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In re National Prescription Opiate Litigation

United States District Court, N.D. Ohio, Eastern Division

September 4, 2019




         Before the Court are the Manufacturers' and Distributors' Motion for Partial Summary Judgment on Statute of Limitations Grounds (Doc. #: 1896) and Pharmacy Defendants' Motion for Summary Judgment Based on the Statute of Limitations (Doc. #: 1874). For the reasons stated below, both motions are DENIED.

         I. Introduction.

         Defendants assert undisputed evidence establishes that Plaintiffs, County of Cuyahoga and County of Summit, knew or should have known facts sufficient to permit them to assert their claims long before their original Complaints were filed on October 27, 2017 and December 20, 2017, respectively. (Doc. #: 1896-1; Doc. #: 1874). In response, Plaintiffs contend none of their claims fail on limitations grounds, either because: (1) there is no limitations period applicable to the claim; or (2) there exist material fact questions concerning the claim's accrual dates, whether Plaintiffs exercised reasonable diligence to discover facts necessary to bring suit, and the applicability of tolling doctrines. (Doc. #: 2122-1).

         There are three categories of Defendants ‒ Manufacturers, Distributors, and Pharmacies ‒ and they seek to assert the statute of limitations defense in different ways. Manufacturers and Distributors seek only to preclude Plaintiffs from recovering damages based on conduct pre-dating October 27, 2012. This date was calculated by counting back five years from October 27, 2017, which is the date Cuyahoga County-the first-filing Plaintiff-filed its original complaint. The five-year look-back is based on the five-year limitations period applicable to OCPA claims. See Ohio Rev. Code (“O.R.C.”) §2923.34(J). (Doc. #: 1896-1 at 1-4, 12-25).[1] Manufacturers and Distributors do not seek to bar claims based on conduct that occurred within the five-year look-back period. (Id. at 1).

         In contrast, Pharmacy Defendants, which are sued only in their capacity as distributors, move separately for dismissal of claims that accrued shortly before or after they allegedly ceased distribution of prescription opioids. The Pharmacies adopt Manufacturers' and Distributors' arguments regarding the accrual rules, applicable statutes of limitations, tolling doctrines, and what Plaintiffs allegedly knew or should have known prior to October 27, 2012. (Doc. #: 1874 at 1).

         As discussed below, the Court concludes Defendants' arguments fail with regard to several of Plaintiffs' claims as a matter of law and undisputed fact, either because there simply is no applicable statute of limitations (in claims for public nuisance and for equitable relief under RICO), or it is clear that the limitations period has not run (in Plaintiffs' OCPA claims).

         As to Plaintiffs' other claims (for damages under RICO and for civil conspiracy), Defendants make strong arguments that the applicable limitations period expired after these claims accrued and before Plaintiffs filed suit. Ultimately, however, given the enormous volume and complexity of facts relevant to the parties' positions, the Court concludes summary judgment is not the appropriate vehicle for resolving questions regarding the dates these claims accrued or the periods they were tolled. That is, claim-accrual date issues, and questions of tolling, are appropriately determined only after a presentation of all the evidence at trial. Because the existing record demonstrates material factual disputes on these issues, the Court cannot conclude the evidence “is so one-sided that [Defendants] must prevail as a matter of law.” See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986); Iron Workers Local Union No. 17 Ins. Fund & Its Trustees v. Philip Morris Inc., 29 F.Supp.2d 801, 805 (N.D. Ohio 1998) (“The statute of limitations issues are best decided by a jury at trial.”). In so ruling, the Court notes that, at trial, it will have an opportunity to reevaluate the sufficiency of the evidence and nothing in this Order prevents the Court from granting judgment as a matter of law, if warranted. See Fed. R. Civ. P. 50.

         II. Applicable Statutes of Limitation.

         The limitations periods applicable to Plaintiffs' five different types of claims are discussed below.[2]

         A. Common law absolute public nuisance.

         Defendants contend Plaintiffs' common law absolute public nuisance claims are governed by Ohio's four-year statute of limitations applicable to “certain torts.” See O.R.C. § 2305.09. (Doc. #: 1896-1 at 5). Plaintiffs respond that no statute of limitations applies to these claims. (Doc. #: 2212-1 at 1 n.2, 17-19). For the reasons detailed below, the Court agrees with Plaintiffs.

