O. “Promote,” “Promoting,” and “Promotion” shall mean dissemination of information or other practices intended or that could be reasonably anticipated to (i) increase sales, prescriptions, or the utilization of prescription products in the United States, or (ii) that attempt to influence prescribing practices or formulary decisions in the United States.
These terms shall not include the provision of scientific information or data in response to unsolicited requests from Health Care Providers or payors as allowed in Section II. A. 2. (e)-(h).
P. “Qualified Researcher” shall mean any researcher holding a faculty appointment or research position at an institution of higher education, a research organization, a nonprofit organization, or a government agency.
Q. “Suspicious Order” shall have the same meaning as provided by the Controlled Substances Act, 21 U.S.C. §§ 801-904, and the regulations promulgated thereunder and analogous state laws and regulations.
R. “Teva” shall mean Teva Pharmaceutical Industries Ltd., Teva Pharmaceuticals USA, Inc., Cephalon, Inc., Watson Laboratories, Inc., Actavis LLC, and Actavis Pharma, Inc., f/k/a P-3
Watson Pharma Inc., and each of their parents, subsidiaries, predecessors, successors, affiliates, divisions, assigns, officers, directors, agents, employees and principals, but shall exclude Teva’s wholly owned distributor subsidiary, Anda, Inc. For the avoidance of doubt, Teva does not include entities or individuals controlled by or employed by separate and distinct legal entities that are not directly or indirectly owned by Teva.
S. “Teva Opioid Products” shall mean Vantrela ER and Opioid Products listed on Teva’s product catalog as of the Effective Date or that are added thereafter.
T. “Third Party” shall mean any person or entity other than Teva or a government entity.
U. “Treatment of Pain” shall mean the provision of therapeutic modalities to alleviate or reduce pain.
V. “Unbranded Information” shall mean any information that does not identify a specific product(s).
II. INJUNCTIVE RELIEF
A. Ban on Promotion
1. Teva shall not engage in the Promotion of Opioids or Opioid Products including, but not limited to, by:
a. Employing or contracting with sales representatives or other persons to Promote Opioids or Opioid Products to Health Care Providers or patients, or to persons that influence or determine the Opioid Products included in formularies;
b. Using speakers, key opinion leaders, thought leaders, lecturers, and/or speaking events for Promotion of Opioids or Opioid Products;
c. Sponsoring, or otherwise providing financial support or In-Kind Support to medical education programs relating to Opioids or Opioid Products;
d. Creating, sponsoring, operating, controlling, or otherwise providing financial support or In-Kind Support to any website, network, and/or social or other media account for the Promotion of Opioids or Opioid Products;
e. Creating, sponsoring, distributing, or otherwise providing financial support or In-Kind Support for materials Promoting Opioids or Opioid Products, including, but not limited to, P-4
brochures, newsletters, pamphlets, journals, books, and guides that Promote Opioids or Opioid Products;
f. Creating, sponsoring, or otherwise providing financial support or In-Kind Support for advertisements that Promote Opioids or Opioid Products, including, but not limited to, internet advertisements or similar content that Promote Opioids or Opioid Products, and providing hyperlinks or otherwise directing internet traffic to advertisements that Promote Opioids or Opioid Products; and
g. Engaging in Internet search engine optimization or other techniques designed to Promote Opioids or Opioid Products by improving rankings or making content appear among the top results in an Internet search or otherwise be more visible or more accessible to the public on the Internet.
2. Notwithstanding Section II.A.1 directly above, Teva may:
a. Maintain corporate websites;
b. Maintain a website for any Opioid Product that contains principally the following content: the FDA-approved package insert, medication guide, and labeling, and a statement directing patients or caregivers to speak with a licensed Health Care Provider;
c. Provide information or support the provision of information as expressly required by law or any state or federal government agency with jurisdiction in the State where the information is provided. Teva may, in relation to its expressly required participation in the TIRF REMS program, remain involved in the preparation of materials and training concerning the process for enrollment in the TIRF REMS program; d. Provide the following by mail, electronic mail, on or through Teva’s corporate or product websites or through other electronic or digital methods:
FDA-approved package insert, medication guide, approved labeling for Opioid Products or other prescribing information for Opioid Products that are published by a state or federal government agency with jurisdiction in the State where the information is provided;
e. Provide scientific and/or medical information in response to an unsolicited request by a Health Care Provider consistent with the standards set forth in the FDA’s Draft Guidance for Industry, Responding to Unsolicited Requests for Off-Label Information About Prescription Drugs and Medical Devices (Dec. 2011, as updated or amended by the FDA) and Guidance for Industry, Good Reprint Practices for the Distribution of Medical Journal Articles and P-5
Medical or Scientific Reference Publications on Unapproved New Uses of Approved Drugs and Approved or Cleared Medical Devices (Jan. 2009, as updated or amended by the FDA). However, Teva shall not provide the following publication in response to an unsolicited request by a Health Care Provider: Weinstein, SM, et al., Fentanyl buccal tablet for the treatment of breakthrough pain in opioid-tolerant patients with chronic cancer pain: a long-term, open-label safety study. Cancer; 2009;115:2571-2579. f. Provide a response to any unsolicited question or request from a patient or caregiver, directing the patient or caregiver to the FDA-approved labeling or to speak with a licensed Health Care Provider without describing the safety or effectiveness of Opioids or any Opioid Product (beyond directing the patient or caregiver to the label) or naming any specific provider or healthcare institution; or directing the patient or caregiver to speak with their insurance carrier regarding coverage of an Opioid Product; g. Provide Health Care Economic Information, as defined at 21 U.S.C. § 352(a), to a payor, formulary committee, or other similar entity with knowledge and expertise in the area of health care economic analysis consistent with standards set forth in the FDA’s Draft Questions and Answers Guidance for Industry and Review Staff, Drug and Device Manufacturer Communications With Payors, Formulary Committees, and Similar Entities (Jan. 2018), as updated or amended by the FDA; h. Provide information relating solely to the pricing and availability of any Opioid Product and negotiate contract and pricing terms with direct customers or Downstream Customers;
i. Sponsor or provide financial support or In-Kind Support for an accredited or approved continuing medical education program required by either an FDA-approved Risk Evaluation and Mitigation Strategy (REMS) program or other federal or state law or regulation applicable in the State where the information is provided through an independent Third Party, which shall be
responsible for the continuing medical education program’s content without the participation of Teva; and
j. Provide Unbranded Information in connection with managing pain in End-of-Life Care and/or Cancer-Related Pain Care relating to: the use of Opioids for managing such pain, as long as the Unbranded Information identifies Teva as the source of the information.
3. Teva shall not engage in the following specific Promotional activity relating to any Opioid-Induced Side Effects Treatment Product.
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a. Employing or contracting with sales representatives or other persons to Promote Opioid-Induced Side Effects Treatment Products to Health Care Providers or patients;
b. Using speakers, key opinion leaders, thought leaders, lecturers, and/or speaking events for Promotion of Opioid-Induced Side Effects Treatment Products;
c. Sponsoring, or otherwise providing financial support or In-Kind Support to medical education programs relating to Opioid-Induced Side Effects Treatment Products;
d. Creating, sponsoring, or otherwise providing financial support or InKind Support for advertisements that Promote Opioid-Induced Side Effects Treatment Products, including, but not limited to, internet advertisements or similar content that Promote Opioid-Induced Side Effects Treatment Products, and providing hyperlinks or otherwise directing internet traffic to advertisements that Promote Opioid-Induced Side Effects Treatment Products; and
e. Engaging in any other Promotion of Opioid-Induced Side Effects Treatment Products in a manner that encourages the utilization of Opioids or Opioid Products or normalizes the use of Opioids or Opioid Products for chronic pain.
4. Notwithstanding Section II.A.3 directly above, Teva may engage in Promotional activity for Opioid-Induced Side Effects Treatment Products that have nonOpioid related indications, so long as such Promotion does not explicitly or implicitly associate such Opioid-Induced Side Effects Treatment Product with Opioids or Opioid Products, except for linking to the FDA label associated with such Opioid-Induced Side Effects Treatment Product.
5. Treatment of Pain.
a. Teva shall not, either through Teva or through Third Parties, Promote the Treatment of Pain in a manner that directly or indirectly encourages the utilization of Opioids or Opioid Products.
b. Teva shall not, either through Teva or through Third Parties, Promote the concept that pain is undertreated in a manner that directly or indirectly encourages the utilization of Opioids or Opioid Products. c. Teva shall not disseminate Unbranded Information, including Unbranded Information about a medical condition or disease state that contains links to branded information about Opioid Products or that generates data that Teva uses for Promotion of Opioids or Opioid Products.
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6. To the extent that Teva engages in conduct permitted by Sections II.A.2 and A.4 above, Teva shall do so in a manner that is:
a. Consistent with the CDC Guideline Recommendations, as applicable; and
b. Truthful, non-misleading, accurate, non-deceptive, and does not omit any relevant information.
B. No Financial Reward or Discipline Based on Volume of Opioid Sales
1. Teva shall not provide financial incentives to its sales and marketing employees or discipline its sales and marketing employees based upon sales volume or sales quotas for Opioid Products. However, this provision shall not prohibit financial incentives based on overall company performance.
2. Teva shall not offer or pay any remuneration (including any kickback, bribe, or rebate) not subject to the Discount/Rebate Safe Harbor directly or indirectly, to or from any person in return for the prescribing, sale, use or distribution of Opioid Product.
3. Teva’s compensation policies and procedures shall be designed to ensure compliance with this Agreement and other legal requirements.
C. Ban on Funding/Grants to Third Parties.
1. Teva shall not directly or indirectly provide financial support or In-Kind Support to any Third Party that Promotes or is for education about Opioids, Opioid Products, the Treatment of Pain, or Opioid-Induced Side Effects Treatment Products, excluding financial support otherwise required by the Judgment or by a federal or state agency.
2. Teva shall not create, sponsor, provide financial support or In-Kind Support to, operate, or control any medical society or patient advocacy group relating to any Opioids, Opioid Products, Treatment of Pain, or Opioid-Induced Side Effects Treatment Product.
3. Teva shall not provide a direct link to any Third Party website or materials or otherwise distribute materials created by a Third Party relating to any Opioids, Opioid Products, the Treatment of Pain, or Opioid-Induced Side Effects Treatment Products.
4. The above prohibitions do not prevent Teva from engaging with Third Parties in connection with and consistent with the activities Teva is permitted to undertake pursuant to Sections II.A.2 and II.A.4.
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5. Teva shall not use, assist, or employ any Third Party to engage in any activity that Teva itself would be prohibited from engaging in pursuant to this Agreement.
6. Teva shall not enter into any contract or agreement with any person or entity or otherwise attempt to influence any person or entity in such a manner that has the purpose or foreseeable effect of limiting the dissemination of information regarding the risks and side effects of using Opioids.
7. Teva shall not compensate or support Health Care Providers or organizations to advocate for formulary access or treatment guideline changes that would have the effect of increasing access to any Opioid Product by third-party payers, i.e., any entity, other than an individual, that pays or reimburses for the dispensing of prescription medicines, including, but not limited to, managed care organizations and pharmacy benefit managers.
8. No Board of Directors member, Executive Officer, or senior management-level employee of a United States Teva entity may serve as a director, board member, employee, agent, or officer of any entity that engages in Promotion relating to Opioids, Opioid Products, the Treatment of Pain, or Opioid-Induced Side Effects Treatment Products. For the avoidance of doubt, nothing in this provision shall preclude an officer or executive management-level employee of Teva from concurrently serving on the board of a hospital.
9. Teva shall play no role in appointing persons to the board, or hiring persons to the staff, of any entity that engages in Promotion relating to any Opioids, Opioid Products, the Treatment of Pain, or Opioid-Induced Side Effects Treatment Products.
10. For the avoidance of doubt:
a. Nothing in this Section II.C shall be construed or used to prohibit Teva from providing financial or In-Kind Support to:
i. universities, medical institutions, or hospitals, for the purpose of addressing, or providing education on (I) the treatment of OUD; (II) the prevention and treatment of opioid abuse, addiction, or overdose, including medication-assisted treatment for opioid addiction; and/or (III) rescue medications for opioid overdose; ii. the American Medical Association (AMA), the American Cancer Society (ACS) or any other medical society solely dedicated to cancer treatment; or
iii. broad based trade associations including, without limitation, PhRMA (Pharmaceutical Research and Manufacturers of
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America), HDA (Healthcare Distribution Alliance), AAM
(Association for Accessible Medications), PCMA (Pharmaceutical Care Management Association), and NACDS (National
Association of Chain Drug Stores), or successor organizations to any of the foregoing.
11. Teva will be in compliance with Sections II.C.2 and II.C.3 with respect to support of an individual Third Party to the extent that the Independent Monitor determines that such support does not increase the risk of the inappropriate use of Opioids and that Teva has not acted for the purpose of increasing the use of Opioids.
12. The above prohibitions do not apply to the donation of product pursuant to any settlement agreements or resolutions to litigation and/or investigations.
13. Reference to any specific Third Party organization above shall in no way be construed as an approval or sanction by the States of such Third Party’s conduct or business practices.
D. Lobbying Restrictions.
1. Teva shall not Lobby for the enactment of any federal, state, or local legislation or promulgation of any rule or regulation that:
a. Encourages or requires Health Care Providers to prescribe Opioids or sanctions Health Care Providers for failing to prescribe Opioids or failing to treat pain with Opioids;
b. Would have the effect of limiting access to any non-Opioid alternative pain treatments; or
c. Pertains to the classification of any Opioid or Opioid Product as a scheduled drug under the Controlled Substances Act.
2. Teva shall not Lobby against the enactment of any provision within any federal, state, local legislation, rule, or regulation that supports:
a. The use of non-pharmacologic therapy and/or non-Opioid pharmacologic therapy to treat chronic pain over or instead of Opioid use, including but not limited to third party payment or reimbursement for such therapies;
b. The use and/or prescription of immediate release Opioids instead of extended release Opioids when Opioid use is initiated, including but not limited to third party reimbursement or payment for such prescriptions;
c. The prescribing of the lowest effective dose of an Opioid, including but not limited to third party reimbursement or payment for such prescription; P-10
d. The limitation of initial prescriptions of Opioids to treat acute pain; e. The prescribing and other means of distribution of naloxone to minimize the risk of overdose, including but not limited to third party reimbursement or payment for naloxone;
f. The use of urine testing before starting Opioid use and annual urine testing when Opioids are prescribed, including but not limited to third party reimbursement or payment for such testing;
g. Evidence-based treatment (such as using medication-assisted treatment with buprenorphine or methadone in combination with behavioral therapies) for OUD, including but not limited to third party reimbursement or payment for such treatment; or
h. The implementation or use of Opioid drug disposal systems.
3. Teva shall not Lobby against the enactment of any federal, state or local legislation or promulgation of any rule or regulation expanding the operation or use of PDMPs, including but not limited to provisions requiring Health Care Providers to review PDMPs when Opioid use is initiated and with every prescription thereafter.
4. Notwithstanding the foregoing restrictions in subparagraphs II.D.1-3, the following conduct is not restricted:
a. Challenging the enforcement of, or suing for declaratory or injunctive relief with respect to legislation, rules or regulations referred to in subparagraphs II.D.1;
b. Communications made by Teva in response to a statute, rule, regulation, or order requiring such communication;
c. Communications by a Teva representative appearing before a federal or state legislative or administrative body, committee, or subcommittee as result of a mandatory order or subpoena commanding that person to testify; or Responding, in a manner consistent with this Agreement, to an unsolicited request for the input on the passage of legislation or the promulgation of any rule or regulation when such request is submitted in writing specifically to Teva from a government entity directly involved in the passage of that legislation or promulgation of that rule or regulation;
d. Conduct permitted pursuant to Section II.C.10; or
e. Responding to requests from government agencies and/or participating in panels at the request of a government agency.
5. Teva shall require all of its officers and employees engaged in Lobbying to certify P-11
in writing to Teva that they are aware of and will fully comply with the provisions of this Exhibit P with respect to Lobbying.
E. Monitoring and Reporting of Off-Label Use of Transmucosal ImmediateRelease Fentanyl (TIRF) Products.
1. Teva shall monitor for off-label prescribing of its TIRF products in the United States, including analysis that utilizes prescription and patient diagnosis data, using the TIRF REMS program data accessible to Teva to determine:
a. the indication(s) or diagnoses for which the TIRF product was prescribed in the United States and whether those indications or diagnoses were on-label or offlabel; and b. use by opioid-intolerant patients in the United States.
2. Upon request of one of the following in a Settling State, Teva shall provide the requestor with the data and analysis described in Subsection II.E.1, to be used for law enforcement, counter-detailing, academic or medical research, or public health and other noncommercial purposes: State Attorney General or other law enforcement agency, State medical board, State board of pharmacy, Qualified Researchers, medical and pharmacy directors of health systems or clinics, medical associations, and other public health officials, including but not limited to city health authorities, county medical directors, and State public health authorities.
3. Teva shall provide the data and analysis described in Subsection II.E.1 in chart format, including breakdown of prescriptions by year, diagnosis, and county.
F. Ban on High Dose Opioids.
1. After any related commercial commitments existing on February 15, 2022 have expired, Teva shall not manufacture, promote, or distribute any oxycodone pill that exceeds 40 milligrams.
G. Ban on Prescription Savings Programs.
1. Teva shall not directly or indirectly offer any discounts, coupons, rebates, or other methods which have the effect of reducing or eliminating a patient’s co-payments or the cost of prescriptions (e.g., free trial prescriptions) for any Opioid Product. This does not preclude Teva from offering discounts, rebates, or other customary pricing adjustments to commercial partners for the non-retail sale of any Opioid Product, including providing discounts, coupons, rebates, or other methods for use by retail chain pharmacies, such as CVS, Walgreens, Rite Aid and the like, as well as contracting intermediaries, such as Buying Groups, Group Purchasing Organizations, and Pharmacy Benefit Managers.
2. Teva shall not directly or indirectly provide financial support to any Third Party that offers coupons, discounts, rebates or other methods which have the effect of reducing or P-12
eliminating a patient’s co-payments or the cost of prescriptions (e.g., free trial prescriptions) for any Opioid Product.
3. Teva shall not directly or indirectly assist patients, Health Care Providers, or pharmacies regarding the claims and/or prior authorization process required for third-party payers to approve claims involving any Opioid Product.
H. Monitoring and Reporting of Direct and Downstream Customers.
1. Teva shall operate an effective monitoring and reporting system in compliance with 21 C.F.R. § 1301.71(a), 21 C.F.R. §1301.74(b), 21 U.S.C. § 823(e) and Section 3292 of the SUPPORT for Patients and Communities Act, that shall include processes and procedures that:
a. Utilize all reasonably available transaction information to identify a Suspicious Order of an Opioid Product by a direct customer;
b. Utilize all reasonably available Downstream Customer Data to identify whether a Downstream Customer poses a material risk of diversion of an Opioid Product; c. Utilize all information Teva receives that bears upon a direct customer’s or a Downstream Customer’s diversion activity or potential for diversion activity, including reports by Teva’s employees, customers, Health Care Providers, law enforcement, state, tribal, or federal agencies, or the media; and d. Upon request (unless otherwise required by law), report to a State agency any direct customer or Downstream Customer in such agency’s State identified as part of the monitoring required by (a)-(c), above, and any customer relationship in such State terminated by Teva relating to diversion or potential for diversion.
