A veteran New York litigator is taking on opioid makers. They have a history

NEW YORK — The tip came from the doctors. Patients on painkillers were becoming addicted to opioids, even though they said they were taking them as prescribed.

To Paul Hanly, it had the makings of his next big case. On the hunt for patients, his law firm started advertising, and in 2003, it filed its first suits against Purdue Pharma, the maker of OxyContin.

Four years later, with Hanly representing 5,000 pain patients, something unusual happened. Purdue settled. It is one of the few instances — maybe the only one, experts say — in which a drug maker agreed to pay individual patients who alleged that it had underplayed the addiction risk of its medications.

A decade later, the smooth, stylish Hanly has again set his sights on opioid manufacturers, this time on behalf of cities and counties in five states. The drug companies, those plaintiffs allege, sought to create a false perception around opioids, seeding a public health and safety crisis that has cost Hanly’s clients hundreds of millions of dollars.

The crisis has paved the way for an escalating fight against painkiller makers. Seemingly every week, more state, county, and city governments launch lawsuits against the drug companies, a barrage of cases that the plaintiffs compare to the litigation against the tobacco industry that resulted in a historic $246 billion settlement in 1998. The bulk of the work is falling to private attorneys; Hanly has been one of the lawyers at the forefront of the movement.

The scope of the cases is far wider than in Hanly’s original case. The new suits, for instance, target not just Purdue, but other major companies, including Endo Pharmaceuticals, Teva Pharmaceuticals, and Janssen, among others.

The drug makers have plenty of arguments with which to mount a defense, experts say. They can highlight the steps they have taken over the last decade to cut down on the potential for misuse. They can pin the blame on a full lineup of other parties that also played a role in the opioid crisis, from doctors to drug distributors to patients themselves.

But the ferociously competitive Hanly rejects those arguments, and seems to relish the prospect of claiming another told-you-so victory over major corporations.

“There are a lot of arrogant assholes on the other side of these cases,” the 66-year-old Hanly, a former defense attorney himself, said about his work generally. “And for them to tell you you’re never going to get a dime, and then you get a $100 million settlement, it feels pretty good.”

Hanly also sees the cases as a way to help stem the epidemic, associates said.

“He’s wicked smart about this issue, and he has more knowledge about it than anyone in this country, because he’s been doing it for a long time,” said Mike Moore, the former attorney general of Mississippi, who worked with Hanly on the Purdue lawsuit and is representing several states in cases now.

Drug makers have faced accusations that the core of the opioid crisis has their fingerprints on it for more than a decade. They encouraged greater and longer use of their painkillers, critics have contended, and they tried to cover up clinical evidence that their drugs were more addictive than they acknowledged.

But for the most part, faced with patient lawsuits, they prevailed.

Before Purdue settled in 2007, case after case against the drug maker failed. In statements back then, the company bragged about its legal triumphs and vowed that it would never settle, notching each case on its belt when one was thrown out or judges rejected plaintiffs’ arguments.

One challenge: Judges often viewed the patients as drug addicts.

“You would see that in some cases, judges telling people, ‘You have no one to blame but yourself,’” said Richard Ausness, a professor at the University of Kentucky College of Law, who has written about the failure of the lawsuits.

After Hanly and his colleagues started their suits against Purdue in 2003, they deposed dozens of people and accrued millions of pages of company documents. They brought Moore, a veteran of the tobacco lawsuits, onto the team in 2004 after Moore left his post in Mississippi.

Hanly at the time was also representing a former legal assistant from Purdue’s general counsel’s office, who provided information about the company’s inner workings.

Then, as Hanly tells it, the Justice Department caught wind of the civil litigation and asked if he would help with a budding criminal investigation into Purdue. Hanly was happy to assist; because the documents he had gathered were under a protective order, federal officials subpoenaed his firm to get them.

Three years later, in 2007, Purdue paid $75 million to settle the civil case. Separately, the company and three executives pleaded guilty to federal criminal charges that they had misled the government, clinicians, and patients about addiction risks.

Hanly points to two factors that paved the way for a settlement: the pressure of the coinciding criminal investigation, and the resources his firm brought to bear in the case. His firm devoted two dozen lawyers and staff at times and invested millions of dollars in the litigation.

Earlier lawsuits were brought by firms with fewer resources representing just a few patients, Hanly said.

Experts say cities, counties, and states make more sympathetic plaintiffs than individual patients, and a number of states have been able to reach small settlements with drug makers and wholesalers. But there are hurdles they need to overcome in these cases.

Among them: demonstrating that drug makers bear responsibility for the damages. That point needs to be made in the context of a crisis whose roots are multifaceted: Doctors wrote too many prescriptions, drug wholesalers drowned states in pills, and so on. In other words, it’s a long chain from a pharma company’s marketing campaign to hardships suffered by a local government. Similar issues have tripped up lawsuits against gun manufacturers in the past.

“There are so many steps before you get to a bad outcome” for the plaintiffs, said Lars Noah, a law professor at the University of Florida.

Drug makers are also quick to note that their medications are approved by the Food and Drug Administration and regulated by the government — unlike was the case with tobacco. In a motion to dismiss a lawsuit brought by Ohio’s attorney general, for example, Purdue wrote that “the State’s claims against Purdue … are preempted by federal law because they would require Purdue to make statements about the safety and efficacy of its medications that are different” from its FDA approval.

Asked about the cases being pursued by Hanly, Endo, Purdue, and Janssen said they work to help treat patients with legitimate pain and to prevent the misuse of opioids. Janssen added, “we firmly believe the allegations in these lawsuits are both legally and factually unfounded,” and Purdue said, “we vigorously deny the allegations in these lawsuits and look forward to the opportunity to present our defense.”