         A nuisance is the “wrongful invasion of a legal right or interest.” Taylor v. Cincinnati, 55 N.E.2d 724 (Ohio 1944); Kramer v. Angel's Path, L.L.C., 882 N.E.2d 46 (Ohio Ct. App. 2007). Ohio law recognizes two varieties of Ohio public nuisance claims-“absolute” and “qualified.” Each is based on differing types of alleged conduct and each requires different elements of pleading and proof. See, e.g., City of Cleveland v. Ameriquest Mortg. Sec., Inc., 621 F.Supp.2d 513 (N.D. Ohio 2009), aff'd, 615 F.3d 496 (6th Cir. 2010); Kramer, 882 N.E.2d at 52.

         Absolute nuisance claims may be premised either on conduct that is: (i) intentional or unlawful, or (ii) based on maintaining an abnormally dangerous condition, with the first “requiring more evidence of intent (akin to an intentional tort), the other requiring less (akin to a strict liability tort).” City of Cincinnati v. Deutsche Bank Nat'l Tr. Co., 863 F.3d 474, 477-78 (6th Cir. 2017); Kramer, 882 N.E.2d at 52.

         A qualified nuisance, in contrast, is based on negligent conduct and requires proof of a breached duty of care, for which damages are recoverable. City of Cleveland, 621 F.Supp.2d at 521. Plaintiffs do not assert a claim for qualified public nuisance - they only assert a claim for absolute public nuisance. Caselaw addressing nuisance claims may refer to “tort” or “nuisance” generally, but the applicability of a given case depends on the specific category of nuisance alleged. Because Plaintiffs asset only a common-law claim for absolute public nuisance, only cases discussing that species of nuisance are apposite.

         Arguing that a four-year statute of limitations applies to common law nuisance claims, Defendants incorrectly rely on caselaw pertaining to qualified nuisance claims brought by private parties seeking damages for negligent conduct. (Doc. #: 1896-1, at 9 & n.20, 42-43; Doc. #: 2537 at 26 & n.30; Doc. #: 1874 at 2). These cases are: Brown v. County Comm'rs, 622 N.E.2d 1153 (Ohio Ct. App. 1993) (explaining that, where such a nuisance is continuing in nature, “a nuisance action can be brought for damages for those injuries incurred within the applicable four-year period, regardless of when the nuisance began”); Haas v. Sunset Ramblers Motor Cycle Club, Inc., 726 N.E.2d 613 (Ohio Ct. App. 1999) (concerning private nuisance claims seeking injunction and damages); Stewart v. Allen, 2008 WL 918528, at *3 (Ohio Ct. App. Apr. 7, 2008) (affirming dismissal of a private party's nuisance claim for damages); and Ashtabula River Corp. Grp. II v. Conrail, Inc., 549 F.Supp.2d 981, 987-988 (N.D. Ohio 2008) (concluding a common law public nuisance claim was based on damages due to negligence, and ruling the plaintiff lacked standing to pursue a statutory nuisance claim that did not seek equitable relief or sue in the name of the state).

         Unlike the plaintiffs in the above-cited cases, Plaintiff Counties plead absolute (not qualified) public nuisance based on intentional conduct, and seek equitable relief only. (Doc. #: 2212-1 at 1 & n.2). As such, longstanding precedent makes clear there is no limitations period applicable to these claims.[3] “A well-settled rule in Ohio is that no length of time can legalize a public nuisance and that therefore the statute of limitations does not run against an action to abate such a nuisance.” 72 Ohio Jur. 3d Nuisances § 22; see Lake Shore & M.S.R. Co. v. Hendricks, 40 N.E. 408 (Ohio 1895); Lawrence R. Co. v. Commissioners of Mahoning County, 1878 WL 75 (Ohio 1878); Little Miami R. Co. v. Commissioners of Greene County, 1877 WL 31 (Ohio 1877); Cleveland & P. Ry. Co. v. City of Cleveland, 1910 WL 688 (Ohio Cir. Ct. 1910), aff'd, 102 N.E. 1122 (Ohio 1912).