These reports shall include the following information, to the extent known to Teva:
i. The identity of the downstream registrant and the direct customer(s) identified by Teva engaged in the controlled substance transaction(s), to include each registrant’s name, address, business type, and DEA registration number;
ii. The dates of reported distribution of controlled substances by direct customers to the downstream registrant during the relevant time period; iii. The drug name, drug family or NDC and dosage amounts reportedly distributed;
iv. The transaction or order number of the reported distribution; and v. A brief narrative providing a description of the circumstances leading to Teva’s conclusion that there is a risk of diversion.
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2. Teva shall not provide to any direct customer an Opioid Product to fill an order identified as a Suspicious Order unless Teva’s DEA Compliance Department investigates and finds that the order is not suspicious.
3. Upon request, Teva shall provide full cooperation and assistance to any federal, state or local law enforcement investigations of potential diversion or suspicious circumstances involving Opioid Products, including criminal law enforcement agencies, drug control agencies, professional licensing boards, and Attorney General’s offices.
I. General Terms
1. To the extent that any provision in the Agreement between Teva and the States conflicts with federal or state law or regulation, the requirements of the law or regulation will prevail.
2. Teva shall not make any written or oral statement about Opioids or any Opioid Product that is unfair, false, misleading, deceptive or unconscionable. For purposes of this paragraph, “Opioid Product” shall also include methadone, buprenorphine, and other substances when used exclusively to treat opioid abuse, addiction, or overdose
3. Teva shall not represent that Opioids or any Opioid Product(s) have approvals, characteristics, uses, benefits, or qualities that they do not have. For purposes of this paragraph, “Opioid Product” shall also include methadone, buprenorphine and other substances when used exclusively to treat opioid abuse, addiction, or overdose.
4. For the avoidance of doubt, nothing in this Agreement is intended to or shall be construed to prohibit Teva in any way whatsoever from (a) taking legal or factual positions with regard to its Opioid Product(s) in defense of litigation or other legal proceedings or investigations, (b) communicating its positions and responding to media inquiries concerning litigation, investigations, reports, or other documents or proceedings relating to Teva or its Opioid Products, or (c) maintaining a website explaining its litigation positions and responding to allegations concerning its Opioid Products.
5. Upon the request of any Settling State Attorney General, Teva shall provide the requesting State Attorney General with copies of the following, within 30 days of the request:
a. Any litigation or civil or criminal law enforcement subpoenas or Civil Investigative Demands relating to Teva’s Opioid Product(s); and b. Warning or untitled letters issued by the FDA regarding Teva’s Opioid Product(s) and all correspondence between Teva and the FDA related to such letters.
6. Nothing contained herein shall prohibit Teva from divesting any Opioid or Opioid Product, in each case, including providing technical development services, transferring know-how and patents, and/or providing such other support services in connection therewith, provided P-14
that all provisions of this Exhibit P shall apply to any subsequent purchaser with respect to the divested Opioid or Opioid Product.
7. This Exhibit P applies to the manufacture, sales, Promotion, marketing and distribution by Teva within the United States and its territories or involving Health Care Providers.
8. For the avoidance of doubt, nothing in this Exhibit P is intended to prohibit or restrict Teva's Promotion of non-Opioid products that are approved for the Treatment of Pain (including Ajovy), including by providing educational or other information about such non-Opioid products or providing support or funding to Third Parties specifically to support the use of such non-Opioid products. Teva shall not be restricted from referencing current pain care treatments or treatment modalities for purposes of Promotion of such nonOpioid products so long as such reference does not Promote Opioids or Opioid Products. The exclusion from this Consent Judgment of non-Opioid products approved for the Treatment of Pain shall in no way be construed as an approval or a sanction by the States of Teva’s business practices with respect to any such non-Opioid product.
J. Compliance with All Laws and Regulations Relating to the Sale, Promotion, and Distribution of Any Opioid Product
1. Teva shall comply with all state laws and regulations that relate to the sale, promotion, distribution, and disposal of any Opioid Product, provided that nothing in this paragraph requires Teva to violate federal law or regulations, including but not limited to:
a. State Controlled Substances Act, including all guidance issued by applicable state regulator(s);
b. State Consumer Protection Laws and Unfair Trade Practices Acts; c. State laws and regulations related to opioid prescribing, distribution and disposal; and
d. State Specific Laws.
K. Compliance Deadlines.
1. Teva must be in full compliance with the provisions included in Exhibit P by the Effective Date.
L. Training
1. Teva shall provide regular training, at least once per year, to relevant employees on their obligations imposed by this Agreement.
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III. CLINICAL DATA TRANSPARENCY
A. Data to Be Shared
1. Teva shall share the following clinical data through a third-party data archive that conforms to the requirements defined below to increase the transparency of its clinical research.
a. Teva shall make available all previously disclosed data and/or information regarding Teva Opioid Products;
b. Teva shall make available all previously unreleased data regarding Teva Opioid Products located in its possession, custody or control after a reasonably diligent search, for both approved and unapproved indications, including:
i. Full analyzable data set(s) (including individual participantlevel data de-identified by an independent biostatistician); ii. The clinical study report(s) redacted for commercial or personal identifying information;
iii. The full protocol(s) (including the initial version, final version, and all amendments); and
iv. Full statistical analysis plan(s) (including all amendments and documentation for additional work processes); and
c. Teva shall make available the above information for all studies for any new Teva Opioid Product or new indications within 6 months after regulatory approval or 18 months after study completion, whichever occurs later.
d. Data related to Investigator Sponsored Studies completed prior to the Effective Date are subject to the requirements in this Section III.A.1 if such data can be located in Teva’s possession, custody or control after a reasonably diligent search.
e. Data related to Investigator Sponsored Studies completed after the Effective Date are subject to the requirements of this Section III.A.1.
B. Third-Party Data Archive
1. Teva shall share the above information via a third-party data archive that makes clinical data available to Qualified Researchers with a bona fide scientific research proposal.
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2. The data archive shall have a panel of reviewers with independent review authority to determine whether the researchers are qualified, whether a research application seeks data for bona fide scientific research, and whether a research proposal is complete.
3. The panel may exclude research proposals with a commercial interest.
C. Non Interference
1. Teva shall not interfere with decisions made by the staff or reviewers associated with the third-party data archive.
D. Data Use Agreement
1. Any data sharing agreement with a Qualified Researcher who receives shared data via the third-party data archive shall contain contact information for Teva’s pharmacovigilance staff. Every agreement shall require the lead Qualified Researcher to inform Teva’s pharmacovigilance staff within 24 hours of any determination that research findings could detrimentally impact the risk-benefit assessment regarding the product. The lead Qualified Researcher may also inform regulatory authorities of the safety signal impacting the risk-benefit assessment.
Teva’s pharmacovigilance staff shall take all necessary and appropriate steps upon receipt of such safety information, including but not limited to notifying regulatory authorities or the public.
E. Cost
1. Teva shall bear all costs for making data and/or information available.
IV. TERM
A. Unless addressed in Section IV.B below, each term of this Exhibit P shall apply for thirteen (13) years from the Effective Date.
B. The provisions of Section II.A (“Ban on Promotion”), Section II.I (“General Provisions”), and Section II.J (“Compliance with All Laws and Regulations Relating to the Sale, Promotion and Distribution of Any Opioid Product”) shall not be subject to any term.
V. DOCUMENT DISCLOSURE
A. Documents Subject to Public Disclosure
The following documents must be provided to each Settling State and are subject to public disclosure in perpetuity, except for the redactions authorized by section B:
1. All Teva-produced documents admitted as trial exhibits in In re Opioid Litigation, Index No. 400000/2017 (N.Y. Sup. Ct., Suffolk County), The City and County of P-17
San Francisco, California and the People of the State of California, acting by and through San Francisco City Attorney David Chiu v. Purdue Pharma L.P., et al., Case No. 3:18-cv-7591-CRB (N.D. Cal.), The State of West Virginia ex rel. Patrick Morrisey, Attorney General v. Teva Pharmaceutical Industries Ltd., et al., Civil Action No. 19-C-104 BNE (W. Va. Cir. Ct., Boone County), or The People of the State of California, acting by and through Santa Clara County Counsel James R.
Williams, Orange County District Attorney Tony Rackauckas, Los Angeles County Counsel Mary C. Wickham, and Oakland City Attorney Barbara J. Parker v.
Purdue Pharma L.P., et al., Case No. 30-2014-00725287-CU-BT-CXC (Cal.
Super. Ct., Orange County) and Oklahoma v. Purdue Pharma L.P., et al., No. CJ2017-816 (Cleveland Cty., Okla. Dist. Ct.), together with complete trial transcripts.
2. All Teva deposition transcripts and exhibits from or produced in the matters identified in section A.1, as well as in In re Nat’l Prescription Opiate Litig., No. 1:17-MD-2804 (N.D. Ohio).
3. All summary judgment filings, proposed findings of fact and law, and expert reports relating to the claims against Teva that were filed in the matters identified in section A.2 and A.3, together with related exhibits.
4. All documents, indices, and privilege logs produced in In re Nat’l Prescription Opiate Litig., No. 1:17-MD-2804 (N.D. Ohio) (“the MDL”) bearing the bates prefixes Acquired_Actavis and TEVA_MDL_A and produced on or before October 4, 2019, except personnel files produced on Jan. 16, 2019, Jan. 20, 2019, Feb. 8, 2019, and Aug. 10, 2019.
5. All documents provided under this provision must be provided in an appropriate electronic format with appropriate metadata.
B. Information That Teva May Redact
1. The following categories of information are exempt from public disclosure:
a. Information subject to trade secret protection. A “trade secret” is information, including a formula, pattern, compilation, program, device, method, technique or process, that (a) derives independent economic value, actual or potential, from not being generally known to the public or to other persons who can obtain economic value from its disclosure and use; and (b) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. Even if the information falls within the definition, “trade secret” does not include information reflecting sales or promotional strategies, tactics, targeting, or data, or internal communications related to sales or promotion or information in documents dated more than five (5) years before the disclosure required by this section.
b. Confidential personal information. “Confidential personal information” means individual Social Security or tax identification numbers, personal financial account numbers, passport numbers, driver license numbers, home P-18
addresses, home telephone numbers, personal email addresses, and other personally identifiable information protected by law from disclosure. “Confidential personal information” does not include the names of Teva’s officers, directors, employees, consultants, agents, or attorneys or of prescribers or of officials of a government agency.
c. Information that is inappropriate for public disclosure because it is subject to personal privacy interests recognized by law (e.g., HIPAA), or contractual rights of third parties that Teva may not abrogate. d. Information regarding Teva employees’ personal matters unrelated to Teva, including emails produced by Teva custodians discussing vacation or sick leave, family, or other personal matters.
e. Information that is protected by the attorney–client or attorney work product privilege.
f. Financial documents designated as “Highly Confidential” or “Highly Confidential Information” under Case Management Order No. 2 in In re Nat’l Prescription Opiate Litig., No. 1:17-MD-2804 (N.D. Ohio) and produced in response to the April 3, 2019 Ruling Regarding Jurisdictional Discovery on Defendants Teva, and Mallinckrodt, including tax returns including all schedules and attachments, policies regarding accounting, and annual reports.
C. Redaction of Documents Containing Protected Information
1. Whenever a document contains information subject to a claim of exemption pursuant to section B, Teva will provide the document in redacted form. Such redactions must indicate that trade secret and/or private information, as appropriate, has been redacted. Redactions are limited to the minimum redactions possible, consistent with section B.
2. Teva must provide to each Settling State a log noting each document redacted. The log must also provide fields stating the basis for redacting the document, with sufficient detail to allow an assessment of the merits of the assertion. The log is subject to public disclosure in perpetuity. The log shall be provided by the production deadline.
3. In addition to the redacted documents, Teva shall, upon any Settling State’s request, also produce all documents identified in Section A above in unredacted form to such Settling State at the same time, but only to the extent the document was produced by Teva in an unredacted form in the underlying litigation, and only for the purpose of permitting a merits assessment and potential challenge of the redaction pursuant to section VII herein.
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D. Public Disclosure Through a Document Repository
1. Each Settling State may publicly disclose all documents covered by this section through a public repository maintained by a governmental, non-profit, or academic institution. Each Settling State may specify the terms of any such repository’s use of those documents, including allowing the repository to index and make searchable all documents subject to public disclosure, including the metadata associated with those documents.
E. Timeline for Production
1. Teva shall produce all documents required by Section A within nine months from the Effective Date.
F. Support Payment
1. Within thirty (30) calendar days of the Effective Date, Teva will make one-time payments totaling $1,375,000 to the University of California, San Francisco Foundation (UCSF Foundation) and The Johns Hopkins University, to be used to support a public repository of documents subject to this section.
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VI. INDEPENDENT MONITOR
A. Independent Monitor Committee
1. Within thirty (30) calendar days of the Effective Date, the Settling States shall designate a group of States to serve on an Independent Monitor Committee as the Settling States’ representatives in the administration of the relevant terms of these Independent Monitor provisions (hereinafter, “Independent Monitor Committee”).
B. Independent Monitor Selection and Engagement
1. Teva shall engage an Independent Monitor to review Teva’s compliance with this Exhibit P. The Independent Monitor shall have or shall employ or retain personnel who have appropriate qualifications and experience related to the pharmaceutical industry and the laws governing the manufacture, marketing and sale of pharmaceuticals and controlled substances and the applicable requirements of federal and state law. To the extent that additional expertise is required for the engagement, the Independent Monitor may retain the services of third-parties, after consultation with and input from Teva and the Independent Monitor Committee.
2. The Independent Monitor and any retained third-parties shall at all times act in good faith and with integrity and fairness towards all parties.
3. The parties have agreed that the initial Independent Monitor shall be Gil Soffer of Katten, Muchin Rosenman LLP
4. The Independent Monitor can be replaced upon agreement of the Independent Monitor Committee and Teva. If the parties so agree, the process for selecting a replacement Independent Monitor shall be the process described in paragraphs i-iii below. The provisions of this Exhibit P shall apply to any successor Independent Monitor. i. The Independent Monitor Committee and Teva will each identify the names of up to three (3) individuals, groups of individuals or firms as the pool of recommended candidates to serve as the Monitor, within (60) calendar days of the date the parties agree to replace the Monitor.
ii. The Independent Monitor Committee and Teva shall have the right to meet with and otherwise evaluate the candidates and conduct appropriate interviews of the personnel who are expected to work on the project. The following qualifications may be relevant considerations for the Independent Monitor Committee and Teva in evaluating candidates: (a) prior monitorship or oversight experience; (b) experience with federal health care and suspicious order monitoring laws, regulations, and programs; (c) experience with the pharmaceutical or health care industry; (d) access to sufficient resources to carry out the duties of the Monitor; and (e) experience with internal investigations or the investigative process.
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iii. If the Independent Monitor Committee and Teva do not agree on the appointment of any of the candidates from the initial pool of recommendations, the Independent Monitor Committee and/or Teva may identify additional qualified candidates, as the timeline permits. However, in the event the parties fail to reach agreement on a Monitor within ninety (90) calendar days of the date the parties agree to replace the monitor, the Independent Monitor Committee shall appoint an Independent Monitor.
5. In the event that the Independent Monitor Committee and Teva do not agree to the dismissal of the Independent Monitor, either the Independent Monitor Committee (through one of the Settling States on the Independent Monitor Committee) or Teva may submit the question of the Independent Monitor’s dismissal to the court to which the Consent Judgment was presented in any Settling States on the Independent Monitor Committee, and the Independent Monitor shall only be dismissed if the court finds that there is Good Cause for dismissal. Good Cause for dismissal shall mean (a) a material and substantial breach of the terms of this Exhibit P by the Independent Monitor, including the failure to comply with the terms and limitations of this Exhibit P; (b) any act of dishonesty, misappropriation, embezzlement, intentional fraud, or similar conduct by the Independent Monitor; (c) any intentional act of bias or prejudice in favor or against either party by the Independent Monitor; or (d) conduct by the Independent Monitor that demonstrates unfitness to fulfill the functions of the Independent Monitor reasonably and competently. Good Cause shall not include disagreements with the decisions of the Independent Monitor pursuant to this Exhibit P, unless there is a clear pattern in the Independent Monitor’s decisions that demonstrates that the Independent Monitor has not been acting as an independent third party in rendering decisions.
C. Costs of the Independent Monitor
1. Teva shall pay all reasonable and necessary fees and costs of the Independent Monitor. Reasonable and necessary fees and costs shall be limited to those set out in the Independent Monitor work plan and contract, but in no event shall they exceed $1,000,000 per year, inclusive of fees and costs for any personnel or third-parties that the Independent Monitor engages or retains.
D. Term and Reporting Periods
1. The term of the Independent Monitor will be five (5) years from the Effective Date, divided into ten (10) six-month periods for purposes of the reviews and reporting described in Section VI.H (“Reporting Periods”).
2. The Independent Monitor shall be terminated and the oversight shall cease within thirty (30) calendar days of the Independent Monitor Committee receiving a certification from Teva that it has stopped selling Opioid Products for end-use consumption in the United States.
E. Independent Monitor’s Scope of Work
1. The Independent Monitor’s responsibilities shall encompass Teva’s ongoing compliance P-22
with the specific requirements of the Exhibit P as it relates to the following areas: (1) Promotion and sale of Opioids or Opioid Products; (2) Promotion of Opioid-Induced Side Effects Treatment Product; (3) Promotion relating to the Treatment of Pain; (4) Financial Reward or Discipline Based on Volume of Opioid Sales; (5) funding and grants to third parties concerning Opioids, Opioid Products, or the Treatment of Pain; (6) lobbying concerning Opioids, Opioid Products, or the Treatment of Pain; (7) Prescription Savings Programs for Opioid Products; (8) Monitoring and Reporting of Direct and Downstream Customers; (9) training concerning Teva’s obligations under Exhibit P (hereinafter referred to as the “Scope of Work”). The Independent Monitor’s Scope of Work and review applies to the manufacture, sales, Promotion, marketing and distribution by Teva within the United States and its territories or involving Health Care Providers. The Independent Monitor will report his or her findings as provided in Section VI.H below.
2. Within thirty (30) calendar days after the appointment of the Independent Monitor, the Independent Monitor Committee and Teva shall agree with the Independent Monitor on a work plan and contract. The work plan shall set forth in detail the manner in which the Independent Monitor will carry out his or her responsibilities under this Exhibit P, and the general scope of information that the Independent Monitor will seek to review in fulfilling the Independent Monitor’s Scope of Work. It is not intended that the Independent Monitor will conduct his or her own inquiry into the historical events that allegedly gave rise to this Consent Judgment or into matters beyond the scope of the Injunctive Terms of this Consent Judgment. The work plan shall also include all reasonable and necessary costs of the Independent Monitor, as well as a process by which Teva may challenge Independent Monitor costs as excessive, duplicative or unnecessary.
3. If the Independent Monitor, the Independent Monitor Committee and Teva fail to reach agreement on a work plan within the designated time frame, the Independent Monitor Committee shall determine a fair and reasonable work plan and contract in consultation with Teva and the Independent Monitor.
4. At least annually, and more frequently if appropriate, Teva and the Independent Monitor Committee will meet in person or virtually to discuss the work of the Independent Monitor and any suggestions, comments, or improvements Teva may wish to discuss with or propose to the Independent Monitor Committee, including with respect to the scope and costs of the work of the Independent Monitor, unless Teva and the Independent Monitor Committee believe such a meeting is unnecessary.
