$35 Million Settlement Reached in Sullivan Baby Doe Opioid Suit

In July 2021, following more than four years of litigation, a $35 million settlement was reached in the Sullivan Baby Doe suit (originally Staubus, et al. v. Purdue Pharma, L.P., et al.). J. Gerard Stranch IV, founding and managing member of Stranch, Jennings & Garvey (formerly Branstetter, Stranch & Jennings), served as the lead trial attorney in the case. 

The suit targeted U.S. opioid producers Endo Health Solutions Inc. and Endo Pharmaceuticals Inc. It was one of the first to challenge major opioid producers, and the very first to include a baby born with neonatal Abstinence Syndrome (NAS) as a plaintiff.

The agreement was the largest per capita settlement that any prosecution had reached with Endo at that time, exceeding a $10 million settlement paid to two Ohio counties in 2019, and $8.8 million paid to the state of Oklahoma in 2020, areas with far higher population levels than the participating counties of northeast Tennessee.

Funds were divided among participating cities and counties based on population levels, with many municipalities choosing to direct resources toward addiction prevention and treatment. Funds were also dedicated to the well-being and care of Baby Doe, who was represented by a guardian ad litem (GAL).

The Sullivan Baby Doe suit was originally filed on June 13, 2017, by the district attorneys general of Tennessee’s First, Second and Third Judicial Districts in Sullivan County Circuit Court. The complaint originally listed prescription opioid manufacturer Purdue Pharma, L.P. and its related companies, along with Mallinckrodt PLC, Endo Pharmaceuticals, a pill mill doctor and other convicted opioid dealers as defendants. 

The suit claimed that under Tennessee’s Drug Dealer Liability Act (DDLA), if a company engages in activities that facilitate over-prescription and diversion of controlled substances, they can be identified as a drug dealer and held accountable for their actions. 

A December 2020 opinion filed by the Tennessee State Supreme Court affirmed the validity of that argument and the ability for plaintiffs to sue on behalf of babies harmed in utero by the opioid epidemic.

As part of the national scrutiny brought to bear on opioid producers and distributors, due in part to Sullivan Baby Doe’s arguments, Purdue and Mallinckrodt both declared bankruptcy. Endo remained the only active corporate defendant.

In April 2021, in the Sullivan County Circuit Court in Kingsport, Tennessee, Chancellor E.G. Moody granted a default judgment against Endo Health Solutions, Inc. and Endo Pharmaceuticals, Inc. in the Sullivan Baby Doe suit. The plaintiffs, who were represented by Stranch, included governmental entities and an infant born drug-dependent, listed as Baby Doe, by and through a GAL. 

The judgment specifically called out Endo and its counsel for employing “a coordinated strategy” to delay legal proceedings, withhold information related to the sale and marketing of its opioid medication Opana ER — including nearly 400,000 documents produced by the defendants after the discovery period closed, and “interfere with the administration of justice” in a civil trial — including at least a dozen false statements made to the court by Endo’s attorneys. The judgment also found that “Endo and its attorneys, after delaying trial, have resorted to trying to improperly corrupt the record.”

“Although this is a harsh sanction, justice demands it under the circumstances,” Chancellor Moody wrote. “Anything less would make a mockery of the attorneys who play by the rules and the legal system.”