States and Municipalities
Beasley Allen has recovered more than $1.5 billion in settlements and jury verdicts for the states we have represented in Average Wholesale Pricing schemes to defraud the state’s Medicaid programs.
Our firm has represented numerous states throughout the country. These cases have been handled through the Attorneys General and have involved various civil actions. Often, individuals are barred from bringing a consumer fraud type claim, but the state government is not.
These cases may involve financial loss, consumer injury, environmental catastrophe, or a combination. Some of the most notable cases handled by Beasley Allen on behalf of states and municipalities include the AWP/Medicaid Fraud litigation, PFOA water contamination, and BP Oil Spill litigation.
Average Wholesale Price (AWP) / Medicaid Fraud
This litigation alleges several pharmaceutical companies were overcharging state Medicaid programs for prescription drugs. An examination of the pharmaceutical company price lists demonstrates the difference in the AWP and Wholesale Average Cost (WAC), which are the prices provided by the manufacturers for reimbursement and the actual price or cost of the drug. In some cases, the published AWP price was more than 2,500 percent higher than the actual price, and the WAC price nearly 600 percent higher.
Beasley Allen has recovered more than $1.5 billion in settlements and jury verdicts for the states we have represented in these claims. Taxpayer dollars have been returned to the states and the agencies providing services to vulnerable residents. As a result, pharmaceutical manufacturers have completely changed how they conduct business with states and their Medicaid agencies.
PFC Water Contamination
Beasley Allen represents two municipal organizations over the issue of chemical contamination of the towns’ water supplies.
The Water Works and Sewer Board of Gadsden, Alabama, and the Water Works and Sewer Board of the Town of Centre, Alabama, have filed lawsuits against the carpet and textile companies and their chemical suppliers, alleging the companies are responsible for polluting the cities’ water supply.
The lawsuit alleges the defendants are responsible for putting perfluorooctane sulfonate (PFOS) and perfluorooctanoic acid (PFOA) into the raw water supply, causing Gadsden and Centre water to have higher readings for the human-made chemicals.
PFOS and PFOA are human-made chemical compounds used in the manufacture of non-stick, stain-resistant, and water-proofing coatings on fabric, cookware, firefighting foam, and a variety of other consumer products. Exposure to the chemicals over time, even in trace amounts, could promote serious health problems, the EPA warns.
In May 2016, the U.S. Environmental Protection Agency (EPA) issued new lifetime health exposure guidelines for PFOS and PFOA. After the EPA issued the new exposure limits, an advisory warning was provided to eight systems in Alabama, including Gadsden and Centre, and more than 50 nationwide.
Opioid abuse has reached epidemic proportions in the United States. According to the Department of Health & Human Services, 12.5 million people misused prescription opioids, and 33,091 Americans died from opioid overdose in 2015 alone.
These medications provide important pain relief for many. However, over the years, drug companies inflated the effectiveness of delayed-release medications like OxyContin and downplayed their addictive properties, creating conditions ripe for abuse.
In addition to individual cases of serious injury and death related to opioid abuse, Beasley Allen represents multiple local governments in Alabama against both manufacturers and distributors of opioids for increased costs faced by local governments related to the opioid epidemic. Providing city and county resources to battle the opioid crisis causes local governments to sustain economic damages and ongoing significant financial burdens.
These lawsuits allege the crisis was created by the pharmaceutical industry, which instead of investigating suspicious orders of prescription opiates, turned a blind eye in favor of making a profit. They intentionally misled doctors and the public about the risks of these dangerous drugs, and municipal governments are left struggling to cope with the consequences.
BP Oil Spill
On April 20, 2010, a massive offshore oil rig known as the Deepwater Horizon exploded and caught fire in the Gulf of Mexico, about 50 miles from Louisiana’s coastal wetlands. Firefighters and the U.S. Coast Guard fought for 2 days to contain the fire. Still, the rig sank on April 22, releasing nearly a million gallons of diesel fuel into the Gulf waters and creating an unstoppable leak of crude that eventually became the biggest oil disaster the U.S. has ever seen.
The Deepwater Horizon was one of 14 offshore oil rigs owned and operated by Transocean in the Gulf of Mexico. The rig was under lease to oil giant BP for exploratory drilling to the tune of $500,000 per day when the explosion occurred. 126 workers – a combined crew of Transocean and BP employees and independent contractors, were aboard the rig at the explosion. Many of the workers suffered from burn injuries, broken bones, and smoke inhalation – 4 of them critically. Eleven workers were killed.
It took four months to seal the well and stop the flow of oil. The spill is considered the largest human-made environmental disaster in the United States history and one of the largest in world history. As a result, the environmental and commercial impact was unprecedented.
The oil contaminated Louisiana’s fragile wetlands. Environmental experts say that as many as 400 species of Gulf wildlife, from whales to birds, were put at risk, and the threat to the Gulf ecosystem is inestimable. It may be years before the extent of the damage is truly known.
Commercial fishing and shrimping operations all along the spill area were shut down for months, putting hundreds of fishermen already hard hit by the economy out of work. The timing couldn’t have been worse, as the disaster hit the $21 billion commercial seafood industry just before harvesting season in mid-May.
Other industries affected included shipping, tourism, the restaurant industry, real estate, and commercial fishing. According to the National Oceanic and Atmospheric Administration (NOAA), there are 3.2 million recreational fishermen in the Gulf of Mexico region who took 24 million fishing trips in 2008. Commercial fishermen in the Gulf harvested more than 1 billion pounds of finfish and shellfish in 2008.
In August 2010, cases related to the BP oil spill were consolidated under U.S. District Judge Carl Barbier in New Orleans. Beasley Allen attorney Rhon Jones, who heads the firm’s Environmental Law section, was chosen to help direct litigation as a member of the Plaintiffs Steering Committee in the multidistrict litigation. Jones, along with Beasley Allen lawyers Parker Miller, Jenna Day Fulk, and Rick Stratton, also represented Alabama Governor Robert Bentley in the litigation and were also deputized by Alabama Attorney General Luther Strange as deputy attorneys general for the State of Alabama in this case.
In October 2015, Beasley Allen helped the State of Alabama reach a settlement agreement with Transocean, which owned the drilling rig used by BP, for $20 million.
In April 2016, U.S. District Judge Carl Barbier granted final approval to the settlement agreement with BP, reached in principle in July 2015. The settlement totals an estimated $20 billion. It will provide relief to states that suffered environmental damage and economic losses due to the massive oil spill – Alabama, Louisiana, Texas, Mississippi, and Florida. The State of Alabama will receive more than $2 billion in total, including compensation for economic losses resulting from the spill, natural resource damages, and apportionment of the Clean Water Act civil fines and penalties. This is the largest environmental settlement in U.S. history.
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