F. Independent Monitor Access to Information
1. In connection with its review of Teva’s compliance with the terms identified in Section VI.E above, the Independent Monitor shall be vested with reasonably broad discretion to review Teva’s compliance with the terms of Exhibit P covered by the Scope of Work, including access to documents and the right to interview employees, as is reasonably necessary to fulfill its duties under this Consent Judgment, with reasonable notice to Teva and without unreasonable interference in Teva’s or its employees’ ability to perform dayto-day operations. The Independent Monitor shall have all powers reasonable and necessary to efficiently and effectively discharge its responsibilities.
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2. The Chief Compliance Officer of Teva shall serve as the primary point of contact for the Independent Monitor to facilitate the Independent Monitor's reasonable access to documents, materials, or employees necessary to review for compliance with Exhibit P.
The Independent Monitor shall make a good faith effort to leverage Teva’s existing compliance mechanisms when reviewing Teva’s compliance with the terms of Exhibit P identified in Section VI.E, above. The Independent Monitor shall communicate any request for documents, materials, or access to employees to the Chief Compliance Officer, but, subject to the terms hereof, is not prohibited from speaking with any other current or former employees of Teva. Teva shall not intimidate, harass, threaten, or penalize any employee or former employee for his or her cooperation with or assistance to the Independent Monitor.
3. If at any time the Independent Monitor reasonably believes that there is undue delay, resistance, interference, limitation, or denial of access to any records or to any employee deemed necessary by the Independent Monitor to implement or review compliance by Teva with the Injunctive Terms, the Independent Monitor may meet and confer with Teva’s Chief Compliance Officer. If the Independent Monitor cannot resolve such limitation or denial, it shall be immediately reported to the Independent Monitor Committee.
4. To the extent that any of the documents requested by the Independent Monitor contain material protected from disclosure by the attorney-client privilege or attorney work product doctrine, Teva may redact the privileged material before providing the documents to the Independent Monitor.
G. Settling States' Access to Independent Monitor
1. There shall be no limitation on the ability of the Independent Monitor to communicate at any time with Settling States regarding Teva’s conduct.
H. Independent Monitor Reports
1. Observations and Recommendations
i. To the extent that the reviews conducted by the Independent Monitor raise questions or concerns about particular decisions made or conduct engaged in by Teva regarding issues within the Scope of Work, the Independent Monitor may conduct interviews of personnel of Teva who were involved in the decisions or conduct at issue. If the Independent Monitor continues to have questions or concerns about particular decisions or conduct, after conducting interviews, the Independent Monitor shall include a description of the question or concern in the Final Report described below. If the Independent Monitor notes any areas for potential improvement regarding matters within the Scope of Work during the course of the reviews conducted pursuant to the Injunctive Relief Terms, the Independent Monitor shall include any such recommendations in the Final Report.
Collectively, any such questions, concerns or recommendations will be referred to as “Observations and Recommendations.”
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2. Draft and Final Reports
i. No later than thirty (30) calendar days after the close of a Reporting Period and/or at any other time deemed reasonably necessary by the Independent Monitor, the Independent Monitor shall provide Teva with a draft report identifying and detailing any Potential Violations and the bases therefore (the “Draft Report”).
Potential Violations shall mean Teva’s failure to comply with the specific provisions of Exhibit P that the Independent Monitor is tasked with overseeing as set forth in the Scope of Work and work plan, as reasonably determined by the Independent Monitor and supported by documentation (where available).
Identification of Potential Violations in the Draft Report shall not be considered a breach of the Consent Judgment. Teva shall have the right to cure any Potential Violation, in accordance with the below provisions. The Draft Report will also contain detailed descriptions of any Observations and Recommendations. ii. Within thirty (30) calendar days of its receipt of the Draft Report, Teva will provide comments and responses to the Draft Report. Teva will, among other things:
(1) Respond to each Potential Violation, including, where appropriate, explaining why no violation occurred, or describing any corrective action taken (or to be taken) as a result of the findings made by the Independent Monitor, including, where appropriate, providing documentation supporting a relevant decision or additional context explaining the Potential Violation and why it occurred. (2) Respond to each Observation and Recommendation.
iii. Within thirty (30) calendar days of receipt of Teva’s comments and responses to the Draft Report, the Independent Monitor shall provide a final report (the "Final Report"). The Final Report shall be provided simultaneously to the Independent Monitor Committee and Teva. The Independent Monitor Committee may share the Final Report with any Settling State. The Independent Monitor shall provide the Independent Monitor Committee with a copy of any Draft Report that has been subsequently revised upon conferral with Teva and, upon request, the Independent Monitor Committee shall be granted access to any other Draft Reports. iv. The Final Report shall set forth:
(1) The Independent Monitor’s evaluation of Teva’s compliance with the provisions identified in Sections VI.E and VI.F above and the factual basis for the Independent Monitor’s conclusions, including whether a Potential Violation has occurred and an explanation of the nature of the Potential Violation.
(2) The Independent Monitor’s conclusion as to whether Teva has cured any Potential Violations. In the event that the Independent Monitor changes its initial determination after receiving Teva’s response, the Independent Monitor will report its initial determination and its revised determination in the Final Report in sufficient detail so that the Independent Monitor P-25
Committee can evaluate the basis for both determinations. The identification of uncured Potential Violations in the Final Report can be considered a breach of the Consent Judgment.
(3) The Final Report need not recite or describe comprehensively Teva’s history or compliance policies, procedures and practices, but rather may focus on those areas with respect to which the Independent Monitor wishes to make recommendations, if any, for improvement or which the Independent Monitor otherwise concludes merit particular attention.
(4) The Final Report shall include a listing of the Observations and Recommendations made by the Independent Monitor and responses of Teva. v. For the duration of the Independent Monitor’s term, the Settling States may take any action against Teva to enforce the Injunctive Relief terms within the Independent Monitor’s Scope of Work as identified in Section VI.E above upon receiving notice of an uncured Potential Violation in a Final Report. The Settling States are not required to abide by the procedures set forth in the Notice and Cure provision below with regard to such uncured Potential Violations. vi. For the duration of the Independent Monitor’s term, should a Settling State disagree with the Independent Monitor’s determination as to whether a Potential Violation has occurred or been cured under the Injunctive Relief terms within the Independent Monitor’s Scope of Work as identified in Section VI.E above, the Settling State shall meet and confer with the Independent Monitor, the Independent Monitor Committee, and Teva to express its concerns. Teva shall have a reasonable opportunity to explain why it believes it is in compliance with Exhibit P, to further explain the actions taken to cure the Potential Violation and/or to take additional corrective actions to address the state’s concerns. If, after engaging in this meet and confer process and affording Teva a reasonable opportunity to explain or take further action, the Settling State is not satisfied that the Potential Violation has been cured, it may take any action to enforce the terms of this Consent Judgment. vii. Notwithstanding Sections VI.H.2.v and VI.H.2.vi, the Settling States may take any action, including, but not limited to legal action to enforce compliance with the Consent Judgment, without delay if the Settling State believes that a threat to the health or safety of the public requires immediate action. viii. The Independent Monitor's reports and testimony may be used by the Settling States in any action or proceeding. No action or lack of action by the Settling States regarding information received from the Independent Monitor regarding Teva's conduct shall be considered affirmation, acceptance, or ratification of that conduct by the Settling States.
ix. Nothing in this Judgment limits the right of the Settling States to conduct investigations or examinations unrelated to the work of the Independent Monitor.
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I. Confidentiality
1. Teva may designate materials and information that it believes contain trade secret or other commercially sensitive information as “Confidential.” Materials and information provided by Teva to the Independent Monitor that are designated “Confidential” (and any parts, portions, or derivations thereof) and shall not be disclosed or distributed to any person or entity other than those authorized by these provisions, subject to the provisions in Section VI.H.2.e.
2. All materials obtained from Teva by the Independent Monitor and in the Independent Monitor’s possession shall be returned to Teva or destroyed at the conclusion of the Independent Monitor’s term.
3. If any of the Settling States receive a request for disclosure of any material or information received by the Settling State from the Independent Monitor, pursuant to a subpoena, court order, data practices act, freedom of information act, public information act, public records act, or similar law (“Third Party Request”) the Attorney General shall notify Teva of the Third Party Request and the Confidential Information to be disclosed so that Teva may seek a protective order or otherwise challenge or object to the disclosure. Each of the Settling States agrees to provide Teva with at least ten (10) business days' advance notice before complying with any Third-Party Request for Confidential Information, except where state law requires a lesser period of advance notice.
J. Retention of Documents
1. Teva shall generate, retain and make readily available to any of the Settling States for inspection, upon reasonable notice and without the necessity of a subpoena or other legal process, all material records and documents reasonably necessary to document compliance with Exhibit P. Teva shall maintain these records and documents for a minimum of five (5) years after the Independent Monitor's last Final Report.
VII. ENFORCEMENT
A. For the purposes of resolving disputes with respect to compliance with Exhibit P, other than those addressed in Sections VI.H.2.v and VI.H.2.vi, should any of the Settling States have reason to believe that Teva has violated a provision of Exhibit P, then such Settling State shall notify Teva in writing of the specific objection, identify with particularity the provisions of Exhibit P that the practice appears to violate, and give Teva thirty (30) days to respond to the notification (“Response Period”).
B. Upon receipt of written notice from any of the Settling States, Teva shall provide a written response to the Settling State’s notification, containing either a statement explaining why Teva believes it is in compliance with Exhibit P, or a detailed explanation of how the alleged violation occurred and a statement explaining how and when Teva intends to remedy or has remedied the alleged violation. Teva may request a reasonable amount of additional time to cure any violation through such remedial measures (“Cure Period”) and the Settling State shall not unreasonably withhold approval of such request.
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C. The Settling State may not take any action concerning the alleged violation of Exhibit P during the Response and Cure Periods. Nothing shall prevent the Settling State from agreeing in writing to provide Teva with additional time beyond the thirty (30) days to respond to the notice. However, the Settling State may take any action, including, but not limited to legal action to enforce compliance with the Consent Judgment, without delay if the Settling State believes that a threat to the health or safety of the public requires immediate action.
D. The Settling State may bring an action against Teva to enforce the terms of Exhibit P, but only after providing Teva an opportunity to respond to the notification and, if agreed upon, a period to cure any violation, as described above, or within any other period as agreed to by Teva and the Settling State.
E. Nothing in this Consent Judgment shall be interpreted to limit any Settling State’s Civil Investigative Demand (“CID”) or investigative subpoena authority, to the extent such authority exists under applicable state law.
F. Nothing herein shall be construed to exonerate any failure to comply with any provision of Exhibit P after the Effective Date, or to compromise the authority of any Settling State to take action for any failure to comply with Exhibit P.
Q-1
Exhibit Q
Anda Injunctive Relief
I. INTRODUCTION
A. Within ninety (90) days of the Effective Date unless otherwise set forth herein, Anda shall implement the injunctive relief terms set forth in Sections II through XIX (the “Injunctive Relief Terms”) in its Controlled Substance Monitoring Program (“CSMP”).
B. The Effective Date of these Injunctive Relief Terms shall be defined by Section I of the Settlement Agreement, dated as of November 22, 2022, which incorporates these Injunctive Relief Terms as Exhibit Q.
C. The parties acknowledge that agreement to the Injunctive Relief Terms does not constitute an admission that Anda’s existing CSMP does not comply with the requirements of law. Anda shall modify its CSMP as required by the Injunctive Relief Terms within ninety (90) days of the Effective Date.
D. The Parties acknowledge that Anda is predominantly a Secondary Source Distributor (as defined herein) to the Anda Customers, has in place a CSMP, and will develop a modified CSMP in accordance with this Agreement, that is tailored to the business of distributing products to Customers as a Secondary Source Distributor. The Parties acknowledge that the Anda CSMP may be different from the CSMPs implemented by other distributors, including other Primary or Secondary Source Distributors.
E. Primary Source Distributors and Secondary Source Distributors may use different analytical tools to identify and characterize Customers’ ordering patterns, order frequencies and order sizes, and deviations therefrom. Analytical tools and, where applicable, algorithms, adopted and implemented by any particular distributor are not dispositive of the appropriate methods and tools to be implemented by Anda or other distributors.
F. Nothing contained herein shall prohibit Anda from divesting any or all of its distribution operations provided that all provisions of this Injunctive Relief shall apply to any subsequent purchaser with respect to the divested operations.
II. TERM
A. The duration of the Injunctive Relief Terms contained in Sections IV through XVI shall be ten (10) years from the Effective Date.
III. DEFINITIONS
A. “Anda.” Anda, Inc. and Anda Pharmaceuticals, Inc. and each of their current and former parents, subsidiaries, predecessors, successors, affiliates, divisions, assigns, officers, directors, agents, employees and principals.
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B. “Audit Report.” As defined in Section XVIII.I.3.
C. “Big 3 Distributor Injunctive Terms.” Exhibit P of the Settlement Agreement, dated as of July 21, 2021, between McKesson Corporation, Cardinal Health, Inc., and AmerisourceBergen Corporation and certain States and subdivisions.
D. “Chain Customers.” Chain retail pharmacies that have centralized corporate headquarters and have multiple specific retail pharmacy locations from which Controlled Substances are dispensed to individual patients.
E. “Chief Diversion Control Officer.” As defined in Section IV.A.
F. “Clearinghouse.” The system established by Section XVII of the Big 3 Distributor Injunctive Terms.
G. “Clearinghouse Advisory Panel.” As defined in Section XVII.B.4 of the Big 3 Distributor Injunctive Terms.
H. “Controlled Substances.” Those substances designated under schedules II-V pursuant to the federal Controlled Substances Act and the laws and regulations of the Settling States that incorporate federal schedules II-V. For purposes of the requirements of the Injunctive Relief Terms, Gabapentin shall be treated as a Controlled Substance, except for purposes of Section XII for Customers located in States that do not regulate it as a controlled substance or similar designation (e.g., drug of concern).
I. “Corrective Action Plan.” As defined in Section XIX.B.7.b.
J. “CSMP.” As defined in Section I.A.
K. “CSMP Committee.” As defined in Section VI.A.
L. “Customers.” Refers collectively to current, or where applicable potential, Chain Customers and Independent Retail Pharmacy Customers. “Customers” do not include long-term care facilities, hospital pharmacies, and pharmacies that serve exclusively inpatient facilities.
M. “Data Security Event.” Refers to any compromise, or threat that gives rise to a reasonable likelihood of compromise, by unauthorized access or inadvertent disclosure impacting the confidentiality, integrity, or availability of Dispensing Data.
N. “Dispensing Data.” Includes, unless altered by the Clearinghouse Advisory Panel:
(i) unique patient IDs; (ii) patient zip codes; (iii) the dates prescriptions were dispensed; (iv) the NDC numbers of the drugs dispensed; (v) the quantities of drugs dispensed; (vi) the day’s supply of the drugs dispensed; (vii) the methods of payment for the drugs dispensed; (viii) the prescribers’ names; (ix) the prescribers’ NPI or Q-3
DEA numbers; and (x) the prescribers’ zip codes or addresses. The Clearinghouse will be solely responsible for collecting Dispensing Data.
O. “Draft Report.” As defined in Section XVIII.I.1.
P. “Effective Date.” As defined in Section I.B.
Q. “Highly Diverted Controlled Substances.” Includes: (i) oxycodone; (ii) hydrocodone; (iii) hydromorphone; (iv) tramadol; (v) oxymorphone; (vi) morphine; (vii) methadone; (viii) carisoprodol; (ix) alprazolam; and (x) fentanyl. Anda shall annually review this list to determine whether changes are appropriate and shall add Controlled Substances to the list of Highly Diverted Controlled Substances as needed based on information provided by the DEA and/or other sources related to drug diversion trends. Anda shall notify the State Compliance Review Committee and the Monitor of any additions to the list of Highly Diverted Controlled Substances. Access to Controlled Substances predominately used for MedicationAssisted Treatment shall be considered when making such additions.
R. “Independent Retail Pharmacy Customers.” Retail pharmacy locations that do not have centralized corporate headquarters and dispense Controlled Substances to individual patients.
S. “Injunctive Relief Terms.” As defined in Section I.A.
T. “Monitor.” As defined in Section XVIII.
U. “National Arbitration Panel.” As defined by Section I of the Settlement Agreement, dated as of November 22, 2022 which incorporates these Injunctive Relief Terms as Exhibit.
V. “NDC.” National Drug Code.
W. “Non-Controlled Substance.” Prescription medications that are not Controlled Substances.
X. “Notice of Potential Violation.” As defined in Section XIX.B.2.
Y. “Order.” A unique Customer request on a specific date for (i) a certain amount of a specific dosage form or strength of a Controlled Substance or (ii) multiple dosage forms and/or strengths of a Controlled Substance. For the purposes of this definition, each line item on a purchasing document or DEA Form 222 is a separate order, except that a group of line items either in the same drug family or DEA base code (based upon the structure of Anda’s CSMP) may be considered to be a single order.
Z. “Pharmacy Customer Data.” Aggregated and/or non-aggregated data provided by the Customer for a 90-day period.
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1. To the extent feasible based on the functionality of a Customer’s pharmacy management system, Pharmacy Customer Data shall contain (or, in the case of non-aggregated data, shall be sufficient to determine) the following:
a) A list of the total number of prescriptions and dosage units for each NDC for all Controlled Substances and non-Controlled Substances; b) A list of the top five prescribers of each Highly Diverted Controlled Substance by dosage volume and the top ten prescribers of all Highly Diverted Controlled Substances combined by dosage volume. For each prescriber, the data shall include the following information:
(1) Number of prescriptions and doses prescribed for each Highly Diverted Controlled Substance NDC;
(2) Number of prescriptions for each unique dosage amount (number of pills per prescription) for each Highly Diverted Controlled Substance NDC; (3) Prescriber name, DEA registration number, and address; and (4) Medical practice/specialties, if available;
c) Information on whether the method of payment was cash for (a) Controlled Substances, and (b) non-Controlled Substances; and
d) Information on top ten patient residential areas by five-digit ZIP code prefix for filled Highly Diverted Controlled Substances by dosage volume, including number of prescriptions and doses for each Highly Diverted Controlled Substance NDC.
2. Anda is not required to obtain Pharmacy Customer Data for all Customers.
Pharmacy Customer Data only needs to be obtained under circumstances required by the Injunctive Relief Terms and the applicable CSMP policies and procedures. Anda’s CSMP policies and procedures shall describe the appropriate circumstances under which and methods to be used to obtain and analyze Pharmacy Customer Data.
3. Anda shall only collect, use, disclose or retain Pharmacy Customer Data consistent with applicable federal and state privacy and consumer protections laws. Anda shall not be required to collect, use, disclose or retain any data element that is prohibited by law or any element that would require notice to or consent from the party who is the subject of the data element, including, but not limited to, a third party (such as a prescriber) to permit collection, use, disclosure and/or retention of the data.
AA. “Primary Source Distributor.” With respect to any individual Customer, a distributor of pharmaceutical products who serves with respect to such Customer as the primary source of Controlled Substances to such Customer.
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BB. “Potential Violation.” As defined in Section XIX.B.1.
CC. “Reporting Periods.” As defined in Section XVIII.D.1.
DD. “Secondary Source Distributor.” With respect to any individual Customer, a distributor of pharmaceutical products who does not serve with respect to such Customer as the primary source of Controlled Substances to such Customer.
EE. “Settling State.” Means any Eligible State that has entered into the Settlement Agreement, dated as of November 22, 2022 which incorporates these Injunctive Relief Terms as Exhibit Q.
