibits, and filling out and returning the Participation Form for the settlement by the deadline; and WHEREAS, the City Council finds that it is in the best interest of the City of Yakima and its residents to enter into the Settlement Agreement Among Participating Subdivisions and Remnant Defendants; and to secure a portion of the settlement proceeds to be used in the City of Yakima for approved uses as outlined in the Settlement Agreement; now, therefore BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: The City Council of the City of Yakima hereby authorizes the City Manager to sign the Settlement Agreement Among Participating Subdivisions and Remnant Defendants and all of the necessary Participation Forms, and all necessary documents and contracts to effectuate the settlement. ADOPTED BY THE CITY COUNCIL this 7th day of April, 2026. Matt Brown, Mayor ATTEST: Rosalinda Ibarra, CMC, City Clerk 315 National Opioids Settlements: Six Remnant Defendants Notice and Claims Administrator opioidsparticipation@rubris.com To: Yakima city, WA Reference Number: CL-2021042 THIS SETTLEMENT OVERVIEW CONTAINS IMPORTANT INFORMATION ABOUT THE SIX REMNANT DEFENDANTS NATIONAL OPIOID SETTLEMENT SIX REMNANT DEFENDANTS SETTLEMENT OVERVIEW A new national opioid settlement has been reached with six regional distributors/dispenser defendants (Remnant Defendants Settlement): Associated Pharmacies, Inc (and American Associated Pharmacies); J M Smith Corporation; Louisiana Wholesale Drug Company, Inc.; Morris and Dickson Co.; North Carolina Mutual Wholesale Drug Company, Inc.; and United Natural Foods, Inc. (including its subsidiaries SuperValu and Advantage Logistics) (Six Remnant Defendants). There is one settlement agreement covering the combined settlement with the Six Remnant Defendants. If effectuated, the proposed Remnant Defendants Settlement will result in the the Six Remnant Defendants paying a combined $97,625,000.00 in cash for purposes of abating the opioid epidemic. An Eligible Entity's participation in the Remnant Defendants Settlement, the Settlement will result in a one-time settlement payment to each Eligible Entity. The Settlement funds must be used for the Core Strategies and Approved Uses set forth in Exhibit D of the Remnant Defendant Settlement Agreement. The Remnant Defendants Settlement does not include State Attorneys General or any amount allocated to a State. Rather, this Settlement will be distributed only and directly to any Eligible Entity that participates by signing and returning the Combined Subdivision Participation and Release Form by the deadline. The allocation to participating entities will be calculated using the national Denver model but removing from the equation any amount that the Denver model would allocate to a State Attorney General or a State allocation. Specifically, the interstate allocation formula will be used to calculate what amount should go to all the subdivisions in each state and then apply the intrastate allocation as between all subdivisions who are either a litigating subdivision or a non-litigating subdivision with a population of 30,000 or more. Using that methodology, a national pro-rata percentage was created. That allocation percentage of participation is reflected in Exhibit E of the Remnant Defendant Settlement Agreement. o- 30 Fyl 182891755.1 Ot '.316 Eligible Entities must decide whether to participate by Monday, May 4, 2026. WHO IS RUBRIS INC. AND WHAT IS THE NOTICE AND CLAIMS ADMINISTRATOR? The Settlement provides that a Notice and Claims Administrator will provide notice and manage the collection of participation forms. Rubris, Inc. is the Notice and Claims Administrator for this new Settlement and was also retained for the prior national opioid settlements. WHY IS YOUR ENTITY RECEIVING THIS NOTICE? Your entity is eligible to participate in this Settlement. This Notice is also sent directly to counsel for each Eligible Entity if the Notice and Claims Administrator has their information. If you are represented by an attorney with respect to opioid claims, please contact them. WHERE CAN YOU FIND MORE INFORMATION? Detailed information about the Settlement may be found at: https://nationalopioidsettlement.com You are encouraged to review the Settlement Agreement terms and discuss the terms and benefits with your counsel. Each Eligible Entity will need to decide whether to participate in the proposed Settlement, and entities are encouraged to work through this process before the Monday, May 4, 2026, deadline. HOW DO YOU PARTICIPATE IN THE SETTLEMENT? The Settlement requires that each Eligible Entity take affirmative steps to "opt in" to the Settlement. You will receive the Combined Subdivision Participation and Release Form via DocuSign along with instructions from the Implementation Administrator. In order to participate in this Settlement, a person with authority must sign and return the required Combined Subdivision Participation and Release Form. DocuSign remains the preferred method of submission of the needed form. The participation rate will be used to determine whether participation for each Remnant Defendant is sufficient to move forward. If the Settlement moves forward, your release will become effective as to that Remnant Defendant. If the settlement as to any Remnant Defendant does not move forward, the release as to that Remnant Defendant will not become effective. Please add the following email addresses to your "safe" list so emails do not go to spam / junk folders: dse na3@docusign.net and opioidsparticipation@rubris.com. Please monitor your email for the Participation Form and instructions. lqc::,Pr �e. 182891755.1 317 All required documentation must be signed and returned on or before Monday, May 4, 2026. Upon effectuation of the Remnant Defendants Settlement, each Eligible Entity will be provided with a link to a portal where you will enter contact and payment information to receive settlement funds. a x+a �4.r 182891755.1 ❑.: 318 EXHIBIT G Six (6) Remnant Defendants' Combined Subdivision Participation and Release