Category: Daily News

The New York Attorney General announced an agreement with Johnson & Johnson – the parent company of Janssen Pharmaceuticals, Inc. – that will deliver up to $230 million to New York state.

In March 2019, the New York Attorney General filed the nation’s most extensive lawsuit to hold accountable the various manufacturers and distributors responsible for the opioid epidemic. In addition to J&J, the manufacturers named in the complaint included Purdue Pharma and its affiliates, as well as members of the Sackler Family (owners of Purdue) and trusts they control; Mallinckrodt LLC and its affiliates; Endo Health Solutions and its affiliates; Teva Pharmaceuticals USA, Inc. and its affiliates; and Allergan Finance, LLC and its affiliates.

The distributors named in the complaint were McKesson Corporation, Cardinal Health Inc., Amerisource Bergen Drug Corporation, and Rochester Drug Cooperative Inc.

The agreement resolves claims made by for the company’s role in helping to fuel the opioid epidemic and would allocate payments over nine years, with substantial payments made upfront.

The agreement also makes enforceable a bar stopping J&J and all of its subsidiaries, predecessors, and successors from manufacturing or selling opioids anywhere in New York, and acknowledges Johnson & Johnson’s exit from the opioid business nationally.

The cases against Purdue Pharma (and subsequently the Sackler family), Mallinckrodt, and Rochester Drug Cooperative are all now moving separately through U.S. Bankruptcy Court. The trial against all other defendants is currently slated to begin this coming week.

The Attorney General negotiated substantial injunctive relief securing the end of J&J’s manufacturing of opioids and their distribution across New York and the rest of the nation.  

The company will also provide the Office of the Attorney General with details of when the last of the inventory of opioids it has already shipped expires.

Additionally, J&J will be prohibited from promoting opioids or opioid products through sales representatives, sponsorships, financial support, or any other means; will not be allowed to provide financial incentives to its sales and marketing employees for the sale of these products; and will not, directly or indirectly, provide financial support or in-kind support to any third party that primarily engages in conduct that promotes opioids, opioid products, or products for the treatment of opioid-induced side effects.

J&J will additionally be forbidden from disciplining its sales and marketing employees for not hitting opioids sales quotas – one of the key motivators J&J and other companies had in marketing opioids so heavily to the American public – and will not be allowed to use, assist, or employ any third party to engage in any activity that J&J itself would be prohibited from engaging in pursuant to today’s agreement.

J&J will also be prohibited from lobbying federal, state, or local legislative or regulatory authorities about opioids or opioid products.

Finally, J&J will have to make additional information about opioids and opioid products more accessible to the public, including to patients, health care providers, and others. Part of how J&J will fulfill this provision is by sharing clinical trial data under the Yale University Open Data Access (YODA) Project to allow researchers qualified under the program to access the company’s propriety data under the terms of the project.

In early 2020, COVID-19 seemed like a potentially significant and disruptive event for the workers compensation industry. NCCI responded by authoring its white paper, COVID-19 and Workers Compensation: Modeling Potential Impacts (PDF) and creating the COVID-19 Hypothetical Scenarios Tool to help the industry evaluate potential direct cost impacts the pandemic may have on WC losses.

Leveraging the COVID-19 claims data that has been reported to NCCI so far, can bring the ultimate impact that the pandemic may have on WC costs more into focus.

Key Takeaways:

– – NCCI has observed $260 million of case-incurred COVID-19 WC losses, excluding self-insureds, for Accident Year 2020 in jurisdictions where NCCI provides ratemaking services.
– – NCCI estimates that COVID-19 claims, excluding self-insureds, have the potential to ultimately result in WC losses exceeding $500 million over the entire duration of the pandemic across jurisdictions where NCCI provides ratemaking services. (NCCI provides ratemaking services in 38 jurisdictions.)

As of year-end 2020, private carriers and state funds reported 45,000 pandemic-related claims to NCCI associated with $260 million in case-incurred losses – an average COVID-19 cost per claim of approximately $6,000. Note: This claim count total reflects those claims with a reported payment or reserve (i.e., a loss or expense reserve).

Most of the reported COVID-19 claims to date have associated costs less than $1,500 and almost 95% have costs less than $10,000.

Further, while larger claims – those with losses greater than $100,000 – represent about 1% of all COVID-19 claims, they account for approximately 60% of reported COVID-19 losses to date. Claims in this category are generally more likely to remain open for extended periods of time, involve older workers, require inpatient hospitalization, and involve more complications due to the existence of comorbidities.

To date, nursing/convalescent home employees, other healthcare workers, and first responders have collectively accounted for more than 75% of all COVID-19 claims reported to NCCI. Other workers in the restaurant, building operations, distribution systems, and retail industries have collectively accounted for an additional 14% of reported COVID-19 claims.

Historically, medical-only claims (i.e., claims without an indemnity, lost-wage component) have accounted for almost 75% of all WC claims. Interestingly, this claim-type distribution reversed when we examined reported COVID-19 claims.

Of all the reported pandemic-related claims with a payment or loss reserve, almost 75% have an indemnity component, while only 25% are medical-only.

The Los Angeles Times reports that the city of San Francisco’s 35,000 employees will need to get vaccinated against COVID-19 or risk losing their jobs.

The new policy would make San Francisco the first major city and county in California to require COVID-19 vaccinations for its employees. Workers who refuse, or fail to provide a religious or medical exemption, could be terminated.