FF. “State Compliance Review Committee.” The initial State Compliance Review Committee members are representatives from the Attorneys General Offices of Connecticut, North Carolina, and Tennessee. The membership of the State Compliance Review Committee may be amended at the discretion of the Settling States.
GG. “Suspicious Orders.” As defined under federal law and regulation and the laws and regulations of the Settling States that incorporate the federal Controlled Substances Act. Suspicious Orders currently include, but are not limited to, orders of unusual size, orders deviating substantially from a normal pattern, and orders of unusual frequency.
HH. “Threshold.” The total volume of a particular drug family, DEA base code, or a particular formulation of a Controlled Substance that Anda shall allow a Customer to purchase in any particular period. This term may be reassessed during Phase 2-B of the Clearinghouse.
II. “Third Party Request.” A request from an entity other than Anda, a Settling State, or the Monitor pursuant to a subpoena, court order, data practices act, freedom of information act, public information act, public records act, or similar law.
JJ. “Top Prescriber.” A prescriber who, for a Customer, is either (i) among the top five (5) prescribers of each Highly Diverted Controlled Substance or (ii) among the top ten (10) prescribers of Highly Diverted Controlled Substances combined, as determined from the most recent Pharmacy Customer Data for that Customer.
IV. CSMP PERSONNEL
A. Anda shall establish or maintain the position of Chief Diversion Control Officer, or other appropriately titled position, to oversee Anda’s CSMP. The Chief Diversion Control Officer shall have appropriate experience regarding compliance with the laws and regulations concerning Controlled Substances, in particular laws and regulations requiring effective controls against the potential diversion of Controlled Substances. The Chief Diversion Control Officer shall report directly to either the Q-6
senior executive responsible for U.S. pharmaceutical distribution or the most senior legal officer at Anda.
B. The Chief Diversion Control Officer shall be responsible for the approval of material revisions to the CSMP.
C. The Chief Diversion Control Officer shall provide at least quarterly reports to the CSMP Committee regarding Anda’s operation of the CSMP, including the implementation of any changes to the CSMP required by these Injunctive Relief Terms.
D. Anda’s CSMP functions, including, but not limited to, the onboarding and approval of new Customers for the sale of Controlled Substances, setting and adjusting Customer Thresholds for Controlled Substances, terminating or suspending Customers, and submitting Suspicious Orders and other reports to Settling States (or the Clearinghouse, when operational), but excluding support necessary to perform these functions, shall be conducted exclusively by Anda’s CSMP personnel or qualified third-party consultants.
E. Staffing levels of Anda’s CSMP department shall be reviewed periodically, but at least on an annual basis, by Anda’s CSMP Committee. This review shall include consideration of relevant developments in technology, law, and regulations to ensure the necessary resources are in place to carry out the program in an effective manner.
F. Personnel in Anda’s CSMP department shall not report to individuals in Anda’s sales department, and sales personnel shall not be authorized to make decisions regarding the promotion, compensation, demotion, admonition, discipline, commendation, periodic performance reviews, hiring, or firing of CSMP personnel.
G. The CSMP policies and procedures shall be published in a form and location readily accessible to all CSMP personnel at Anda.
V. INDEPENDENCE
A. Anda’s sales personnel compensated with commissions shall not be compensated based on revenue or profitability targets or expectations for sales of Controlled Substances. However, Anda’s personnel may, as applicable, be compensated (including incentive compensation) based on formulas that include total sales for all of Anda’s products, including Controlled Substances. The compensation of sales personnel shall not include incentive compensation tied solely to sales of Controlled Substances.
B. For any Anda personnel who are compensated at least in part based on Customer sales, Anda shall ensure the compensation of such personnel is not decreased by a CSMP-related suspension or termination of a Customer or as a direct result of the reduction of sales of Controlled Substances to a Customer pursuant to the CSMP.
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C. Anda’s sales personnel shall not be authorized to make decisions regarding the implementation of CSMP policies and procedures, the design of the CSMP, the setting or adjustment of Thresholds, or other actions taken pursuant to the CSMP, except sales personnel must provide information regarding compliance issues to CSMP personnel promptly. Anda’s sales personnel are prohibited from interfering with, obstructing, or otherwise exerting control over any CSMP department decision-making.
D. Anda shall review its compensation and non-retaliation policies and, if necessary, modify and implement changes to those policies to effectuate the goals of, and incentivize compliance with, the CSMP.
E. Anda shall maintain a telephone, email, and/or web-based “hotline” to permit employees and/or Customers to anonymously report suspected diversion of Controlled Substances or violations of the CSMP, Anda company policy related to the distribution of Controlled Substances, or applicable law. Anda shall share the hotline contact information with their employees and Customers. Anda shall maintain all complaints made to the hotline, and document the determinations and bases for those determinations made in response to all complaints.
VI. OVERSIGHT
A. To the extent not already established, Anda shall establish a committee that includes senior executives with responsibility for legal, compliance, distribution and finance to provide oversight over its CSMP (the “CSMP Committee”). The Chief Diversion Control Officer shall be a member of the CSMP Committee. The CSMP Committee shall not include any employee(s) or person(s) performing any sales functions on behalf of Anda; provided that service on the CSMP Committee by any senior executives listed in this paragraph whose responsibilities may include, but are not limited to, management of sales functions shall not constitute a breach of the Injunctive Relief Terms.
B. Anda’s CSMP Committee shall have regular meetings during which the Chief Diversion Control Officer shall present to the CSMP Committee with respect to, and the CSMP Committee shall evaluate, among other things: (1) any material modifications and potential enhancements to the CSMP including, but not limited to, those relating to Customer due diligence and Suspicious Order monitoring and reporting; (2) any significant new national and regional diversion trends involving Controlled Substances; (3) Anda’s adherence to the CSMP policies and procedures, the Injunctive Relief Terms, and applicable laws and regulations governing the distribution of Controlled Substances; and (4) any technology, staffing, or other resource needs for the CSMP. The CSMP Committee shall have access to all CSMP reports. The CSMP Committee will review and approve the specific metrics used to identify the Red Flags set forth in Section VIII.
C. On a quarterly basis, Anda’s CSMP Committee shall send a written report to Anda’s Chief Executive, Chief Financial, and Chief Legal Officer, as well as its Board of Directors, addressing: (1) Anda’s substantial adherence to the CSMP policies and Q-8
procedures, the Injunctive Relief Terms, and applicable laws and regulations governing the distribution of Controlled Substances; (2) recommendations as appropriate about the allocation of resources to ensure the proper functioning of Anda’s CSMP; and (3) significant revisions to the CSMP. The Board of Directors or a committee thereof at Anda shall document in its minutes its review of the quarterly CSMP Committee reports.
D. To the extent not already established, the Board of Directors of Anda shall establish its own compliance committee (the “Board Compliance Committee”) to evaluate, at a minimum, and on a quarterly basis: (1) the CSMP Committee’s written reports; (2) Anda’s substantial adherence to the CSMP policies and procedures, the Injunctive Relief Terms, and applicable laws and regulations governing the distribution of Controlled Substances; (3) Anda’s code of conduct and any whistleblower reporting policies, including those prescribed by Section V.E; and (4) any significant regulatory and/or government enforcement matters within the review period relating to the distribution of Controlled Substances. Anda meets this requirement if it established, prior to the Effective Date, multiple committees of its Board of Directors that together have responsibilities outlined in this paragraph.
E. The Board Compliance Committee shall have the authority to: (1) require management of Anda to conduct audits on any CSMP or legal and regulatory concern pertaining to Controlled Substances distribution, and to update its full Board of Directors on those audits; (2) to commission studies, reviews, reports, or surveys to evaluate Anda’s CSMP performance; (3) request meetings with Anda’s management and CSMP staff; and (4) review the appointment, compensation, performance, and replacement of Anda’s Chief Diversion Control Officer.
VII. MANDATORY TRAINING
A. Anda shall require all new CSMP personnel to attend trainings on its CSMP, its obligations under the Injunctive Relief Terms, and its duties with respect to maintaining effective controls against potential diversion of Controlled Substances and reporting Suspicious Orders pursuant to state and federal laws and regulations prior to conducting any compliance activities for Anda without supervision.
B. Anda shall provide annual trainings to CSMP personnel on its CSMP, its obligations under the Injunctive Relief Terms, and its duties to maintain effective controls against potential diversion of Controlled Substances and report Suspicious Orders pursuant to state and federal laws and regulations.
C. On an annual basis, Anda shall test its CSMP personnel on their knowledge regarding its CSMP, its obligations under the Injunctive Relief Terms, and its duties to maintain effective controls against potential diversion of Controlled Substances and to report Suspicious Orders pursuant to state and federal laws and regulations.
D. Anda shall train all third-party compliance consultants (defined as non-employees who are expected to devote fifty percent (50%) or more of their time to performing work related to Anda’s CSMP, excluding information technology consultants not Q-9
engaged in substantive functions related to Anda’s CSMP) performing compliance functions for Anda in the same manner as Anda’s CSMP personnel.
E. At least every three (3) years in the case of existing employees, and within the first six (6) months of hiring new employees, Anda shall require operations, sales, and senior executive employees to attend trainings on its CSMP, its obligations under the Injunctive Relief Terms, the hotline established in Section V.E, and its duties to maintain effective controls against potential diversion of Controlled Substances and report Suspicious Orders pursuant to state and federal laws and regulations.
VIII. RED FLAGS
A. Within one hundred and twenty days (120) of the Effective Date, Anda shall, at a minimum, apply specific metrics to identify the potential Red Flags described in Section VIII.D with respect to Independent Retail Pharmacy Customers. For Chain Customers, the metrics used to identify the Red Flags described in Section VIII.D may be adjusted based on the specific business model and supplier relationships of the Chain Customer.
B. Anda shall evaluate and, if necessary, enhance or otherwise adjust the specific metrics it uses to identify Red Flags set forth in Section VIII.D.
C. Anda shall provide annually to the Monitor the specific metrics it uses to identify Red Flags as set forth in Section VIII.D. The Monitor shall review the metrics used to identify Red Flags as set forth in Section VIII.D to assess whether the metrics are reasonable. The Monitor may, at its discretion, suggest revisions to the metrics in the annual Audit Report as part of the Red Flags Review set forth in Section XVIII.G.3.f. Anda may rely on its specific metrics to comply with the requirements of Section VIII unless and until the Monitor proposes a revised metric in connection with Section XVIII.
D. For purposes of the Injunctive Relief Terms, “Red Flags” are defined as follows:
1. Ordering ratio of Highly Diverted Controlled Substances to nonControlled Substances: Analyze the ratio of the order volume of all Highly Diverted Controlled Substances to the order volume of all non-Controlled Substances to identify Customers with significant rates of ordering Highly Diverted Controlled Substances.
2. Ordering ratio of Highly Diverted Controlled Substance base codes or drug families to non-Controlled Substances: Analyze the ratio of the order volume of each Highly Diverted Controlled Substance base code or drug family to the total order volume of all non-Controlled Substances to identify Customers with significant rates of ordering each Highly Diverted Controlled Substance base code or drug family.
3. Excessive ordering growth of Controlled Substances: Analyze significant increases in the ordering volume of Controlled Substances using criteria to Q-10
identify customers that exhibit percentage growth of Controlled Substances substantially in excess of the percentage growth of non-Controlled Substances.
4. Unusual formulation ordering: Analyze ordering of Highly Diverted Controlled Substances to identify customers with significant ordering of high-risk formulations. High-risk formulations include, but are not limited to, 10mg hydrocodone, 8mg hydromorphone, 2mg alprazolam, singleingredient buprenorphine (i.e., buprenorphine without naloxone), and highly-abused formulations of oxycodone. On an annual basis (or as otherwise necessary), high-risk formulations of Highly Diverted Controlled Substances may be added, removed, or revised based on Anda’s assessment and regulatory guidance.
5. Out-of-area patients: Analyze Pharmacy Customer Data or Dispensing Data to assess volume of prescriptions for Highly Diverted Controlled Substances for out-of-area patients (based on number of miles traveled between a patient’s zip code and the pharmacy location, depending on the geographic area of interest) taking into consideration the percentage of outof-area patients for non-Controlled Substances.
6. Cash prescriptions: Analyze Pharmacy Customer Data or Dispensing Data to assess percentage of cash payments for purchases of Controlled Substances taking into consideration the percentage of cash payments for purchases of non-Controlled Substances.
7. Prescriber activity of Customers: Analyze Pharmacy Customer Data or Dispensing Data to identify Customers that are dispensing Highly Diverted Controlled Substance prescriptions for Top Prescribers as follows:
a) Top Prescribers representing a significant volume of dispensing where the prescriber’s practice location is in excess of 50 miles from the pharmacy (“out-of-area”), relative to the percentage of out-ofarea prescriptions for non-Controlled Substances. b) Top Prescribers representing prescriptions for the same Highly Diverted Controlled Substances in the same quantities and dosage forms indicative of pattern prescribing (e.g., a prescriber providing many patients with the same high-dose, high-quantity supply of 30mg oxycodone HCL prescription without attention to the varying medical needs of the prescriber’s patient population).
c) Top Prescribers where the top five (5) or fewer prescribers represent more than fifty percent (50%) of total prescriptions for Highly Diverted Controlled Substances during a specified period.
8. Public regulatory actions against Customers: Review information retrieved from companies that provide licensing and disciplinary history records (e.g., LexisNexis), and/or other public sources, including governmental entities, showing that the Customer, pharmacists working for that Customer, or the Customer’s Top Prescribers have been subject, in the last five (5) years, to professional disciplinary sanctions regarding the Q-11
dispensing or handling of Controlled Substances or law enforcement action related to Controlled Substances diversion. Continued licensing by a relevant state agency may be considered, but shall not be dispositive, in resolving the Red Flag. For Chain Customer locations, representations from each Chain Customer that it reviews its pharmacists’ licensing statuses annually and for the regulatory actions described in this paragraph has either (i) taken appropriate employment action, or (ii) disclosed the regulatory action to Anda, may be considered in resolving the Red Flag.
9. Customer termination data: Review information from Anda’s due diligence files and, when operable, from the Clearinghouse, subject to Section VIII.F, regarding Customers that have been terminated from ordering Controlled Substances by another distributor due to concerns regarding Controlled Substances.
E. For any Red Flag evaluation in Section VIII.D that may be performed using Pharmacy Customer Data or Dispensing Data, Anda will analyze the Red Flag using Pharmacy Customer Data, to the extent feasible based on the functionality of a Customer’s pharmacy management system, until Dispensing Data is collected and analyzed by the Clearinghouse as described in Section XVII. Until Dispensing Data is collected and analyzed by the Clearinghouse, Anda may satisfy the Red Flag evaluations in Sections VIII.D.5 through VIII.D.7 by engaging in considerations of out-of-area patients, cash payments for prescriptions and Top Prescribers without satisfying the specific requirements of Sections VIII.D.5 through VIII.D.7. In the event that the Clearinghouse is not collecting and analyzing Dispensing Data within two years of the Effective Date, Anda and the State Compliance Review Committee shall meet and confer to consider alternatives for the performance of the analysis required by Sections VIII.D.5 through VIII.D.7 using Pharmacy Customer Data.
F. The foregoing Red Flag evaluations may be performed by the Clearinghouse and reported to Anda.
G. Anda and the State Compliance Review Committee shall work in good faith to identify additional potential Red Flags that can be derived from the data analytics to be performed by the Clearinghouse.
IX. ONBOARDING
A. Anda, prior to initiating the sale of Controlled Substances to a potential Customer, a member of Anda’s CSMP department (or a qualified third-party compliance consultant trained on Anda’s CSMP) shall perform the following due diligence:
1. Interview the pharmacist-in-charge, either over the telephone, via videoconference, or in person. The interview shall include questions regarding the manner in which the potential Customer maintains effective controls against the potential diversion of Controlled Substances.
2. Obtain a “Pharmacy Questionnaire” completed by the owner and/or pharmacist-in-charge of the potential Customer. The Pharmacy Questionnaire shall require going-concern potential Customers to list their Q-12
top ten (10) prescribers for Highly Diverted Controlled Substances combined, along with the prescriber’s specialty, unless Anda is able to obtain this data otherwise. The Pharmacy Questionnaire shall also require disclosure of the identity of all other distributors that serve the potential Customer, and whether the potential Customer has been terminated or suspended from ordering Controlled Substances by another distributor and the reason for any termination or suspension. The Pharmacy Questionnaire shall request information that would allow Anda to identify Red Flags, including questions regarding the manner in which the potential Customer maintains effective controls against the potential diversion of Controlled Substances. A potential Customer’s responses to the Pharmacy Questionnaire shall be verified, to the extent applicable and practicable, against external sources (for example, the Clearinghouse, once operational, and Automation of Reports and Consolidated Orders System (“ARCOS”) data made available to Anda by the DEA). The Pharmacy Questionnaire shall be maintained by Anda in a database accessible to its CSMP personnel.
3. Complete a written onboarding report to be maintained in a database accessible to Anda’s CSMP personnel reflecting the findings of the interview and any site visit, the findings regarding the identification of and, if applicable, conclusion concerning any Red Flag associated with the pharmacy, as well as an analysis of the Pharmacy Questionnaire referenced in the preceding paragraph.
4. For going-concern potential Customers, review Pharmacy Customer Data to assist with the identification of any Red Flags.
5. Document whether the potential Customer or the pharmacist-in-charge has been subject to any professional disciplinary sanctions or law enforcement activity related to Controlled Substances dispensing, and, if so, the basis for that action. For Chain Customers, this provision shall apply to the potential specific pharmacies in question.
B. For Chain Customers, Anda may obtain the information in Section IX.A from a corporate representative of the Chain Customer.
C. In the event that Anda identifies one or more unresolved Red Flags or other information indicative of potential diversion of Controlled Substances through the onboarding process or otherwise, Anda shall refrain from selling Controlled Substances to the potential Customer pending additional due diligence. If following additional due diligence, Anda is unable to resolve the Red Flags or other information indicative of diversion, Anda shall not initiate the sale of Controlled Substances to the potential Customer and shall report the potential Customer consistent with Section XIV. If Anda determines that the potential Customer may be onboarded for the sale of Controlled Substances, Anda shall document the decision and the bases for its decision. Such a good faith determination, if Q-13
documented, shall not serve, without more, as the basis of a future claim of noncompliance with the Injunctive Relief Terms. For Chain Customers, these provisions shall apply to the potential specific pharmacies in question.
X. ONGOING DUE DILIGENCE
A. Anda shall periodically review its procedures and systems for detecting patterns or trends in Customer order data or other information used to evaluate whether a Customer is maintaining effective controls against diversion.
B. Anda shall conduct periodic proactive compliance reviews of its Customers’ performance in satisfying their corresponding responsibilities to maintain effective controls against the diversion of Controlled Substances.
C. Anda shall review ARCOS data made available to it by the DEA and, once operational, by the Clearinghouse, to assist with Customer specific due diligence.
For Chain Customers, this provision shall apply to the potential specific pharmacies in question.
D. Anda shall conduct due diligence as set forth in its CSMP policies and procedures in response to concerns of potential diversion of Controlled Substances at its Customers. For Chain Customers, these provisions shall apply to the specific pharmacies in question. The due diligence required by Anda’s CSMP policies and procedures may depend on the information or events at issue. The information or events raising concerns of potential diversion of Controlled Substances at a Customer include but are not limited to:
1. The discovery of one or more unresolved Red Flags;
2. The receipt of information directly from law enforcement or regulators concerning potential diversion of Controlled Substances at or by a Customer;
3. The receipt of information concerning the suspension or revocation of pharmacist’s DEA registration or state license related to potential diversion of Controlled Substances;
4. The receipt of reliable information through the hotline established in Section V.E concerning suspected diversion of Controlled Substances at the Customer;
5. The receipt of reliable information from another distributor concerning suspected diversion of Controlled Substances at the Customer; or
6. Receipt of other reliable information that the Customer is engaged in conduct indicative of diversion or is failing to adhere to its corresponding responsibility to prevent the diversion of Highly Diverted Controlled Substances.