         Defendants attack Plaintiffs' argument, seeking to distinguish the cases upon which Plaintiffs rely by noting they date back a century or more and arise in the context of encroachments on public highways or public property. (Doc. #: 1896-1 at 42-43; Doc. #: 2537 at 26 & nn.30-31). But Defendants cite no authority overruling this precedent. Neither do they offer any authority supporting the proposition that equitable public nuisance actions, like those brought by Plaintiffs, are subject to a four-year, or any other, limitations period. The decisions on which Plaintiffs rely stand for the broad proposition that a governmental entity may maintain a suit to abate a public nuisance that interferes with a public right no matter how long the public nuisance has continued.[4]Although public nuisance law is frequently applied to claims concerning property rights, Ohio law does not limit public nuisance law to that context. See Cincinnati v. Beretta U.S.A. Corp., 768 N.E.2d 1136, 1142 (Ohio 2002) (stating “there need not be injury to real property in order for there to be a public nuisance” and concluding that, “under the Restatement's broad definition, a public-nuisance action can be maintained for injuries caused by a product if the facts establish that the design, manufacturing, marketing, or sale of the product unreasonably interferes with a right common to the general public.”).[5] Accordingly, the Court finds there is no period of limitations applicable to Plaintiffs' claims of common law absolute public nuisance.

         B. Ohio statutory nuisance.

         The parties do not analyze the statute of limitations applicable to Plaintiffs' statutory public nuisance claims. Nevertheless, the Court will undertake the analysis. Plaintiffs' claim arises under two sections of Ohio Rev. Code (“O.R.C.”), neither of which specifies a limitation period.

         The first statutory provision upon which Plaintiffs rely, § 3767.03 (Abatement of a Nuisance) states: “Whenever a nuisance exists, ” the persons authorized thereunder “may bring an action in equity . . . to abate the nuisance and to perpetually enjoin the person maintaining the nuisance from further maintaining it.” “Whenever” means “at any or every time that.” Merriam-Webster Dictionary (11th ed. 2003).[6]

         The second statutory provision, O.R.C. § 4729.35 (Violations Deemed Public Nuisance), declares that a person who violates any law “controlling the distribution of a drug of abuse” has acted in a way that is “inimical, harmful, and adverse to the public welfare of the citizens of Ohio, ” and this “constitute[s] a public nuisance.” The statute authorizes the State Attorney General or Ohio counties (by their county prosecutors) to maintain an action to enjoin any person violating those rules, and does not limit the time to do so. Id. Because absolute public nuisance claims and claims under O.R.C. § 3767.03 are not subject to limitations periods, the Court construes O.R.C. § 4729.35 as similarly free of any governing statute of limitations.

         C. Ohio Corrupt Practices Act.

         Defendants assert that claims under the Ohio Corrupt Practices Act (“OCPA”) are governed by a five-year limitations period, beginning when the cause of action first accrues, pursuant to O.R.C. § 2923.34(J). (Doc. #: 1896-1 at 5). But the same statute also provides two exceptions. First, an OCPA claim also “may be commenced at any time within five years after the unlawful conduct terminates.” Id. And second, if the State itself brings an OCPA lawsuit, then the limitations period for a separate civil action based on the same matters is “suspended” pending the State's action, and for two years following its termination. Id.; see also Iron Workers Local Union No. 17 Ins. Fund v. Philip Morris Inc., 29 F.Supp.2d 801, 809 (N.D. Ohio 1998) (OCPA “allows an action within five years of the latest of three dates.”).

         Defendants insist a simple five-year limitations period applies, but this is incorrect.[7] The first exception applies in this case, as Defendants do not even assert the complained-of conduct ceased more than five years prior to the filing dates of the Counties' Complaints. The second exception also applies, as Plaintiffs' limitations period is suspended for two years following termination of the similar pending action filed by the State of Ohio, State of Ohio ex rel. Yost v. Purdue Pharma L.P. et al., Case No. CV-17 CI 000261 (Ross County Ct. C.P.). In this case, the Ohio Attorney General alleges, as do Plaintiff Counties here, that certain Defendants operated an opioid marketing enterprise in violation of the OCPA. (Doc. #: 2212-1 at 22 and referenced exhibits).[8] Accordingly, Defendants are not entitled to summary judgment on Plaintiffs' OCPA claim on limitations grounds.

         D. Federal RICO.

         “RICO provides for civil actions . . . by which ‘[a]ny person injured in his business or property” by a RICO violation may seek treble damages and attorney's fees.' 18 U.S.C. § 1964(c).” Rotella v. Wood, 528 U.S. 549, 552 (2000). A four-year statute of limitations governs RICO civil claims for damages. Agency Holding Corp. v. Malley-Duff & Associates, Inc., 483 U.S. 143, 156, (1987). Specifically, noting the absence of any limitations provision in the RICO Act itself, Agency Holding established the four-year statute for RICO civil claims for damages by “borrowing” the four-year period governing damages claims under the Clayton Act. See Agency Holding, 483 U.S. at 146-155.