(Purdue is also appealing a Kentucky judge’s ruling in a case filed by STAT, which would unseal a trove of documents.)

Hanly swats away drug makers’ claims as nonsense. In an interview at his firm’s Manhattan offices, he coolly declared that cities and counties were victims of negligence and fraud perpetrated by drug makers.

He views the legal fight against them as a moral one. He’s gone up against pharmaceutical companies in the past over other issues — he sued the maker of the recalled arthritis drug Vioxx over safety concerns — but that, he said, was different.

“It didn’t involve people’s children going to a party and not coming back because they OD’d,” Hanly said. “It didn’t involve people losing their homes because they started taking Vioxx and couldn’t get off it, which is what happened with opioids.”

Beyond the principle, there’s another incentive, one that Hanly is candid about: His firm, Simmons Hanly Conroy, stands to make millions. He is now representing more than a dozen cities and counties in New York, Connecticut, Pennsylvania, Illinois, and Louisiana, and his firm will make about 25 percent of any money its clients are awarded.

“Do we hope at the end of the day to get a $100 million fee or something like that? Sure,” Hanly said. “But if we don’t, will we say it was not worth it? No.”

He added: “We are morally committed to this in addition to being plaintiffs lawyers who are always looking for the next big litigation.”

Before Hanly became a plaintiffs crusader, he spent many years defending large corporations, a glimpse into the life of the lawyers he now faces off against. He also dipped into intellectual property and art law: He represented the family of painter William H. Johnson in a case against the Smithsonian Institution (“That case didn’t work out,” he said, laughing), and Andy Warhol’s estate.

As a plaintiffs attorney for the past two decades, Hanly has sued pharma companies and financial firms, companies over antitrust violations and a priest who sexually abused Haitian boys. He’s involved in the effort to sue the Saudi government for its alleged role in the Sept. 11 attacks.

In his office, Hanly keeps a collection of Purdue swag, including a plush gorilla with an OxyContin T-shirt and a small calculator touting the company’s sales figures — reminders of how aggressively the company marketed its product. “They’re phenomenal pieces of evidence to show to a jury,” he said.

Hanly has a deep interest in fashion (“Feel this,” he beckoned as he extended his suit sleeve to a reporter for a 1987 story about men embracing bespoke tailoring) and has three children. But beyond that, his life revolves around work. He has a place in Miami Beach, but “it’s a place to go think about cases.”

Whereas top lawyers can come across as cold or intimidating, Hanly puts people at ease, even as he commands whatever room he’s in, attorneys who know him say.

“He has the unique ability to be a very strong and powerful voice for our side, not giving in or compromising, but at the same time, the way he presents that and the respect he gets from the other side, it avoids getting into the personal fights,” said Karen Barth Menzies, a plaintiffs attorney based in California.

“He doesn’t come in the room thinking he’s the smartest guy,” Moore said. “He can be a team player. Not all good trial lawyers can be team players.”

Still, Hanly isn’t bashful about driving his point home. During the interview, he steered questions not directly about the cases back to what he sees as the drug makers’ villainy. When asked whether he foresaw the full extent of the opioid crisis from his earlier work, he said one development that surprised him was that “other drug companies would be so foolish as to adopt essentially the same marketing tactics that Purdue had adopted.”

The way Hanly explains it, some judges will “be in the pocket of big pharma.” Corporate America is “looking for any way to make the playing field unlevel.”

The pharmaceutical industry and its allies have their own view of lawyers like Hanly. The agencies that have hired firms like his to sue drug makers (and in some cases drug distributors) generally do so on the basis that the attorneys will cover the cost of the litigation and then keep a portion of whatever money they can wring from the companies — what’s called a contingency-fee agreement.

Agencies say they don’t have the manpower or resources to handle these cases without help. But in relying on private attorneys, drug makers and some legal groups argue, public officials are effectively deputizing money-hungry law firms. Call it ambulance chasing, just with government contracts. Some of the arrangements have already been challenged in court.

“Lawsuits brought by state or local governments must serve the public interest, and not merely the profit-seeking interests of politically influential members of the plaintiffs’ bar,” Tiger Joyce, the president of the American Tort Reform Association, wrote in a op-ed last month about the opioid cases.

Hanly still keeps about 20,000 pages of documents from his original case against Purdue, stashed in a storage space in New Jersey. It’s what he calls “the cream of the crop.”

Those documents remain under seal, for now. Hanly said he plans to file a motion to unseal them to use in the current lawsuits and, if that fails, he will try to introduce them into the cases to at least make them available to the defense and judges.

Some experts think that, as with tobacco lawsuits, these cases could get bundled — and a global settlement could be reached. But some question just how effective even a massive settlement would be in tackling a problem as pervasive as opioid addiction.

And as more suits are filed, some experts view them as copycat efforts by politicians attempting to show they’re addressing the epidemic, like moths drawn to a cash-flush flame, without making inroads elsewhere.

“It’s just papering over a very serious problem,” said Noah, the Florida law professor. “But it serves the purposes of the players beautifully, and that’s why we have a sudden uptick in these sorts of lawsuits.”

Hanly doesn’t expect a settlement to end the epidemic. But beyond getting his clients back the millions they’ve lost to the crisis, he also hopes that any additional money would go to education and treatment.

And from his days as defense attorney, he knows there’s a point at which companies want to fold.

“I know,” he said, “when the pain is sufficient.”