E. On an annual basis, Anda shall obtain updated pharmacy questionnaires from one hundred (100) Customers to include the following:
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1. The top 25 Customers by combined volume of Highly Diverted Controlled Substances purchased from Anda measured as of the end of the relevant calendar year; and
2. Additional Customers selected as a representative sample of various geographic regions, customer types (Independent Retail Pharmacy Customers and Chain Customers), and distribution centers. Anda’s Chief Diversion Control Officer shall develop risk-based criteria for the sample selection.
F. Scope of Review
1. For reviews triggered by Section X.D, Anda shall conduct due diligence and obtain updated Pharmacy Customer Data or equivalent, or more comprehensive data from the Clearinghouse if needed, as set forth in its CSMP policies and procedures.
2. For questionnaires collected pursuant to Section X.E, Anda shall conduct a due diligence review consistent with Anda’s CSMP policies and procedures.
These annual diligence reviews shall be performed in addition to any of the diligence reviews performed under Section X.D, but may reasonably rely on reviews performed under Section X.D.
3. If Anda decides to terminate the Customer due to concerns regarding potential diversion of Controlled Substances, Anda shall promptly cease the sale of Controlled Substances to the Customer and report the Customer consistent with Section XIV. If Anda decides not to terminate the Customer, Anda shall document that determination and the basis therefor. Such a good faith determination, if documented, shall not, without more, serve as the basis of a future claim of non-compliance with the Injunctive Relief Terms.
XI. SITE VISITS
A. Anda shall conduct site visits, including unannounced site visits, where appropriate, of Customers, as necessary, as part of Customer due diligence.
B. During site visits, Anda’s CSMP personnel or qualified third-party compliance consultants shall interview the pharmacist-in-charge or other relevant Customer employees, if appropriate, about any potential Red Flags and the Customer’s maintenance of effective controls against the potential diversion of Controlled Substances.
C. Anda’s CSMP personnel or qualified third-party compliance consultants who conduct site visits shall document the findings of any site visit.
D. Site visit and all other compliance reports shall be maintained by Anda in a database accessible to all CSMP personnel.
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XII. THRESHOLDS
A. Anda shall use Thresholds to identify potentially Suspicious Orders of Controlled Substances from Customers.
B. Anda’s CSMP department shall be responsible for the oversight of the process for establishing and modifying Thresholds. The sales departments of Anda shall not have the authority to establish or adjust Thresholds for any Customer or participate in any decisions regarding establishment or adjustment of Thresholds.
C. Anda shall not provide Customers specific information about their Thresholds or how their Thresholds are calculated.
1. Threshold Setting
a) Anda shall primarily use model-based thresholds. For certain circumstances, Anda may apply a non-model threshold based on documented customer diligence and analysis.
b) Anda shall include in its Annual Threshold Analysis and Assessment Report (as required by Section XVIII.G.3.c) to the Monitor summary statistics regarding the use of non-model thresholds and such information shall be considered by the Monitor as part of its Threshold Setting Process Review in the annual Audit Report. c) For the purposes of establishing and maintaining Thresholds, Anda shall take into account the Controlled Substances diversion risk of each drug base code. The diversion risk of each base code should be defined and reassessed annually by Anda’s CSMP Committee and reviewed by the Monitor.
d) Anda shall establish Thresholds for new Customers prior to supplying those Customers with Controlled Substances and shall continue to have Thresholds in place at all times for each Customer to which it supplies Controlled Substances.
e) When ordering volume from other distributors becomes readily available from the Clearinghouse, Anda shall consider including such information as soon as reasonably practicable in establishing and maintaining Thresholds.
f) Anda shall incorporate the following guiding principles in establishing and maintaining Customer Thresholds, except when inapplicable to non-model Thresholds:
(1) Thresholds shall take into account the number of nonControlled Substance dosage units distributed to, dispensed and/or number of prescriptions dispensed by the Customer to assist with the determination of Customer size. As a general Q-16
matter, smaller customers should have lower Thresholds than larger customers.
(2) For the purposes of establishing and maintaining Thresholds, Anda shall use statistical models that are appropriate to the underlying data.
(3) For the purposes of establishing and maintaining Thresholds, Anda shall take into account a Customer’s ordering and/or dispensing history for a specified period of time.
(4) For the purposes of establishing and maintaining Thresholds, Anda shall take into account the ordering history of
Customers within similar geographic regions, or, where
appropriate for Chain Customers, ordering history within the chain.
(5) If appropriate, Thresholds may take into account the characteristics of Customers with similar business models. (a) A Customer’s statement that it employs a particular business model must be verified, to the extent
practicable, before that business model is taken into
account in establishing and maintaining a Customer’s
Threshold.
2. Threshold Auditing
a) Anda shall review their respective Customer Thresholds at least on an annual basis and modify them where appropriate.
b) Anda’s CSMP department shall annually evaluate its Threshold setting methodology and processes and its CSMP personnel’s performance in adhering to those policies.
3. Threshold Changes
a) Anda may increase or decrease a Customer Threshold as set forth in its CSMP policies and procedures, subject to Sections XII.C.3.b through XII.C.3.e.
b) Prior to approving any Threshold change request by a Customer, Anda shall conduct due diligence to determine whether an increase to the Threshold is warranted. This due diligence shall include obtaining from the Customer the basis for the Threshold change request, obtaining and reviewing Dispensing Data and/or Pharmacy Customer Data for the previous three (3) months for due diligence purposes, and, as needed, conducting an on-site visit to the Customer.
This Threshold change request diligence shall be conducted by Anda’s CSMP personnel.
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c) Anda shall not proactively contact a Customer to suggest that the Customer request an increase to any of its Thresholds, to inform the Customer that its Orders-to-date are approaching its Thresholds or to recommend to the Customer the amount of a requested Threshold increase. It shall not be a violation of this paragraph to provide Chain Customer headquarters reporting on one or more individual Chain Customer pharmacy location(s) to support the anti-diversion efforts of the Chain Customer’s headquarters staff, and it shall not be a violation of this paragraph for Anda’s CSMP personnel to contact Customers to seek to understand a Customer’s ordering patterns. d) Anda’s Chief Diversion Control Officer may approve criteria for potential adjustments to Customer Thresholds to account for circumstances where the Thresholds produced by the ordinary operation of the statistical models require modification. Such circumstances include adjustments to account for seasonal ordering of certain Controlled Substances that are based on documented diligence and analysis, adjustments made to permit ordering of certain Controlled Substances during a declared national or state emergency (e.g., COVID-19 pandemic), IT errors, and data anomalies causing results that are inconsistent with the design of the statistical models. Anda shall include in its Annual Threshold Analysis and Assessment Report (as required by Section
XVIII.G.3.c) to the Monitor information regarding the use of this paragraph and such information shall be considered by the Monitor as part of its Threshold Setting Process Review in the annual Audit Report.
e) Any decision to raise a Customer’s Threshold in response to a request by a Customer to adjust its Threshold must be documented in a writing and state the reason(s) for the change. The decision must be consistent with Anda’s CSMP and documented appropriately.
XIII. SUSPICIOUS ORDER REPORTING AND NON-SHIPMENT
A. Anda shall report Suspicious Orders to the Settling States (“Suspicious Order Reports” or “SORs”), including those Settling States that do not currently require such SORs, at the election of the Settling State.
B. For the SORs required by the Injunctive Relief Terms, Anda shall report Orders that exceed a Threshold for Controlled Substances set pursuant to the processes in Section XII that are blocked and not shipped.
C. Anda shall not ship any Order that it (i) reports pursuant to Sections XIII.A or XIII.B, or (ii) would have been required to report pursuant to Sections XIII.A or XIII.B had the Settling State elected to receive SORs.
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D. In reporting Suspicious Orders to the Settling States, Anda shall file SORs in a standardized electronic format that is uniform among the Settling States and contains the following information fields:
1. Customer name;
2. Customer address;
3. DEA registration number;
4. State pharmacy license number;
5. Date of order;
6. NDC number;
7. Quantity;
8. Explanation for why the order is suspicious (up to 250 characters): Details that are order-specific regarding why an order was flagged as a Suspicious Order, including specific criteria used by Anda’s Threshold system (except phrases such as “order is of unusual size” without any additional detail are not acceptable); and
9. Name and contact information for a knowledgeable designee within Anda’s CSMP department to be a point of contact for the SORs.
E. On a quarterly basis, Anda shall provide a summary report to the Settling States that elect to receive it that provides the following information for the relevant quarter with respect to the top ten (10) Customers by volume for each Highly Diverted Controlled Substance base code that have placed a Suspicious Order for that base code, in that quarter (for Chain Customers, only individual pharmacies in the chain will considered for evaluation as a top ten (10) Customer):
1. The number of SORs submitted for that Customer by base code;
2. The Customer’s order volume by base code for the quarter for all Highly Diverted Controlled Substances;
3. The Customer’s order frequency by base code for the quarter for all Highly Diverted Controlled Substances;
4. For each Highly Diverted Controlled Substance base code, the ratio of the Customer’s order volume for that base code to the volume of all pharmaceutical orders for the quarter; and
5. The ratio of the Customer’s order volume of all Controlled Substances to the volume of all pharmaceutical orders for the quarter.
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F. Anda shall only be required to file a single, uniform, electronic form of SOR with any Settling State that receives SORs pursuant to these Injunctive Relief Terms. A Settling State retains the authority pursuant to applicable state law or relevant state agency authority to request additional information about a particular SOR.
G. It is the objective of the Settling States and Anda for Anda to provide SORs to Settling States that identify the same Suspicious Orders as reported to the DEA pursuant to the definition and requirements of the federal Controlled Substances Act and its regulations, although the fields of the SORs submitted to the Settling States as required by Section XIII may differ from the content required by the DEA. To the extent federal definitions and requirements materially change during the term of the Injunctive Relief Terms, Anda may be required to adjust the format and content of the SORs to meet these federal requirements. Anda and the State Compliance Review Committee will engage in good faith discussions regarding such adjustments.
H. It shall not be a violation of the Injunctive Relief Terms if Anda ships a Suspicious Order or fails to submit or transmit a SOR if:
1. The shipment of the Suspicious Order or failed SOR transmission was due to a computer error (data entry mistakes, coding errors, computer logic issues, software malfunctions, and other computer errors or IT failures); and
2. Anda reports the error, including a description of measures that will be taken to prevent recurrence of the error, to any affected Settling State, the State Compliance Review Committee, and the Monitor within five (5) business days of its discovery.
XIV. TERMINATED CUSTOMERS
A. Anda shall report to the Clearinghouse, once operational, within five (5) business days (or as otherwise required by state statute or regulation), Customers it has terminated from eligibility to receive Controlled Substances or refused to onboard for the sale of Controlled Substances due to concerns regarding the Customer’s ability to provide effective controls against the potential diversion of Controlled Substances following the Effective Date.
B. Anda shall report to the relevant Settling State(s), within five (5) business days (or as otherwise required by state statute or regulation) Customers located in such Settling States that it has terminated from eligibility to receive Controlled Substances or refused to onboard for the sale of Controlled Substances due to concerns regarding the Customer’s ability to provide effective controls against the potential diversion of Controlled Substances following the Effective Date. Such reports will be made in a uniform format. Anda and the State Compliance Review Committee shall use best efforts to agree on such uniform format for inclusion prior to the requirement taking effect.
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C. In determining whether a Customer should be terminated from eligibility to receive Controlled Substances, Anda shall apply factors set out in its CSMP policies and procedures, which shall include the following conduct by a Customer:
1. Has generated an excessive number of Suspicious Orders, which cannot otherwise be explained;
2. Has routinely demonstrated unresolved Red Flag activity;
3. Has continued to fill prescriptions for Highly Diverted Controlled Substances that raise Red Flags following Anda’s warning or communication about such practices;
4. Has failed to provide Pharmacy Customer Data or Dispensing Data in response to a request from Anda or otherwise refuses to cooperate with Anda’s CSMP after providing the Customer with a reasonable amount of time to respond to Anda’s requests;
5. Has been found to have made material omissions or false statements on a Pharmacy Questionnaire (the requirements for the contents of a Pharmacy Questionnaire are described in Section IX); or
6. Has been the subject of discipline by a State Board of Pharmacy within the past three (3) years or has had its owner(s) or pharmacist-in-charge subject to license probation or termination within the past five (5) years by a State Board of Pharmacy for matters related to Controlled Substances dispensing or a federal or state felony conviction.
D. Once the Clearinghouse has made Customer termination data available to Anda, Anda shall consider terminating Customers that have been terminated from eligibility to receive Controlled Substances by another distributor as a result of suspected diversion of Controlled Substances if the Customer is ordering only Controlled Substances from Anda. If Anda determines not to terminate Customers to which this paragraph applies, Anda shall document its decision-making. A good-faith decision to continue shipping Controlled Substances to Customers to which this paragraph applies, shall not serve, without more, as the basis of a future claim of non-compliance with the Injunctive Relief Terms.
E. For Chain Customers, the provisions in Section XIV.A-D shall apply to the specific pharmacies in question.
XV. EMERGENCIES
A. In the circumstances of declared national or state emergencies in which the healthcare community relies on Anda for critical medicines, medical supplies, products, and services, Anda may be required to temporarily modify its CSMP processes to meet the critical needs of the supply chain. These modifications may conflict with the requirements of the Injunctive Relief Terms.
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B. In the case of a declared national or state emergency, Anda shall be required to give notice to the State Compliance Review Committee of any temporary material changes to its CSMP processes which may conflict with the requirements of the Injunctive Relief Terms and specify the sections of the Injunctive Relief Terms which will be affected by the temporary change.
C. Anda shall document all temporary changes to their CSMP processes and appropriately document all customer-specific actions taken as a result of the declared national or state emergency.
D. Anda shall provide notice to the State Compliance Review Committee at the conclusion of the declared national or state emergency, or sooner, stating that the temporary CSMP processes put into place have been suspended.
E. Provided Anda complies with the provisions of Sections XV.A through XV.D, Anda will not face liability for any deviations from the requirements of the Injunctive Relief Terms taken in good faith to meet the critical needs of the supply chain in response to the declared national or state emergency. Nothing herein shall limit Settling States from pursuing claims against Anda based on deviations from the requirements of the Injunctive Relief Terms not taken in good faith to meet the critical needs of the supply chain in response to a declared national or state emergency.
XVI. COMPLIANCE WITH LAWS AND RECORDKEEPING
A. Anda acknowledge and agree that it must comply with applicable state and federal laws governing the distribution of Controlled Substances.
B. Good faith compliance with the Injunctive Relief Terms creates a presumption that Anda is acting reasonably and in the public interest with respect to Settling States’ existing laws requiring effective controls against diversion of Controlled Substances and with respect to the identification, reporting, and blocking of Suspicious Orders of Controlled Substances.
C. The requirements of the Injunctive Relief Terms are in addition to, and not in lieu of, any other requirements of state or federal law applicable to Controlled Substances distribution. Except as provided in Section XVI.D, nothing in the Injunctive Relief Terms shall be construed as relieving Anda of the obligation to comply with such laws, regulations, or rules. No provision of the Injunctive Relief Terms shall be deemed as permission for Anda to engage in any acts or practices prohibited by such laws, regulations, or rules.
D. In the event of a conflict between the requirements of the Injunctive Relief Terms and any other law, regulation, or requirement such that Anda cannot comply with the law without violating the Injunctive Relief Terms or being subject to adverse action, including fines and penalties, Anda shall document such conflicts and notify the State Compliance Review Committee and any affected Settling State the extent to which it will comply with the Injunctive Relief Terms in order to eliminate the conflict within thirty (30) days of Anda’s discovery of the conflict. Anda shall comply with the Injunctive Relief Terms to the fullest extent possible without violating the law.
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E. In the event of a change or modification of federal or state law governing the distribution of Controlled Substances that creates an actual or potential conflict with the Injunctive Relief Terms, Anda, any affected Settling State, or the State Compliance Review Committee may request that Anda, State Compliance Review Committee, and any affected Settling State meet and confer regarding the law change.
During the meet and confer, Anda, the State Compliance Review Committee, and any affected Settling State will address whether the change or modification in federal or state law requires an amendment to the Injunctive Relief Terms. In the event Anda, the State Compliance Review Committee, and any affected Settling State cannot agree on a resolution, and the dispute relates to whether the generally applicable Injunctive Relief Terms herein should be changed, Anda, the State Compliance Review Committee, or any affected Settling State may submit the question to the National Arbitration Panel. If the dispute relates to whether a change in an individual State’s law requires a modification of the Injunctive Relief Terms only with respect to that State, Anda, the State Compliance Review Committee, or any affected Settling State may seek resolution of the dispute pursuant to Section XIX. Maintenance of competition in the industry and the potential burden of inconsistent obligations on Anda shall be a relevant consideration in such resolution.
F. Recordkeeping: Anda shall retain records it is required to create pursuant to its obligations hereunder in an electronic or otherwise readily accessible format. The Settling States shall have the right to review records provided to the Monitor pursuant to Section XVIII. Nothing in the Injunctive Relief Terms prohibits a Settling State from issuing a lawful subpoena for records pursuant to an applicable law.
XVII. CLEARINGHOUSE
A. Starting ninety (90) days after the Effective Date, Anda shall participate in Phase 1 and Phase 2-A of the Clearinghouse.
B. Anda shall provide to the Clearinghouse and/or facilitate the Clearinghouse’s collection of the following:
1. Anda’s transaction data for Controlled Substances and non-Controlled Substances, specified at the NDC, date, quantity, and customer level.
2. Anda’s information on Customers that have been terminated and/or declined onboarding due to concerns regarding Controlled Substance dispensing following the Effective Date.
C. Anda shall comply with state and federal transactional and Suspicious Order reporting requirements related to Controlled Substances as follows:
1. Until such time as the Clearinghouse is able to provide transactional and Suspicious Order regulatory reporting to the states on behalf of Anda, Anda shall continue to file all required reports under state law and those reports required by these Injunctive Relief Terms.
2. Once the Clearinghouse is able to process and submit such reports, the Clearinghouse may process and submit those reports on behalf of Anda to Q-23
the states. At all times during Phase 1, Anda shall remain responsible for the identification of Suspicious Orders and will remain liable for a failure to submit transactional data or Suspicious Order reports required under state law or these Injunctive Relief Terms.
3. Anda may elect to fulfill its reporting obligations directly, rather than have the Clearinghouse assume the responsibility for the transmission of the various reports.
D. Anda shall receive information, analyses and reports from the Clearinghouse on the same basis as other distributors participating in Phase 1 and 2-A of the Clearinghouse.
1. Anda shall be permitted to use information obtained from the Clearinghouse for anti-diversion purposes, including the uses expressly contemplated by the Injunctive Relief Terms.
2. Anda shall ensure any data obtained from the Clearinghouse cannot be accessed by any of its parent’s business units, or their employees or agents, who are involved in manufacturing or marketing of pharmaceuticals or sales or distribution of pharmaceuticals they manufacture.
