HomeMy WebLinkAboutResolution No. 2023-C17RESOLUTION NO. 2023-C17
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF AZUSA
CALIFORNIA AUTHORIZING THE CITY MANAGER TO ENTER
INTO THE SETTLEMENT AGREEMENTS WITH WALGREENS CO.,
WALMART, INC., CVS HEALTH CORPORATION/CVS PHARMACY
INC., TEVA PHARMACEUTICAL INDUSTRIALS LTD., AND
ALLERGAN FINANCE LLC/ALLERGAN LIMITED, AGREE TO THE
TERMS OF THE STATE-SUBDIVISION AGREEMENTS, AND
AUTHORIZE ENTRY INTO THE STATE-SUBDIVISION
AGREEMENTS WITH THE ATTORNEY GENERAL
WHEREAS, the United States is facing an ongoing public health crisis of opioid abuse,
addiction, overdose, and death, forcing the State of California and California counties and cities
to spend billions of dollars each year to address the direct consequences of this crisis; and.
WHEREAS, pending in the U.S. District Court for the Northern District of Ohio is a
multidistrict litigation (“MDL”) being pursued by numerous public entity plaintiffs against the
manufacturers and distributors of various opioids based on the allegation that the defendants’
unlawful conduct caused the opioid epidemic; and.
WHEREAS on or about November 14, 2022, a proposed nationwide tentative settlement
was reached between the plaintiffs in the MDL and Walmart Inc. (“Walmart”); and.
WHEREAS on or about November 22, 2022, a proposed nationwide tentative settlement
was reached between the plaintiffs in the MDL and Teva Pharmaceutical Industries Ltd. and all
of its respective past and present direct or indirect parents, subsidiaries, divisions, affiliates, joint
ventures, predecessors, successors, assigns, including but not limited to Teva Pharmaceuticals
USA, Inc., Actavis LLC (f/k/a Actavis Inc.), Actavis Elizabeth LLC, Actavis Kadian LLC,
Actavis Pharma, Inc. (f/k/a Watson Pharma, Inc.), Actavis Kadian LLC, Actavis Laboratories
UT, Inc. (f/k/a Watson Laboratories, Inc. - Utah), Actavis Mid Atlantic LLC, Actavis Totowa
LLC, Actavis Laboratories FL, Inc. (f/k/a Watson Laboratories, Inc. - Florida), Actavis South
Atlantic LLC, Warner Chilcott Company LLC, and Watson Laboratories, Inc., and Anda Inc.
(collectively, “Teva”); and.
WHEREAS on or about November 22, 2022, a proposed nationwide tentative settlement
was reached between the plaintiffs in the MDL and Allergan Finance, LLC (f/k/a Actavis, Inc.,
which in turn was f/k/a Watson Pharmaceutics, Inc.) and Allergan Limited (f/k/a Allergan pic,
which, in turn, was f^k/a Actavis plc)(collectively, “Allergan”); and.
WHEREAS, on or about December 9, 2022, a proposed nationwide tentative settlement
was reached between the plaintiffs in the MDL and CVS Health Corporation and CVS
Pharmacy, Inc. and all of their past and present direct and indirect parent and subsidiaries
(collectively, “CVS”); and.
WHEREAS, on or about December 9, 2022, a proposed nationwide tentative settlement
was reached between the plaintiffs in the MDL and Walgreen Co. (“Walgreens”); and,
WHEREAS, CVS, Teva, Walgreens, Walmart, and Allergan shall be referred in this
Resolution as “Settling Defendants”; and
WHEREAS, as part of the settlements with the Settling Defendants, local subdivisions,
including certain cities, that are not plaintiffs in the MDL may participate in the settlements in
exchange for a release of the Settling Defendants; and.
WHEREAS, copies of the proposed terms of those proposed nationwide settlements
have been set forth in the Master Settlement Agreements with the Settling Defendants; and.
WHEREAS, copies of the Master Settlement Agreements have been provided to the City
Council with this Resolution; and,
WHEREAS, the Settlement Agreements provide, among other things, for the payment of
a certain sum to settling government entities in California including to the State of California and
Participating Subdivisions upon occurrence of certain events as defined in the Settlement
Agreements (“California Opioid Funds”); and,
WHEREAS, California local governments in the MDL have engaged in extensive
discussions with the State Attorney General’s Office (“AGO”) as to how the California Opioid
Funds will be allocated, which has resulted in the Proposed California State-Subdivision
Agreements Regarding Distribution and Use of Settlement Funds (“Allocation Agreements”)
from the settlements with the Settling Defendants; and.
WHEREAS, copies of the Allocation Agreements for all of the settlements with the
Settling Defendants have been provided with this Resolution; and.