The mandatory vaccination requirement, which goes into effect once the vaccines have been formally approved by the Food and Drug Administration, extends to all city government employees, including police, firefighters, custodians and City Hall clerks. Teachers are not covered by this policy because they are school district employees. Earlier, San Francisco mandated that front-line workers in hospitals, nursing homes and jails be fully vaccinated against COVID-19.

Carol Isen, San Francisco’s director of human resources, said that employees will have until July 29 to report their current vaccination status to the city as a condition of their employment. Staff will need to upload their vaccination cards or documentation showing proof of vaccination through the city’s payroll system. Medical exemptions for employees who are ineligible for a COVID-19 vaccination must be verified by a healthcare provider. Religious exemptions will also be considered.

San Francisco enacted some of the nation’s strictest pandemic regulations and has the highest vaccination rate in the state, with at least 71% of eligible residents fully vaccinated, according to the city’s Department of Public Health. As of Wednesday, 55% of city employees have reported receiving at least one dose of a COVID-19 vaccine, according to the Department of Human Resources.

Not everyone is on board with the new policy. Theresa Rutherford, regional vice president of the Service Employees International Union Local 1021 chapter, said it threatens the livelihoods of front-line essential workers. The chapter represents more than half of all workers employed by the city and county of San Francisco.

At this point, Los Angeles County isn’t planning to follow in San Francisco’s footsteps, according to Public Health Director Barbara Ferrer. “We’d obviously be working very closely with our labor partners, with the Board of Supervisors and the CEO’s office on making a decision of that magnitude,” she said during a briefing Thursday. “You know, there’s about 110,000 county employees, so we would want to really have a healthy discussion with our employees and particularly with our labor partners about what’s the most sensible path forward.”

The University of California and California State University systems have announced they will be requiring all students, faculty and staff on their campuses to be vaccinated.

The U.S. Supreme Court said California was violating the Constitution with a decades-old regulation that gives union organizers access to agricultural company land for part of the year to talk to workers.

Voting 6-3 along ideological lines, the justices said the 1975 provision, which grew out of the efforts of Cesar Chavez to give farm workers collective bargaining rights, infringed the rights of landowners.

The California regulation grants labor organizations a “right to take access” to an agricultural employer’s property in order to solicit support for unionization. Cal. Code Regs., tit. 8, §20900(e)(1)(C). The regulation mandates that agricultural employers allow union organizers onto their property for up to three hours per day, 120 days per year.

Organizers from the United Farm Workers sought to take access to property owned by two California growers “Cedar Point Nursery and Fowler Packing Company.

The growers filed suit in Federal District Court seeking to enjoin enforcement of the access regulation on the grounds that it appropriated without compensation an easement for union organizers to enter their property and therefore constituted an unconstitutional per se physical taking under the Fifth and Fourteenth Amendments.

The District Court denied the growers’ motion for a preliminary injunction and dismissed the complaint, holding that the access regulation did not constitute a per se physical taking because it did not allow the public to access the growers’ property in a permanent and continuous manner.

A divided panel of the Court of Appeals for the Ninth Circuit affirmed, and rehearing en banc was denied over dissent.

The U.S. Supreme Court reversed and ruled in favor of the landowners in the case of Cedar Point Nursery v Hassid.

The Takings Clause of the Fifth Amendment, applicable to the States through the Fourteenth Amendment, provides: “[N]or shall private property be taken for public use, without just compensation.”

When the government physically acquires private property for a public use, the Takings Clause obligates the government to provide the owner with just compensation.

California’s access regulation appropriates a right to invade the growers’ property and therefore constitutes a per se physical taking. Rather than restraining the growers’ use of their own property, the regulation appropriates for the enjoyment of third parties (here union organizers) the owners’ right to exclude. The right to exclude is “a fundamental element of the property right.”

Robert Joseph Maher, 42, formerly of Stockton, was sentenced by U.S. District Judge John A. Mendez to six years and three months in prison for mail fraud and aggravated identity theft.

According to court documents, between November 2010 and February 2018, Maher participated in a scheme to defraud the State of California Employment Development Department (EDD) by filing fraudulent claims for unemployment insurance benefits.

In furtherance of this scheme, Maher and his co-defendant, Michael Herron II, also of Stockton, created fictitious companies and fictitious employees by using the real identities of persons with and without their knowledge. They then filed claims with EDD, falsely stating that the employees had been laid-off or fired. The unemployment benefits were deposited onto debit cards that were mailed to addresses controlled by Maher, Herron, or their associates.

In one instance, Maher and Herron electronically filed an unemployment insurance claim in the name of an identity-theft victim. Maher knew that the victim was a real person because the claim listed the victim’s correct date of birth and social security number. The claim also listed Maher’s address in Stockton as the claimant’s address, which caused a bank to mail an EDD debit card in the victim’s name to Maher’s address.

Maher and Herron then transferred the card’s benefits to Maher’s personal bank account. Maher and Herron also used the victim’s name to register another fictitious business entity that was used in the fraud scheme.

In all, Maher and Herron filed at least 72 fraudulent claims for unemployment insurance benefits, seeking a total of $739,535, of which EDD paid out approximately $609,335. Judge Mendez ordered Maher to pay restitution to EDD in the amount of $609,335.

This case is the product of an investigation by the U.S. Department of Labor – Office of Inspector General, the Federal Bureau of Investigation, and the California Employment Development Department’s Investigation Division. Special Assistant U.S. Attorney Robert J. Artuz is prosecuting the case.

On March 26, 2019, Herron pleaded guilty to similar counts of mail fraud and aggravated identity theft and, on June 25, 2019, was sentenced to six years and three months in prison.