3. Anda shall not receive from the Clearinghouse information specific to another distributor. Notwithstanding the prior sentence, Anda may receive from the Clearinghouse blinded data reflecting total Orders (across all distributors) for a particular Customer, region, and/or state at the base code and NDC number level and all transactional data information.
4. Anda may use information it receives from the Clearinghouse only for the purposes of identifying, minimizing, or otherwise addressing the risk of Controlled Substances diversion. Anda shall not attempt to obtain revenue from this information.
5. Anda shall not sell (or obtain license fees for) data obtained from Clearinghouse to any third-parties. Nothing in the Injunctive Relief Terms shall prohibit Anda from using its own data, including data provided to Anda by third-parties other than the Clearinghouse, for any commercial purposes, including selling or licensing its data to third-parties.
E. Anda, in its sole discretion, may elect whether to participate in Phase 2-B of the Clearinghouse. CSMP functions that are assumed by the Clearinghouse during Phase 2-B will no longer be performed by Anda individually through its CSMPs. CSMP functions performed by the Clearinghouse during Phase 2-B will assist Anda to satisfy the applicable legal obligations of Anda. In the event that Anda elects not to participate in Phase 2-B, Anda shall have no obligation to implement the Clearinghouse’s determinations as to identification of Suspicious Orders and Suspicious Order reporting.
F. Liability Related to the Clearinghouse.
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1. Anda is entitled to rely upon information or data received from the Clearinghouse, whether in oral, written, or other form. Anda shall not have any liability (whether direct or indirect, in contract or tort or otherwise) to any party for or in connection with any action taken or not taken by the Clearinghouse. In addition, Anda shall not have any liability (whether direct or indirect, in contract or tort or otherwise) to any party for or in connection with any action taken or not taken by Anda based on incorrect, inaccurate, incomplete or otherwise erroneous information or data provided by the Clearinghouse, unless the information or data was incorrect, inaccurate, incomplete or otherwise erroneous because Anda itself provided incorrect, inaccurate, incomplete or otherwise erroneous data or information to the Clearinghouse.
2. Reports or analysis generated by the Clearinghouse may not be based on complete data due to a lack of participation by other distributors and pharmacies. As such, Anda shall not be held responsible for actions or inactions related to reports and analysis prepared by the Clearinghouse which may be based on incomplete data due to a lack of participation by other distributors and pharmacies.
3. Nothing in the Injunctive Relief Terms shall require Anda to indemnify or otherwise be responsible to pharmacy customers for any claims resulting from the provision of Dispensing Data to the Clearinghouse, including, but not limited to, claims related to any data breaches occurring with the data transmitted to or maintained by the Clearinghouse.
4. Anda and the Settling States shall not be liable for any breaches of any databases maintained by the Clearinghouse. This does not excuse the Clearinghouse or its vendor(s) from compliance with all state and federal laws and regulations governing (1) the protection of personal information and protected health information, or (2) notifications relating to Data Security Events.
5. The Clearinghouse’s performance of CSMP functions during Phase 2-B will not relieve Anda from its legal obligations unless (i) Anda and the State Compliance Review Committee jointly enter into a written agreement for the Clearinghouse to assume legal requirements during Phase 2-B; and (ii) all vendors and consultants working on the Clearinghouse agree in writing to assume such obligations.
G. Funding Obligations.
1. For a period of ten (10) years from the Effective Date, Anda will contribute to the cost of the operation of the Clearinghouse in an amount to be determined based on the financial and relative size of Anda compared to the three distributors initially participating in the Clearinghouse.
2. Anda shall engage with the three distributors initially participating in the Clearinghouse and the State Compliance Review Committee to determine Q-25
Anda’s required contribution. If Anda and the State Compliance Review Committee cannot reach an agreement on the amount of the contribution, the issue will be submitted to the National Arbitration Panel for resolution subject to the cap provided by Section XVII.G.4.
3. In the event that Anda elects not to participate in Phase 2-B, Anda shall have no obligation to fund future costs directly related to Phase 2-B of the Clearinghouse.
4. In no case shall Anda’s required contribution for Phase 1 and Phase 2-A during the first two (2) years of its participation in the Clearinghouse exceed $250,000 per year, nor shall it exceed $100,000 per year during its third through tenth years of participation.
5. Anda and the State Compliance Review Committee agree to engage in good faith discussions regarding potential continued operation and funding of the Clearinghouse following the initial ten (10) year period.
XVIII.MONITOR
A. Anda shall engage a Monitor to perform the reviews described in Section XVIII.G in a professionally independent and objective fashion. The Monitor shall employ or retain personnel who have appropriate qualifications related to the pharmaceutical industry and the laws governing the distribution of pharmaceuticals, the distribution of Controlled Substances, and the applicable requirements of federal and state law. The Monitor may also employ or retain personnel who have appropriate qualifications in the audit and review of sample documents in order to conduct the reviews described in Section XVIII.G. To the extent additional expertise is required for the engagement, the Monitor may retain the services of third-party consultants after consultation with and input from Anda and the State Compliance Review Committee.
B. The Monitor and any retained third-parties shall at all times act in good faith and with integrity and fairness towards all parties.
C. Monitor Selection and Engagement
1. The parties have agreed that the initial Monitor shall be Gil Soffer of Katten, Muchin Rosenman LLP.
2. The Monitor can be replaced upon agreement of the State Compliance Review Committee and Anda. If the parties so agree, the process for selecting a replacement Monitor shall be the process described in paragraphs i-iii below. The provisions of this Exhibit Qshall apply to any successor Monitor.
i. State Compliance Review Committee and Anda will each identify the names of up to three (3) individuals, groups of individuals or firms as the pool of recommended candidates to serve as the Monitor, within (60) calendar days of the date the parties agree to replace the Monitor.
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ii. The State Compliance Review Committee and Anda shall have the right to meet with and otherwise evaluate the candidates and conduct appropriate interviews of the personnel who are expected to work on the project. The following qualifications may be relevant considerations for the State Compliance Review Committee and Anda in evaluating candidates: (a) prior monitorship or oversight experience; (b) experience with applicable laws and regulations governing the distribution of Controlled Substances; (c) experience with the pharmaceutical; (d) access to sufficient resources to carry out the duties of the Monitor; and (e) experience with internal investigations or the investigative process. iii. If the State Compliance Review Committee and Anda do not agree on the appointment of any of the candidates from the initial pool of recommendations, State Compliance Review Committee and/or Anda may identify additional qualified candidates, as the timeline permits.
However, in the event the parties fail to reach agreement on a Monitor within ninety (90) calendar days of the date the parties agree to replace the monitor, the State Compliance Review Committee shall appoint a Monitor.
3. In the event that the State Compliance Review Committee and Anda do not agree to the dismissal of the Independent Monitor, either the State Compliance Review Committee (through one of the Settling States on the State Compliance Review Committee) or Anda may submit the question of the Monitor’s dismissal to the court to which the Consent Judgment was presented in any Settling States on the State Compliance Review Committee, and the Monitor shall only be dismissed if the court finds that there is Good Cause for dismissal. Good Cause for dismissal shall mean (a) a material and substantial breach of the terms of this Exhibit Q by the Monitor, including the failure to comply with the terms and limitations of this Exhibit Q; (b) any act of dishonesty, misappropriation, embezzlement, intentional fraud, or similar conduct by the Monitor; (c) any intentional act of bias or prejudice in favor or against either party by the Monitor; or (d) conduct by the Monitor that demonstrates unfitness to fulfill the functions of the Monitor reasonably and competently. Good Cause shall not include disagreements with the decisions of the Monitor pursuant to this Exhibit Q, unless there is a clear pattern in the Monitor’s decisions that demonstrates that the Independent Monitor has not been acting as an independent third party in rendering decisions.
4. Anda shall be responsible for the Monitor’s fees and costs directly related to its performance of the work specified by the Injunctive Relief Terms up to a limit of $300,000 per year. Should the Monitor require additional fees and costs to perform adequately the work specified in these Anda Injunctive Terms, the Monitor may request an increase in the budget to cover these unanticipated costs, and Anda will not unreasonably withhold approval of same. Further, to the extent there remains funds not yet expended under Teva’s monitor budget (Section VI.C. of Exhibit P of the Settlement Agreement), those may be used to cover these unanticipated costs at Teva’s discretion.
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D. Term and Reporting Periods
1. The term of the Monitor will be five (5) years from the date the Monitor is appointed, divided into one-year periods for purposes of the reviews and reporting described in Section XVIII (“Reporting Periods”). The Monitor may align Anda’s Reporting Periods with the reporting periods provided by the Big 3 Distributor Injunctive Relief Terms.
E. Monitor Access to Information
1. In connection with its reviews set forth in Section XVIII.G, the Monitor may request to interview employees with appropriate authority and responsibilities as necessary. In the event that Anda believes that the Monitor is requesting an unreasonable number of interviews or requesting interviews of employees who do not have relevant information to the reviews required by Section XVIII.G, Anda and State Compliance Review Committee shall meet and confer in good faith to resolve this issue.
2. The Chief Diversion Control Officer of Anda or a direct report of the Chief Diversion Control Officer shall serve as the primary point of contact for the Monitor to facilitate the Monitor’s access to documents, materials, or staff necessary to conduct the reviews specified in Section XVIII.G. The Monitor shall communicate any request for documents, materials, or access to staff to the Chief Diversion Control Officer or her designee.
3. If at any time the Monitor believes there is undue delay, resistance, interference, limitation, or denial of access to any records or to any employee or former employee deemed necessary by the Monitor to conduct the reviews specified in Section XVIII.G, the Monitor shall notify the Chief Diversion Control Officer of Anda and they shall meet and confer to resolve such issue.
If the Monitor believes that the matter was not resolved, the Monitor shall immediately report the issue to the State Compliance Review Committee.
4. To the extent any of the documents requested by the Monitor contain material protected from disclosure by any legal privilege, including the attorney-client privilege or attorney work product protections, Anda may redact such material before providing the documents to the Monitor, but must provide the Monitor with a privilege log describing the redacted information and identifying the basis for redaction.
5. Notwithstanding any other information referenced and produced pursuant to Section XVIII, the Monitor shall have access to, and Anda’s Chief Diversion Control Officer shall produce to the Monitor, any settlement agreements with government entities entered into after the Effective Date specifically concerning the requirements contained in the Injunctive Relief Terms and Anda’s distribution of Controlled Substances (as opposed to distribution of pharmaceutical products in general).
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F. Settling States’ Access to Monitor
1. Other than in connection with the initiation of a Notice of Potential Violation set forth in Section XIX.B.2, should the Monitor believe it needs to initiate communication with the State Compliance Review Committee regarding Anda’s compliance with the Injunctive Relief Terms, the Monitor’s communications should include the Chief Diversion Control Officer or counsel of Anda, regardless of the form of communication.
2. The State Compliance Review Committee shall have access to any settlement agreements produced to the Monitor pursuant to Section XVIII.E.5.
G. Reviews to be Conducted by the Monitor
1. There shall be two (2) types of reviews to be conducted by the Monitor:
a) Customer-specific reviews, as set forth in Section XVIII.G.2; and b) System reviews, as set forth in Section XVIII.G.3.
2. Customer-Specific Reviews
a) The following Customer-specific reviews will be conducted by the Monitor for each of the Reporting Periods:
(1) Threshold Change Request Review (“TCR Review”);
(2) Onboarding New Customer Review (“Onboarding Review”); (3) Ongoing Due Diligence Review (“Ongoing Diligence
Review”);
(4) Customer Termination Review (“Termination Review”); and (5) Orders that Exceed Thresholds but are Shipped Review (“Exceeded Threshold Review”).
b) Sample selection and audit periods for TCR Reviews, Onboarding Reviews, Ongoing Diligence Reviews, Termination Reviews, and Exceeded Threshold Reviews:
(1) For each Reporting Period, the Monitor will review a representative sample of files for the performance of the TCR Reviews, Onboarding Reviews, and Ongoing Diligence
Reviews. The Monitor shall select a sample representative of various geographic regions, customer types (Independent Retail Pharmacy Customers or Chain Customer), and
distribution centers.
(2) The Monitor will meet and confer with Anda to determine the appropriate audit period within each Reporting Period from which the samples will be selected (e.g. samples will be selected from the first six (6) months of a reporting period to Q-29
allow the Monitor time to perform its review during the remainder of the reporting period).
(3) Within thirty (30) calendar days following the close of the agreed-upon audit period, Anda (or the Clearinghouse once operational, if able to do so) will provide the Monitor with the following lists of relevant Customers for each type of review:
(a) A list of all Customers that requested at least one Threshold increase for a Highly Diverted Controlled
Substance during the relevant audit period, including
the number of such requests by each Customer;
(b) A list of all Customers that were onboarded during the relevant audit period and, during that period, ordered
and received Highly Diverted Controlled Substances;
(c) A list of all Customers that were the subject of an Ongoing Diligence Review during the relevant audit
period;
(d) A list of all Customers that, for reasons related to Controlled Substance regulatory compliance, were
terminated during the relevant audit period; and
(e) A list of all Orders for Highly Diverted Controlled Substances where a decision was made to ship the
Order even though the order exceeded the otherwise
applicable Threshold, with number of such shipped
orders.
(4) Within fifteen (15) calendar days of compiling this Customer information for sample selection, Anda shall propose a
reasonable number of customer files for each review to the Monitor.
(5) Within fifteen (15) calendar days of receiving the lists specified above from Anda, the Monitor shall choose
representative files to be reviewed from these lists. Each list will include the Customers’ zip code, geographic region, distribution center, and customer type (Independent Retail Pharmacy Customer or Chain Customer).
c) TCR Reviews
(1) For each Reporting Period, the Monitor shall conduct a TCR Review for a sample review of Customers who requested at least one Threshold increase for Highly Diverted Controlled Substances. For the TCR Reviews, the Monitor shall review the information contained in the files of the sample Customers Q-30
and determine whether the information reflects substantial compliance with the requirements of Section XII.C.3.
d) Onboarding Reviews
(1) For each Reporting Period, the Monitor shall conduct an Onboarding Review of a sample of Customers that were
onboarded during the applicable audit period and, during that period, ordered and received Highly Diverted Controlled Substances from Anda. For the Onboarding Reviews, the
Monitor shall review the information contained in the files of the sample Customers and determine whether the information reflects substantial compliance with the requirements of Section IX.
e) Ongoing Diligence Reviews
(1) For each Reporting Period, the Monitor shall conduct an Ongoing Diligence Review of a sample of Customers that were the subject of Anda’s Ongoing Diligence Review under
Section X during the relevant audit period. For the Ongoing Diligence Reviews, the Monitor shall review the information contained in the files of the sample of Customers and
determine whether the information reflects substantial
compliance with the requirements of Section X.
f) Termination Reviews
(1) For each Reporting Period, the Monitor shall conduct a review of a sample of Customers that were terminated by Anda during the audit period. For the Termination Reviews, the Monitor shall review the information contained in the files of the sample of Customers and determine whether the information reflects substantial compliance with the requirements of Section XIV.
g) Exceeded Threshold Review
(1) For each Reporting Period, the Monitor shall conduct a review of a sample of Orders for Highly Diverted Controlled
Substances where a decision was made by Anda to ship the Order even though the Order exceeded the applicable
Threshold. For the Exceeded Threshold Reviews, the Monitor shall review the information contained in the Customer files related to the Orders and determine whether the information reflects substantial compliance with the requirements of Section XIII.B.
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3. Annual System Reviews:
a) The following system reviews will be conducted by the Monitor for each of the Reporting Periods:
(1) CSMP Review;
(2) Threshold Setting Process Review;
(3) Suspicious Orders and Suspicious Order Report Review; (4) Compensation Review;
(5) Red Flag Review; and
(6) Review of CSMP Integration with Clearinghouse.
b) CSMP Review
(1) For each Reporting Period, the Monitor shall conduct a review of the following materials from Anda:
(a) Current CSMP policies and procedures;
(b) Organizational charts for the departments that are
relevant to the CSMP organization;
(c) Logs and/or summaries of any reports received on the “hot line” required by Section V.E and the action or
response of Anda to any such reports;
(d) Copies of the quarterly reports provided by the Chief Diversion Control Officer to the CSMP Committee as
required by Section IV.C;
(e) Copies of the quarterly reports provided by the CSMP Committee to senior management and the Board of
Directors as required by Section VI.C; and
(f) Copies of the materials used for the training required by Section VII and lists of the attendees of the training. c) Threshold Setting Process Review:
(1) For each Reporting Period, Anda or its outside consultants shall prepare a summary report describing how its Thresholdsetting methodology for Independent Retail Pharmacy Customers and Chain Customers complies with Section XII (the “Annual Threshold Analysis and Assessment Report”).
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(2) For each Reporting Period, the Monitor shall review the Annual Threshold Analysis and Assessment Report, determine whether the information reflects substantial compliance with the requirements of Section XII, and include any Observations and Recommendations, as defined in Section XVIII.H, in its annual Audit Report.
d) Suspicious Orders and Suspicious Order Reporting Review:
(1) For each Reporting Period, Anda will provide the Monitor with a report containing summary metrics for the Suspicious Orders that were reported to the DEA and the Settling States (the “Suspicious Order Metrics Report”). In the Suspicious Order Metrics Report, Anda will also provide summary metrics for Orders of Highly Diverted Controlled Substances that
exceeded a Threshold but were still shipped.
(2) For each Reporting Period, the Monitor shall review the Suspicious Order Metrics Report, determine whether the
information reflects substantial compliance with the
requirements of Section XIII, and include any Observations and Recommendations in its annual Audit Report.
e) Compensation Reviews:
(1) For each Reporting Period, the Monitor will review
compensation-related policy documents for sales personnel.
The Monitor shall analyze those documents and determine whether the compensation policies of Anda comply with the requirements contained in Section V.
f) Red Flags Review:
(1) For each Reporting Period, the Monitor shall review the Red Flags defined in Section VIII and their incorporation into Anda’s policies and procedures. The Monitor shall determine whether the information reflects substantial compliance with the requirements of Section VIII and include any Observations and Recommendations, as called for by Section VIII.C, about those definitions in its annual Audit Report.
(g) Review of CSMP Integration with the Clearinghouse:
(1) For each Reporting Period, Anda shall prepare a report summarizing the status of Anda’s CSMP integration with the operation of the Clearinghouse (“Clearinghouse Integration Report”). The Monitor shall review Anda’s Clearinghouse Integration Report, determine whether the information reflects substantial compliance with the requirements of Section XVII, Q-33
and include any Observations and Recommendations in its annual Audit Report.
H. Observations and Recommendations:
1. If the Monitor notes any areas for potential improvement during the course of the reviews conducted pursuant to the Injunctive Relief Terms, the Monitor shall include any such recommendations in the Audit Report.
Collectively, any such questions, concerns or recommendations will be referred to as “Observations and Recommendations.”
I. Audit Reports:
1. No later than one hundred and twenty (120) calendar days prior to the end of a Reporting Period and/or at any other time deemed reasonably necessary by the Monitor, the Monitor shall provide Anda with a draft report detailing any instances of substantial noncompliance with the applicable provisions of the Injunctive Relief Terms from the reviews in Section XVIII.G (the “Draft Report”). The Draft Report will also describe any Observations and Recommendations.
2. Within thirty (30) calendar days of its receipt of the Draft Report, Anda will provide comments and responses to the Draft Report. Anda will, among other things:
a) Respond to each instance of substantial non-compliance, including, where appropriate, describing any corrective action taken (or to be taken).
b) Respond to each Observation and Recommendation.