Form ("Combined Participation Form") Governmental Entity: State: Authorized Official: Address 1: Address 2: City, State,Zip: Phone: Email: The governmental entity identified above ("Governmental Entity"), in order to obtain and in consideration for the benefits provided to the Governmental Entity pursuant to the six (6) Remnant Defendants' Settlement Agreement("RDSA"), dated February 23, 2026, and described further in Paragraph 1, and acting through the undersigned authorized official, hereby elects to participate in the RDSA, release all Released Claims against all Released Entities, and agrees as follows: 1. The Governmental Entity hereby elects to participate in the RD S A as a Participating Subdivision with each of the following six (6) Remnant Defendants that are parties to the RDSA: (1) Associated Pharmacies, Inc. (and American Associated Pharmacies), (2) J M Smith Corporation, (3) Morris and Dickson Co., L.L.C., (4) Louisiana Wholesale Drug Company, Inc., (5)North Carolina Mutual Wholesale Drug Company, Inc., and (6)United Natural Foods, Inc. (and SuperValu). 2. The Governmental Entity is aware of and has reviewed the RDSA, understands that all capitalized terms not defined in this Combined Participation Form have the meanings defined in the RDSA, and agrees that by executing this Combined Participation Form, the Governmental Entity elects to participate in the RDSA and become a Participating Subdivision as provided in the RDSAs. 3. The Governmental Entity shall promptly, and in any event no later than 14 days after the Reference Date and prior to the filing of the Consent Judgment, dismiss with prejudice any Released Claims that it has filed against any Released Entity in the RDSA. With respect to any Released Claims pending in In Re National Prescription Opiate Litigation, MDL No. 2804, the Governmental Entity authorizes the Plaintiffs' Executive Committee to execute and file on behalf of the Governmental Entity a Stipulation of Dismissal with Prejudice for each of six (6)Remnant Defendants listed in Paragraph 1 above substantially in the form found at https://nationalopioidsettlement.com/additional-settlements/. 4. The Governmental Entity agrees to the terms of each of the RD S A pertaining to Participating Subdivisions as defined therein. G-1 319 5. By agreeing to the terms of the RDSA settlements and becoming a Releasor, the Governmental Entity is entitled to the benefits provided therein, including, if applicable, monetary payments beginning after the Effective Date. 6. The Governmental Entity agrees to use any monies it receives through the RDSA solely for the purposes provided therein. 7. The Governmental Entity submits to the jurisdiction of the MDL Court and agrees to follow the process for resolving any disputes described in the RDSA. 8. The Governmental Entity has the right to enforce the RDSA as provided therein. 9. The Governmental Entity, as a Participating Subdivision,hereby becomes a Releasor for all purposes of the RDSA, including without limitation all provisions related to release of any claims, and along with all departments, agencies, divisions, boards, commissions, districts, instrumentalities of any kind and attorneys, and any person in his or her official capacity whether elected or appointed to serve any of the foregoing and any agency, person, or other entity claiming by or through any of the foregoing, and any other entity identified in the definition of Releasor, provides for a release to the fullest extent of its authority. As a Releasor, the Governmental Entity hereby absolutely, unconditionally, and irrevocably covenants not to bring, file, or claim, or to cause, assist or permit to be brought, filed, or claimed, or to otherwise seek to establish liability for any Released Claims against any Released Entity in the RDSA in any forum whatsoever. The release provided for in the RDSA is intended by the Parties to be broad and shall be interpreted so as to give the Released Entities in the RDSA the broadest possible bar against any liability relating in any way to Released Claims and extend to the full extent of the power of the Governmental Entity to release claims. The RDSA shall be a complete bar to any Released Claim against the Released Entities. 10. The Governmental Entity hereby takes on all rights and obligations of a Participating Subdivision as set forth in the RDSA. 11. In connection with the releases provided in the RDSA, each Governmental Entity expressly waives, releases, and forever discharges any and all provisions, rights, and benefits conferred by any law of any state or territory of the United States or other jurisdiction, or principle of common law, which is similar, comparable, or equivalent to § 1542 of the California Civil Code, which reads: General Release; extent. A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release that,if known by him or her would have materially affected his or her settlement with the debtor or released party. G-2 320 A Releasor may hereafter discover facts other than or different from those which it knows, believes, or assumes to be true with respect to the Released Claims in the RDSA, but each Governmental Entity hereby expressly waives and fully,finally,and forever settles,releases and discharges, upon the Effective Date, any and all Released Claims that may exist as of such date but which Releasors do not know or suspect to exist,whether through ignorance, oversight, error, negligence or through no fault whatsoever, and which, if known, would materially affect the Governmental Entities' decision to participate in the RDSA. 12. The Governmental Entity understands and acknowledges that nothing herein is intended to modify in any way the terms of any of the RDSA,to which Governmental Entity hereby agrees. To the extent this Combined Participation Form is interpreted differently from the RDSA in any respect, the RDSA controls. I have all necessary power and authorization to execute this Combined Participation Form on behalf of the Governmental Entity. Signature: Name: Title: Date: G-3 321