WHEREAS, the Allocation Agreements allocate the California Opioid Funds as follows:
15% to the State Fund; 70% to the Abatement Accounts Fund; and 15% to the Subdivision Fund.
For the avoidance of doubt, all funds allocated to California from the Settlements shall be
combined pursuant to the Allocation Agreements, and 15% of total from each settlement shall be
allocated to the State of California (the “State of California Allocation”), 70% to the California
Abatement Accounts Fund (“CA Abatement Accounts Fund”), and 15% to the California
Subdivision Fund (“CA Subdivision Fund”); and.
WHEREAS, under the Master Settlement Agreements, certain local subdivisions that did
not file a lawsuit against the Settlement Defendants may qualify to participate in the settlements
and obtain funds from the Abatement Account Fund; and,
WHEREAS, the City is eligible to participate in the Settlement and become a CA
Participating Subdivision; and,
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WHEREAS, the funds in the CA Abatement Accounts Fund (the 70% allocation) will be
allocated based on the allocation model developed in connection with the proposed negotiating
class in the National Prescription Opiate Litigation (MDL No. 2804), as adjusted to rellect only
those cities and counties that are eligible, based on population or litigation status, to become a
CA Participating Subdivision (those above 10,000 in population). The percentage from the CA
Abatement Accounts Fund allocated to each CA Participating Subdivision is set forth in
Appendix 1 to the Allocation Agreements and provided to the City Council with this Resolution.
The City’s share of the CA Abatement Accounts Fund will be a product of the total in the CA
Abatement Accounts Fund multiplied by the City’s percentage set forth in Appendix 1 of the
Allocation Agreements (the ''Local Allocation”); and,
WHEREAS, a CA Participating Subdivision that is a city will be allocated its Local
Allocation share as of the date on which it becomes a Participating Subdivision. The Local
Allocation share for a city that is a CA Participating Subdivision will be paid to the county in
which the city is located, unless the city elects to take a direct election of the settlement funds, so
long as; (a) the county is a CA Participating Subdivision, and (b) the city has not advised the
Settlement Fund Administrator that it requests direct payment at least 60 days prior to a Payment
Date; and,
WHEREAS, it the intent of this Resolution is to authorize the City to enter ^into die
Master Settlement Agreements with the Settling Defendants by executing the Participation
Agreements and to enter into the Allocation Agreements by executing the signature pages to
those agreements.
THEREFORE, BE IT RESOLVED, that the City Council of the City of Azusa
does hereby take the following actions:
SECTION 1. The facts set forth in the Recitals, above, are true and correct and are
hereby adopted in support of this Resolution.
SECTION 2. The City Manager is authorized to settle and release the City s claims
against the Settling Defendants in exchange for the consideration set forth in the Settlement
Agreements and Allocation Agreements, including taking the following measures:
The execution of the Participation Agreements with the Settling Defendants and
any and all documents ancillary thereto.
NOW
1.
The execution of the Proposed California State-Subdivision Agreement Regarding
of Settlement Funds with the Settling Defendants by executing the
2.
Distribution and Use
signature pages to those Allocation Agreements.
3. Notify the Settlement Fund Administrator that the City requests a direct payment
under the Allocation Agreements at least 60 days prior to the Payment Date in the Settlement
Agreements.
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SECTION 3. CEQA. That the City Council finds this Resolution is not subject to the
California Environmental Quality Act (CEQA) in that the activity is covered by the general rule
that CEQA applies only to projects which have the potential for causing a significant effect on
the environment. Where it can be seen with certainty, as in this case, that there is no possibility
that the activity in question may have a significant effect on the environment, the activity is not
subject to CEQA.
SECTION 4. Severability. If any provision of this Resolution or the application thereof
to any person or circumstance is held invalid, such invalidity shall not affect other provisions or
applications, and to this end the provisions of this Resolution are declared to be severable.
SECTION 5. Effective Date. This Resolution shall become effective immediately.
PASSED, APPROVED and ADOPTED this 20™ day of March, 2023.
C i/
Rob^t
Mayor
'nzales
ATTEST:
C
lice Cornejo, iff
City Cleric
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STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
CITY OF AZUSA
)
) ss.
)
I HEREBY CERTIFY that the foregoing Resolution No. 2023-C17 was duly
adopted by the City Council of the City of Azusa, at a meeting thereof held on the 20'*^ day
of March 2023, by the following vote of the Council:
COUNCILMEMBERS: GONZALES, MENDEZ, ALVAREZ, AVILA, BECKWITH
COUNCILMEMBERS: NONE
COUNCILMEMBERS: NONE
COUNCILMEMBERS: NONE
AYES:
NOES:
ABSENT:
ABSTAIN:
ity Clerk
APPROVED AS TO FORM:
Marco A. Martinez I
City Attorney
CbP — A
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