3. Within thirty (30) calendar days of its receipt of Anda’s responses to the Draft Report, the Monitor shall provide a final report (the “Audit Report”) to Anda and the State Compliance Review Committee. The Monitor shall provide the State Compliance Review Committee with a copy of Anda’s response to the Draft Report.
4. No action or lack of action by the Settling States regarding information received from the Monitor concerning Anda’s conduct shall be considered affirmation, acceptance, or ratification of that conduct by the Settling States.
J. Confidentiality:
1. Materials and information provided by Anda to the Monitor that are designated “Confidential” (and any parts, portions, or derivations thereof) (the “Confidential Information”) will be kept confidential and not be shown, disclosed, or distributed to any other party, including any other distributor.
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2. The Monitor will not use materials or information received from Anda, or information or analysis developed using the Confidential Information of Anda, in its assessment of any other distributor. Because Anda operates pursuant to its own unique policies and procedures intended to comply with legal and other requirements of the Injunctive Relief Terms, the Monitor shall apply the standards of Anda to its reviews without preference to the practices or standards applied by any other distributor.
3. If any of the Settling States or the Monitor receive a request for disclosure of any material or information created or shared under the Injunctive Relief Terms, pursuant to a Third Party Request, the Settling State or the Monitor, respectively, shall notify Anda of the Third Party Request and the Confidential Information to be disclosed so that Anda may seek a protective order or otherwise challenge or object to the disclosure. The Settling State or the Monitor will provide Anda with at least ten (10) days’ advance notice before complying with any Third Party Request for Confidential Information, except where state law requires a lesser period of advance notice.
4. Nothing herein will be deemed to prevent any party from claiming any applicable exemption to the public information act, freedom of information act, public records act, or similar law.
XIX. ENFORCEMENT OF INJUNCTIVE RELIEF TERMS
A. State Compliance Review Committee:
1. Any Settling State may initiate a review of a Potential Violation consistent with the process set forth in Section XIX.
2. The State Compliance Review Committee shall assign the Monitor the responsibilities set forth in Sections XIX.B.3 through XIX.B.7, regarding review of a Potential Violation and an opportunity to cure, except with respect to matters requiring interpretation of the Injunctive Relief Terms subject to Section XIX.C.2. The objective of the Monitor shall be to facilitate a resolution among the parties, providing an opportunity to cure, as applicable, for the party against whom a Potential Violation has been alleged.
3. No less than six (6) months before the Monitor’s term expires pursuant to Section XVIII, the State Compliance Review Committee and Anda shall meet and confer in good faith to determine the parameters and processes for continued enforcement, consistent to the maximum extent possible with the provisions set forth in Section XIX, for the period after the Monitor’s term has ended. Absent agreement between the State Compliance Review Committee and Anda, all provisions set forth in Section XIX involving the Monitor are excused after the Monitor’s term has ended.
4. Should Anda allege in good faith that a Settling State or the Monitor has impaired the ability of Anda to meet the Injunctive Relief Terms, Anda may Q-35
request the State Compliance Review Committee to mediate any dispute in an effort to avoid the time and expense of litigation regarding interpretation and enforcement of the Injunctive Relief Terms.
B. Process for Review of Potential Violations and Opportunity to Cure:
1. Definition of “Potential Violation”: A Potential Violation occurs when Anda is alleged to not be in substantial compliance with (i) the Injunctive Relief Terms or (ii) a Corrective Action Plan adopted consistent with the process set forth in Section XIX.B.7.
2. Submission of Notice of Potential Violation. An allegation of a Potential Violation shall be submitted to the State Compliance Review Committee in writing by one or more Settling States (“Notice of Potential Violation” or “Notice”) and shall include the following to the extent practicable:
a) Specification of the particular Injunctive Relief Term(s) and/or Corrective Action Plan(s) implicated by the Potential Violation; b) Description of the Potential Violation with specificity; c) The reasoning for and, if available, any documentation supporting the allegation that a Potential Violation has occurred, including whether the Potential Violation is a matter identified by the Monitor in an Audit Report; and
d) Description of the time-sensitivity of the Potential Violation, if relevant.
3. Assignment to Monitor. The State Compliance Review Committee shall review every Notice. If the State Compliance Review Committee reasonably believes that further review is warranted, the State Compliance Review Committee shall forward the Notice to the Monitor. The Monitor shall ensure that Anda receives a copy of the Notice and a proposed schedule consistent with the process set forth in Sections XIX.B.4 and XIX.B.
4. Response to Notice of Potential Violation. Within thirty (30) days of receipt of the Notice of Potential Violation, Anda shall provide a written response to the referring Settling State(s), the Monitor, and the State Compliance Review Committee (collectively with Anda, the “parties to the Notice”)”. The response (a) shall set forth the reasons Anda believes that it is in substantial compliance with the relevant Injunctive Relief Term(s) and/or Corrective Action Plan(s), and (b) as applicable, shall explain efforts undertaken to cure the Potential Violation and a schedule for completing the efforts to cure.
5. Conference for Parties re Notice of Potential Violation. The parties to the Notice shall meet or otherwise confer regarding the Potential Violation. The parties and the Monitor shall make themselves available for such a meeting (which may at any party’s election be a virtual or technology-based Q-36
meeting), provided, however, that the meeting is not required to take place sooner than fifteen (15) days after a written response to the Notice of Potential Violation.
6. Process for Previously-Submitted Notices of Potential Violation. At the request of the parties to a Notice, the Monitor shall determine whether the Notice implicates the same or similar issues as a previously submitted Notice involving Anda or is a matter previously identified by the Monitor in an Audit Report involving Anda, and make an initial determination as to whether the issues needs to be addressed anew. The Monitor shall inform the Settling State and Anda of its determination within five (5) business days of receipt of the Notice. The Settling State and Anda shall have five (5) business days to object to the determination. If an objection is made, the Monitor shall respond to the objection within five (5) business days. If no objection is made, the party involved in the prior Notice may rely on the response to the previously submitted Notice or matter previously identified by the Monitor in an Audit Report and no further action shall be required.
7. Monitor Resolution of Potential Violation and Opportunity to Cure. Within thirty (30) days of the meeting pursuant to Section XIX.B.5, the Monitor, taking into consideration the submissions of the parties involved in the Notice and other information available to the Monitor, shall resolve the Notice as follows:
a) If the Monitor reasonably believes that a Potential Violation is not ongoing or has been substantially resolved as of thirty (30) days from the meeting pursuant to Section XIX.B.5, the Monitor shall provide written notice to the State Compliance Review Committee and the Settling State(s) and Anda.
b) If the Monitor reasonably believes that a Potential Violation is ongoing and has not been substantially resolved as of thirty (30) days from the meeting pursuant to Section XIX.B.5, the Monitor shall provide written notice to the State Compliance Review Committee and the Settling State(s) and Anda and request that Anda prepare, within thirty (30) days of the receipt of such written notice, a Corrective Action Plan to remedy such Potential Violation, including a reasonable period for implementation of such plan. The Monitor may extend the period of time to submit a Corrective Action Plan up to ninety (90) days based on a reasonable request by the affected party.
c) A Corrective Action Plan may address multiple Potential Violations, and an existing Corrective Action Plan may be amended to address additional Potential Violations.
d) Within ten (10) business days of submission of a Corrective Action Plan regarding a Potential Violation, the Monitor shall confer with Q-37
the State Compliance Review Committee and the Settling State(s) and Anda regarding the proposed Corrective Action Plan. The Monitor may recommend revisions in its discretion. The conference required by this paragraph may at any party’s election be a virtual or technology-based meeting.
(e) Within thirty (30) days of the conference in Section XIX.B.7.d, the Monitor shall advise the State Compliance Review Committee and the Settling State(s) and Anda whether the Monitor has adopted the proposed Corrective Action Plan or whether the Monitor has adopted it after making modifications. The Monitor shall also set forth a reasonable period for implementation of any such plan that has been adopted. Anda must begin to comply with the Corrective Action Plan within five (5) business days of receiving notice of the Corrective Action Plan has been adopted, unless it seeks review by the State Compliance Review Committee pursuant to Section XIX.C.1.
C. Enforcement Responsibilities of State Compliance Review Committee:
1. The Settling State(s) or Anda may request the State Compliance Review Committee to review the resolution (including a resolution pursuant to Section XIX.B.7.a) and/or Corrective Action Plan adopted by the Monitor regarding that Notice. Any such request must be made within five (5) business days of a resolution or adoption of a Corrective Action Plan by the Monitor.
The State Compliance Review Committee, taking into consideration the resolution by the Monitor, submissions of the Settling State(s) or Anda, and other information available to the Committee, shall within thirty (30) days of receipt of the request resolve the matter by written notice to the affected parties, which shall include the State Compliance Review Committee’s reasoning in reaching its resolution. The State Compliance Review Committee may agree, disagree, or modify any resolution or Corrective Action Plan that it reviews. If the Corrective Action Plan is affirmed or affirmed as amended by the State Compliance Review Committee, Anda must within five (5) business days begin to comply with the Corrective Action Plan.
2. The State Compliance Review Committee shall review any issues raised by a Notice regarding the interpretation of the Injunctive Relief Terms at the request of the Settling State(s), Anda, or the Monitor. Such a request may be made at any time after the Notice’s submission, and the request will not extend the timelines set forth in Sections XIX.B and XIX.C.1. The State Compliance Review Committee shall notify the Monitor, Settling State(s) and Anda of its determination. Settling States and Anda do not waive their rights to challenge the interpretation of the Injunctive Relief Terms by the State Compliance Review Committee in any subsequent proceeding pursuant to Section XIX.E.2.
3. The State Compliance Review Committee may, independent of a Notice of Potential Violation, review requests by a Monitor, Settling State, or Anda regarding the interpretation of the Injunctive Relief Terms. The State Q-38
Compliance Review Committee shall notify the Monitor and requesting party of its interpretation, including the State Compliance Review Committee’s reasoning in reaching its conclusion. Settling States and Anda do not waive their rights to challenge the interpretation of the Injunctive Relief Terms by the State Compliance Review Committee in any subsequent proceeding pursuant to Section XIX.E.2.
4. The State Compliance Review Committee shall make available to all Settling States and Anda any interpretation it issues pursuant to Sections XIX.C.2 and XIX.C.3.
D. Composition of State Compliance Review Committee:
1. A Settling State on the State Compliance Review Committee that is in active litigation with Anda, or in another potential conflict of interest involving compliance with Controlled Substances laws and regulations, may not serve on the State Compliance Review Committee, and the remaining Settling States on the State Compliance Review Committee shall within five (5) business days select an alternate Settling State as a replacement.
2. If the affected state on the State Compliance Review Committee disputes that it has a disqualifying active litigation or other conflict of interest, the determination of whether that state has a conflict disqualifying it from serving on the State Compliance Review Committee shall be made by the remaining states on the State Compliance Review Committee.
E. Enforcement Actions:
1. Any written notice or resolution by the State Compliance Review Committee regarding the matters set forth in Sections XIX.B and XIX.C shall provide the State Compliance Review Committee’s assessment of the matter but will not be an official opinion of any individual Settling State.
2. Following the issuance of a written notice or resolution of the State Compliance Review Committee pursuant to Section XIX.C, a Settling State or Anda may take whatever action it deems necessary related to the written notice or resolution issued by the State Compliance Review Committee, provided that the Settling State or Anda is either (a) the Settling State that sought review by the State Compliance Review Committee, or (b) Anda.
Such action may include but is not limited to bringing an action to enforce the settlement agreement, filing a new original action, or, the parties to a Notice attempting to negotiate a Corrective Action Plan directly with each other.
3. The Settling States agree that prior to taking any court or administrative action, other than an action that is necessary to address an immediate threat to the health, safety, or welfare of the citizens of the Settling State, or that a public emergency requiring immediate action exists, it will follow the process outlined in Sections XIX.B and XIX.C.
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4. A Settling State or Anda must bring a court or administrative action within six (6) months of any resolution of the State Compliance Review Committee, unless the alleged violation is also an independent violation of state or federal law, or an action that a Settling State concludes is necessary to address an immediate threat to the health, safety, or welfare of the citizens of the State, or that a public emergency requiring immediate action exists, in which cases, the applicable statute of limitations (if any) for sovereign actions shall apply.
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Exhibit R
Agreement on Attorneys’ Fees, Expenses and Costs
This Agreement on Attorneys’ Fees, Expenses, and Costs (“Fee Agreement”) is entered between Teva, Allergan, and the Plaintiffs’ Executive Committee appointed in the multidistrict litigation in the Northern District of Ohio, In re National Prescription Opiate Litigation, No. 1:17- MD-2804 (“MDL PEC”), in connection with the Teva Global Opioid Settlement Agreement (“Teva Agreement”) and the Allergan Public Global Opioid Settlement Agreement (“Allergan Agreement”).
This Fee Agreement becomes effective on the Effective Date of the Teva Agreement and Allergan Agreement or the date that the Consent Judgments anticipated under the Teva Agreement and Allergan Agreement become final in 25 Settling States (whichever is later).
I. Definitions
A. This Fee Agreement incorporates all defined terms in the Teva Agreement and Allergan Agreement, unless otherwise defined herein, and shall be interpreted in a manner consistent with the Teva Agreement and Allergan Agreement.
B. “Allergan.” Allergan Finance, LLC (f/k/a Actavis, Inc., which, in turn, was f/k/a/ Watson Pharmaceuticals, Inc.) and Allergan Limited (f/k/a Allergan plc, which, in turn, was f/k/a Actavis plc). Allergan does not include Teva Pharmaceuticals Industries Ltd. (“Teva Ltd.”), Teva Pharmaceuticals USA, Inc. (“Teva USA”), Cephalon, Inc. (“Cephalon”), Actavis LLC (f/k/a Actavis Inc.) (“Actavis LLC”), Watson Laboratories, Inc. (“Watson”), Actavis Pharma, Inc. (f/k/a Watson Pharma, Inc.) (“Actavis Pharma”), Actavis Elizabeth LLC (“Actavis Elizabeth”), Actavis Kadian LLC (“Actavis Kadian”), Actavis Laboratories FL, Inc. (f/k/a Watson Laboratories, Inc. - Florida) (“Actavis Labs FL”), Actavis Laboratories UT, Inc. (f/k/a Watson Laboratories, Inc. - Utah) (“Actavis Labs UT”), Actavis Mid Atlantic LLC (“Actavis Mid”), Actavis South Atlantic LLC (“Actavis South”), Actavis Totowa LLC (“Actavis Totowa”), or Anda, Inc. (“Anda”).
C. “Applicant.” Any Attorney or MDL Participating Counsel who seeks an award of attorneys’ fees from the Attorney Fee Fund pursuant to the procedures established by the MDL Court and the Fee Panel.
D. “Attorney.” Any of the following retained through a legal contingency fee or hourly fee contract: a solo practitioner, multi-attorney law firm, or other legal representative of a Participating Subdivision or MDL Participating Counsel. This does not include Subdivision in-house attorneys.
E. “Attorney Fee Fund.” An account consisting of funds allocated to pay attorneys’ fees approved pursuant to Section III of this Fee Agreement established by Order of and under the ongoing jurisdiction of the MDL Court, as provided below.
F. “Common Benefit.” Work performed for the benefit of all Participating Subdivisions or Tribal Nations, including, but not limited to, pretrial matters, discovery, trial preparation, trial, settlement negotiations, and all other work that advances the interests of the Participating Subdivisions.
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G. “Common Benefit Fund.” The sub fund of the Attorney Fee Fund described in subsection III.E.
H. “Contingency Fee Fund.” The sub fund of the Attorney Fee Fund described in subsection III.F.
I. “Cost and Expense Fund Administrator.” The administrator appointed by the MDL Court on August 12, 2021 (MDL Docket No. 3828), to administer the Cost Fund and its sub funds as provided in the Fee Agreement.
J. “Court Common Benefit Fund.” The Common Benefit Fund established by the MDL Court in its orders of July 22, 2021, MDL Docket No. 3794, and May 9, 2022, MDL Docket No. 4428.
K. “Fee Entitlement.” Any right, entitlement, or expectation, including but not limited to a fee contract, contingent fee contract, agreement, referral arrangement, co-counsel arrangement, State Back-Stop agreement, or any other arrangement by which counsel could receive compensation or other consideration. For the avoidance of doubt, the scope of Fee Entitlement under subparagraph III.G.3.a does not include any Attorneys’ fees associated with representation of a State.
L. “Fee Panel.” The three-person panel appointed by the MDL Court on August 12, 2021 (MDL Docket No. 3828), to administer and make recommendations for the allocation and distribution of the Attorney Fee Fund and its sub funds as provided in the Fee Agreement.
M. “Later Litigating State” means a State that first files a lawsuit bringing a Released Claim against a Released Entity after the Preliminary Agreement Date.
N. “MDL Court.” United States District Court for the Northern District of Ohio Eastern Division, Case No. 1:17-md-2804, Judge Dan Aaron Polster.
O. “MDL Direct Cost Fund.” The cost fund described in subparagraph II.A.3.a below.
P. “MDL Participating Counsel.” MDL Participating Counsel includes an attorney or firm authorized by MDL 2804 Lead Counsel to perform work for the Common Benefit of Participating Subdivisions. By way of example, it would include insurance counsel and appellant counsel.
Q. “MDL PEC.” The Plaintiffs’ Executive Committee appointed by the MDL Court.
R. “Non-Participating Litigating Subdivision.” A Litigating Subdivision that is not a Participating Subdivision.
S. “Non-Participating State.” A State that is not a Participating State.
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T. “Participating Litigating Subdivision.” A Litigating Subdivision that is also a Participating Subdivision.
U. “Participation Agreement.” An agreement executed by an Attorney that acknowledges the obligation to pay an appropriate MDL Common Benefit Assessment.
V. “Qualified Tribal Representation.” Representation by an attorney of a Participating Tribal Government regarding Released Claims against Released Entities. Such counsel are eligible for Common Benefit Fee consideration. The Teva Tribal Global Settlement and the Allergan Tribal Global Settlement will provide for the contribution to the Common Benefit Fund as determined by the MDL Court.
W. “Qualifying Representation.” Legal services provided for representation of the MDL PEC or Participating Litigating Subdivision regarding Released Claims against Released Entities.
X. “State Back-Stop Agreement.” Any agreement by a Settling State and private counsel for Participating Subdivisions in that State (or legislation enacted in that State) to provide, adjust, or guarantee attorneys’ fees and costs, whether from the Attorney Fee Fund or any other source recognized in the agreement or legislation.1 Y. “Subdivision Cost and Expense Fund.” The fund created to pay approved Subdivision and Tribal Nations costs and expenses as set forth in subparagraph II.A.3.b.
Z. “Teva” means (i) Teva Pharmaceutical Industries Ltd. and (ii) 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., the Actavis Generic Entities, and Anda Inc.
II. MDL Direct Cost Fund and Subdivision Cost and Expense Fund (“Cost Fund”) A. The total Cost Fund shall be $30 million dollars funded as set forth below.
1. Total cost to be paid by Teva in each of the relevant Payment Years2under this Agreement shall be up to the following amounts, subject to the provisions set forth below:
1 Nothing herein shall be understood to indicate approval for additional State Back-Stop Agreements or modifications of existing State Back-Stop Agreements.
2 Payment Year shall have the same meaning for Teva as set forth in the Teva Agreement and Teva Exhibits M-1 and M-3. Payment Year shall carry the same definition for Allergan as set forth in the Allergan Agreement and Allergan Exhibits M-1 and M-2.