         Plaintiffs do not dispute that their RICO damages claims are subject to the four-year statute of limitations. Rather, they argue their claims for equitable relief under RICO are not subject to any statute of limitations, because the Clayton Act's equitable relief provision exempts such claims from any limitations. See Areeda and Hovenkamp, Antitrust Law, at ¶ 320 (4th ed. 2014) (“The §4B [of the Clayton Act] limitation period applies only to damage actions. Equity actions, private or governmental, are not restricted by the statute of limitation.”). (Doc. #: 2212-1 at 23).

         To refute Plaintiffs' position, Defendants cite dicta from a Sixth Circuit decision finding persuasive the proposition that RICO does not provide private litigants an equitable remedy in the first place, so the Court must simply apply the four-year limitations period applicable to Plaintiffs' claims for damages; no further analysis is needed.[10] See Ganey v. Raffone, 91 F.3d 143, 1996 WL 382278, at *4 n.6 (6th Cir. 1996) (discussing Religious Tech. Ctr. v. Wollersheim, 796 F.2d 1076 (9th Cir. 1986)) (“[Wollersheim] held ‘that injunctive relief is not available to a private plaintiff in a civil RICO action.' * * * Although we find the Wollersheim analysis persuasive, because this matter can be disposed of by other means, we do not rule on whether injunctive relief is available” under RICO).[11] (Doc. #: 2537 at 27-28).

         The Court concludes Defendants' argument that equitable relief is unavailable under RICO is not well-taken. Neither the Supreme Court nor the Sixth Circuit has squarely addressed whether RICO provides an equitable remedy to private plaintiffs, and there is a Circuit split on the question. See, e.g., Jackson v. Rohm & Haas Co., 2009 WL 948741, at *2 (E.D. Pa. Mar. 20, 2009) (collecting cases with differing conclusions), aff'd, 366 Fed.Appx. 342 (3rd Cir. 2010). Unlike the very brief dicta in Ganey, more recent Circuit cases undertaking deeper analysis conclude RICO does provide equitable relief. See Chevron Corp. v. Donziger, 833 F.3d 74, 137 (2nd Cir. 2016) (joining the Seventh Circuit in concluding that federal courts are authorized to grant equitable relief to a private plaintiff establishing injury under Section 1962); National Organization for Women, Inc. v. Scheidler, 267 F.3d 687, 695 (7th Cir. 2001), reversed on other grounds, 537 U.S. 393 (2003). The question of what limitations period applies to a RICO claim for equitable relief, therefore, is not moot.

         The Agency Holding court held that the Clayton Act is more closely analogous to RICO than any state law, therefore its four-year statute of limitations governing claims by private parties seeking damages is most appropriate for RICO actions. See 483 U.S. at 146-155. Defendants rely on Agency Holding's reasoning that, where federal statutes do not provide express statutes of limitations, “we do not ordinarily assume that Congress intended that there be no limit on actions at all; rather, our task is to ‘borrow' the most suitable statute or other rule of timeliness from some other source.” Id. at 146 (internal quotation marks and citations omitted).

         Agency Holding, however, did not address whether equitable claims could be brought under RICO in the first place or, if so, whether the Clayton Act's express exemption of injunctive claims from a limitations period would govern such claims. Defendants note the Agency Holding decision said nothing about borrowing the Clayton Act's rule exempting equitable claims from limitations periods. Defendants reason, “had Congress wanted to provide such an exemption, it would have said so.” (Doc. #: 2526 at 28). This argument ignores that, had Congress wanted to include any statute of limitations in RICO, it could have done so, thereby obviating the need for the borrowing exercise undertaken by the Agency Holding court.

         Defendants also contend that, because Plaintiffs' RICO claims seek both damages and equitable relief based on the same facts, the claims are governed by a general rule that the statute of limitations should apply to both types of remedy. See Nemkov v. O'Hare Chicago Corp.,592 F.2d 351, 355 (7th Cir. 1979); Cope v. Anderson,331 U.S. 461, 464 (1947). (Doc. #: 2637 at 28-29). But Defendants cite no caselaw applying that general rule to a RICO case. Further, the cases Defendants cite predate Agency Holdings and apply state law statutes of limitations to federal statutory claims that lack their own ‒ ...

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