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Cost Fund
Payment
Year 1 $9,000,000.00
Payment
Year 2 $9,000,000.00
2. Total cost to be paid by Allergan in each of the relevant Payment Years under this Agreement shall be up to the following amounts, subject to the provisions set forth below:
Cost Fund
Payment
Year 1 $6,000,000.00
Payment
Year 2 $6,000,000.00
3. The Cost Fund shall be split into the MDL Direct Cost Fund and the Subdivision Cost and Expense Fund.
a. The MDL Direct Cost Fund shall be Seven Million Five Hundred Thousand Dollars ($7,500,000), payable 50% in Year One, and 50% in Year Two. The MDL Direct Cost Fund shall make payment without any delay to reimburse the MDL PEC for an agreed-to portion of the expenses incurred, provided the costs have been approved by the Cost and Expense Fund Administrator appointed by the Court. The MDL Direct Cost Fund will be paid directly to the MDL Opiate Capital Account. The Cost and Expense Fund Administrator may include costs incurred by the MDL PEC in furtherance of litigation, mediation, implementation, and management of the Settlements.
b. The Subdivision Cost and Expense Fund shall be Twenty-Two Million Five Hundred Thousand Dollars ($22,500,000), payable 50% in Year One and 50% in Year Two.
c. It is the intention of the Parties that the Cost Fund shall be administered by the Cost Fund and Expense Fund Administrator (MDL Docket No. 3828), who will be governed by the provisions of this Agreement and shall design the process and procedures for the allocation of costs pursuant to this Agreement and the MDL Court’s Order.
d. The costs of the Cost and Expense Fund Administrator shall be paid from the Cost Fund and allocated by the Cost and Expense Fund Administrator between the MDL Direct Cost Fund and the Subdivision Cost and Expense Fund to fairly charge each fund the cost incurred in implementing and supervising the specific fund.
e. The Cost and Expense Fund Administrator shall set the process and procedures for submission of and criteria for applications for payment of R-5
Subdivisions’ and Tribal Nations’ costs and expenses. The Cost and Expense Fund Administrator shall receive and evaluate applications from Participating Litigating Subdivisions and litigating Tribal Nations, whether filed in Federal Court or State Court, to seek reimbursement for eligible costs in pursuit of claims against Allergan or Teva. The process shall require a showing that the costs or expenses sought were reasonably incurred in furtherance of active litigation of a designated state or federal bellwether trial-set case, or Common Benefit. The Cost and Expense Fund Administrator shall require transparency from all applicants as to any other sources for compensating Attorneys for Subdivisions and Tribal Nations for costs incurred. If funds remain after the reimbursement of approved out-of-pocket costs, the Cost and Expense Fund Administrator may consider reasonable and appropriate payment for client time, costs, or expenses incurred by recognized trial bellwether plaintiffs. At the conclusion of the process, any funds not allocated by the Cost and Expense Fund Administrator shall be transferred to the Common Benefit Fund established in this Exhibit R.
4. In the event that States and Subdivisions enter into an additional global settlement with a party or parties other than Teva or Allergan that is (a) under the jurisdiction of the MDL Court in MDL No. 2804, (b) creates a separate cost fund, and (c) unless the parties agree to another date, such agreement has an effective date prior to June 30, 2023, the Cost and Expense Fund Administrator shall have the authority to aggregate the Cost Fund with the cost fund created under that global settlement agreement. The Cost and Expense Fund Administrator shall have the authority to address the appropriate procedures and required information to allow the costs to be funded from the appropriate cost fund or shared by two or more cost funds.
III. Attorney Fee Fund
A. An Attorney Fee Fund shall be paid in the following amounts and years:
Teva Shall Pay Allergan Shall Pay
Payment
Year 1 $ 46,215,837.93 $ 40,778,855.53
Payment
Year 2 $ 46,215,837.93 $ 40,778,855.53
Payment
Year 3 $ 55,215,837.92 $ 46,778,855.53
Payment
Year 4 $ 55,215,837.92 $ 46,778,855.53
Payment
Year 5 $ 55,215,837.92 $ 0.00
Payment
Year 6 $ 55,215,837.92 $ 0.00
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B. The Attorney Fee Fund shall consist of the Contingency Fee Fund and the Common Benefit Fund.
1. It is the intention of the Parties that the Contingency Fee Fund and the Common Benefit Fund shall be administered by the Fee Panel (MDL Docket No. 3828), which will be governed by the provisions of this Fee Agreement and shall design the process and procedures for the allocation of fees pursuant to this Fee Agreement and the MDL Court’s Order.
C. The fees to be paid under this Fee Agreement are available for Attorneys engaged in Qualifying Representations and Qualified Tribal Representations only. Fees to be paid under this Fee Agreement are not available prior to the Effective Date of the Teva Agreement and Allergan Agreement or if the Teva Agreement does not proceed past Teva’s determination in subsection XI.A of the Teva Agreement or if the Allergan Agreement does not proceed past Allergan’s determination in subsection X.A of the Allergan Agreement. Fees to be paid under this Fee Agreement are not available for representation of States, Non-Participating Subdivisions or NonLitigating Subdivisions and are not available for representation of private hospitals, third-party payors, NAS claimants, personal injury/wrongful death claimants, or any entity other than Participating Litigating Subdivisions. In addition, fees under this Fee Agreement are not available for representation of any individual or entity in matters other than those claims against Released Entities, but may include a reasonable share of representations that involve development of facts for pursuit of opioid-related claims against multiple defendants in the pharmacy, manufacturing, and distribution chain.
D. Attorney Fee Fund and Sub Funds.
1. There shall be a split of the Attorney Fee Fund into the Contingency Fee Fund and the Common Benefit Fund. The split shall be 40% to the Contingency Fee Fund and 60% to the Common Benefit Fund.
2. In no event shall Teva or Allergan be required to pay more into the Attorney Fee Fund in any Payment Year than the maximum amount specified for that Payment Year in subsection III.A., which amounts are reflected in Exhibit M to the Teva Agreement and Allergan Agreement. The amounts allocated to the Contingency Fee Fund and the Common Benefit Fund set by the Fee Panel shall be subject to the reductions and offsets set forth below.
3. Awards of fees from the Contingency Fee Fund shall be available to Attorneys with Qualifying Representations of Participating Litigating Subdivisions eligible to receive an allocation under the Teva Agreement and Allergan Agreement, as set forth in Exhibits F-2 and G to the Teva Agreement and Exhibits F and G to the Allergan Agreement, and shall be made applying the Mathematical Model attached as Exhibit “A” to this Fee Agreement. The collection of the data and calculations for the Mathematical Model has been a cooperative effort among private counsel for a large number of Litigating Subdivisions. The analysis has been spearheaded by Joseph Tann and Andrew Arnold. The Fee Panel is R-7
encouraged to continue working with those counsel in application of the Model.
The Fee Panel shall oversee the application of the Model and resolve any questions or disputes concerning the eligibility of a Counsel to participate as required in subsection III.G. The Panel is empowered to hear disputes concerning and ensure the accuracy of the mathematical calculation.
4. As to awards from the Contingency Fee Fund, there shall be no right of appeal.
5. Any appeal of an award of the Fee Panel from the Common Benefit Fund will be made to the MDL Court and be reviewed under an abuse of discretion standard.
E. Common Benefit Fund (60% of the Attorney Fee Fund).
1. Funds in the Attorney Fee Fund shall be allocated to the Common Benefit Fund according to the schedule set forth below, subject to the adjustments described in paragraph III.E.6. The payments are to be made on the following yearly schedule, subject to the adjustments set forth below:
Teva Shall Pay Allergan Shall Pay
Payment
Year 1 $ 27,729,502.76 $ 24,467,313.32
Payment
Year 2 $ 27,729,502.76 $ 24,467,313.32
Payment
Year 3 $ 33,129,502.75 $ 28,067,313.32
Payment
Year 4 $ 33,129,502.75 $ 28,067,313.32
Payment
Year 5 $ 33,129,502.75 $ 0.00
Payment
Year 6 $ 33,129,502.75 $ 0.00
2. The Common Benefit Fund shall be available to compensate Attorneys engaged in Qualifying Representations of Participating Litigating Subdivisions and Qualified Tribal Representation of Tribal Participating Governments who:
a. have performed work for the Common Benefit of all Participating Subdivisions and/or Tribal Nations consistent with the provisions to the guidelines established by Judge Polster set forth in MDL 2804 and the May 1, 2018 Order, under docket number 358, which is incorporated herein by reference; and
b. satisfy the eligibility criteria set forth in subsection III.G.
3. For purposes of Common Benefit Fund distribution, Attorneys representing Tribal Nations litigating against Teva or Allergan have also reached a settlement for Released Claims with Teva and Allergan. These settlements shall be the subject of separate agreements with Teva and Allergan. Attorneys representing R-8
Tribal Nations are eligible for Common Benefit consideration, provided such agreements with Teva and Allergan became effective under their terms. Such Attorneys must meet the eligibility criteria in subsection III.G.
4. For purposes of Common Benefit Fund distribution, MDL Participating Counsel not engaged in Qualifying Representations of Participating Litigating Subdivisions but who performed work for the Common Benefit pursuant to authorization from the MDL Co-Leads and meet the eligibility criteria in subsection III.G shall be eligible.
5. The Common Benefit Fund shall be overseen by the Fee Panel, which shall determine the allocation of funds to eligible Attorneys consistent with this Fee Agreement and the May 1, 2018 Order.
6. In assessing the benefits that an Applicant has conferred to Participating Subdivisions (including non-Litigating Subdivisions) and/or Tribes for purposes of any compensation decision, the Fee Panel shall give significant weight to the extent to which (i) the Applicant and his or her clients have contributed to increasing (or reducing) the Initial Participation in the Teva Agreement or the Allergan Agreement, and (ii) the Applicant and his or her clients have contributed to increasing (or reducing) the amounts achieved under Incentive Payments A-D through participation in the Teva Agreement, including the Teva Tribal Agreement, or the Allergan Agreement, including the Allergan Tribal Agreement. The Fee Panel shall also consider additional fee recoveries the Applicant may potentially obtain, including, but not limited to, from attorney fee funds under other settlement agreements, State Back-Stop Agreements, representations of States or Tribal Nations, representations of other clients in opioids-related matters, or through the representation of Subdivision clients, whether they participated in the Teva Agreement or Allergan Agreement or not.
It is the intent of this provision to recognize that the goal of the Teva Agreement and Allergan Agreement is to provide for maximum participation by the Subdivisions, maximum abatement funding for all Subdivisions nationally, and the maximum peace for Released Entities. Therefore, representing one or more Non-Participating States or Non-Participating Subdivisions does not further the goal of the Teva Agreement or Allergan Agreement, and should not be considered Common Benefit because it does not increase funds available to Participating Subdivisions’ abatement programs. Representing one or more Later Litigating States or Later Litigating Subdivisions is antithetical to the Teva Settlement and the Allergan Agreement and detracts from Common Benefit. The Fee Panel shall consider this concept of “common detriment” set forth in this paragraph in all of its decision making with respect to the allocation of the Attorney Fee Fund among Applicants, as well as, in its discretion, any offsets provided to Teva or Allergan as set forth in subsection III.H. The Fee Panel shall consider the totality of the Applicant’s Participating Litigating Subdivisions as compared to the Applicant’s Non-Participating Litigating Subdivisions; the Parties recognize that, although the goal is for 100% participation, Applicants with a greater number of clients have a greater probability of having one or more Non-Participating Litigating Subdivisions. As used in this paragraph, “client” or R-9
“representing” a Subdivision shall include any Litigating Subdivision as to which the Applicant has a Fee Entitlement.
7. As set forth in subsection III.H, the Fee Panel must consider the factors described in paragraph III.E.6 to determine how and whether to reduce the amounts to be paid by Teva or Allergan under this Fee Agreement and to determine how to allocate funds among Applicants. They may also, at their discretion, consider other factors. Any reduction in payment obligation or credit to be given Teva or Allergan in this Fee Agreement shall be applied against the last Payment Year for that defendant and working backwards. Any reduction to an Applicant not credited to Teva or Allergan shall be allocated to attorneys whose Litigating Subdivision clients participated in the settlement by the Initial Participation Date.
8. The MDL PEC will seek, and the Attorneys General for Settling States, Teva, and Allergan, will not oppose, a Common Benefit Fee Order requiring an assessment of 7.5% on the gross recovery (by judgment or settlement) of any Non-Participating Subdivision that is subject to the federal court jurisdiction, represented by a MDL PEC firm, represented by any Attorney receiving fees from the Common Benefit Fund, represented by any Attorney that signed a Participation Agreement or paid in a case otherwise under the jurisdiction of the MDL Court.
9. If Teva and Allergan agree to go forward with their respective Agreements under subsections XI.A and X.A of their Agreements, they shall pay the full Common Benefit (60%) Fee into the Common Benefit Fund without regard to the number of Settling States or Participating Subdivisions. Should Teva and/or Allergan pay a judgment to, or settle with, a Non-Participating State or a Non-Participating Litigating Subdivision subsequent to the Reference Date, and such settlement or judgment results in a common benefit fee assessment paid into the Common Benefit Fund or the Court Common Benefit Fund, the following shall apply:
a. Teva or Allergan shall be credited dollar-for-dollar for the amount paid for the fee assessment up to 7.5% of the abatement amount derived from the application of the State Global Allocation Percentage as set forth in Exhibit F-1 or the abatement amount derived from the application of the Subdivision and Special District Allocation Percentage as set forth in Exhibit G that the Non-Participating State or Non-Participating Litigating Subdivision would have received if it had participated in the Settlement Agreement; b. Except as set forth below in subparagraph III.E.9.c, for any settlement or judgment that meets the requirements of paragraph III.E.9 that exceeds the abatement amount derived from the application of the State Global Allocation Percentage as set forth in Exhibit F-1 or the abatement amount derived from the application of the Subdivision and Special District Allocation Percentage as set forth in Exhibit G, no credits shall be taken against Teva or Allergan’s obligation to make payments into the Common Benefit Fund for that portion of the settlement or judgment in excess of the abatement amount derived from the application of the State Global Allocation Percentage as set forth in Exhibit R-10
F-1 or the abatement amount derived from the application of the Subdivision and Special District Allocation Percentage as set forth in Exhibit G; c. For any settlement or judgment that meets the requirements of paragraph III.E.9 that exceeds the abatement amount derived from the application of the State Global Allocation Percentage as set forth in Exhibit F-1 or the abatement amount derived from the application of the Subdivision and Special District Allocation Percentage as set forth in Exhibit G that the Later Litigating State or Later Litigating Subdivision would have received if it had participated in the Settlement Agreement, where the Later Litigating State or Later Litigating Subdivision is represented by any member of the MDL PEC or that member’s law firm, Teva or Allergan shall be credited dollar-for-dollar for the full amount of the 7.5% common benefit fee assessment paid into the Common Benefit Fund or the Court Common Benefit Fund;
d. If a credit is made to Allergan or Teva pursuant to subparagraph III.E.9.c., then that amount shall be calculated as a direct reduction to any common benefit fee award made under this Fee Agreement to the MDL PEC firm(s) that represented the Later Litigating State or Later Litigating Subdivision; e. Any credits shall be taken first against Teva’s or Allergan’s payment to the Common Benefit Fund in Teva’s or Allergan’s respective final Payment Year as set forth in paragraph III.E.1 (for Teva Year 6; for Allergan Year 4), up to the full amount of Teva’s or Allergan’s final year payment obligation, then from the next-to-final Payment Year’s payment obligation, and so on; f. Teva and Allergan shall not be entitled to any credits against the Common Benefit Fund for settlements or judgments paid after Teva’s or Allergan’s final fee Payment Year.
F. Contingency Fee Fund (40% of the Attorney Fee Fund).
1. Funds from the Attorney Fee Fund shall be allocated to the Contingency Fee Fund on the following yearly schedule, subject to the adjustments set forth below:
Teva Shall Pay Allergan Shall Pay
Payment
Year 1 $ 18,486,335.17 $ 16,311,542.21
Payment
Year 2 $ 18,486,335.17 $ 16,311,542.21
Payment
Year 3 $ 22,086,335.17 $ 18,711,542.21
Payment
Year 4 $ 22,086,335.17 $ 18,711,542.21
Payment
Year 5 $ 22,086,335.17 $ 0.00
Payment
Year 6 $ 22,086,335.17 $ 0.00
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2. The Contingency Fee Fund shall be available to compensate Attorneys engaged in Qualifying Representations of Participating Litigating Subdivisions that meet the criteria set forth in subsection III.G.
a. The Contingency Fee Fund shall be available to Attorneys who represent Litigating Subdivisions that are Participating Subdivisions, whether their actions are filed in state or federal court, and meet the eligibility criteria of subsection III.G.
b. Participation in the Contingency Fee Fund by counsel that have a case that is not subject to the jurisdiction of the MDL Court shall not create, provide, or waive jurisdiction of the MDL Court over that Litigating Subdivision, that case or Attorneys, other than to oversee the fairness of the distribution process, and enforcement of this Fee Agreement.
c. Under the terms of the Teva Agreement and Allergan Agreement Litigating Subdivisions must become a Participating Litigating Subdivision under both Agreements to be eligible to participate. Therefore, Exhibit R applies jointly to Teva and Allergan with the Attorneys’ Fee Fund and MDL Cost Fund to include the combined payment from Teva and Allergan.
3. Teva and/or Allergan shall each be entitled to a pro-rata reduction to their own portion of the Contingency Fee Fund payment(s) in accordance with subsection III.F.4., unless, by the Payment Date for the Initial Year Payment, (i) 41 states are Settling States for Teva or 43 states are Settling States for Allergan, (ii) 98% of all Litigating Subdivisions are Participating Subdivisions and/or Subdivisions Subject to a Bar, Case-Specific Resolution, and, (iii) 97% of all Non-Litigating Subdivisions with Populations over 10,000 as listed in Exhibit I are Participating Subdivisions and/or Subdivisions Subject to a Bar, Case-Specific Resolution, in which case no offset shall be applied.
4. If the participation conditions in paragraph III.F.3 are not met, then the amounts owed by Teva and/or Allergan to the Contingency Fee Fund shall be reduced as follows:
a. For Non-Settling States, the Contingency Fee Fund payments shall first be reduced by the amounts identified by the Fee Panel, pursuant to paragraph III.H.7, that would have been owed to counsel for Litigating Subdivisions in Non-Settling States, had those States and those Litigating Subdivisions been Settling States and Participating Subdivisions.
b. Following the calculation in subparagraph III.F.4.a., the Contingency Fee Fund payments shall be reduced to reflect the non-joinder of Litigating Subdivisions in Settling States by subtracting the amounts identified by the Fee Panel, pursuant to paragraph III.H.7, that would have been owed to counsel for Non-Participating Litigating Subdivisions in Settling States had such Litigating Subdivisions been Participating Subdivisions.
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5. In the event that after the date of the Settlement Agreement Teva, prior to the Effective Date of the Teva Agreement, or Allergan, prior to the Effective Date of the Allergan Agreement, settles with any Litigating Subdivision that would have been eligible to participate in the defendant’s Agreement, and, under such settlement agreement pays attorneys’ fees, the Fee Panel shall treat those Litigating Subdivisions as Participating Litigating Subdivisions and, applying the same criteria applicable to all Attorneys for Participating Litigating Subdivisions, determine what amount they would have been paid from the Contingency Fee Fund if they had become Participating Subdivisions under the Teva Agreement or the Allergan Agreement without such prior settlement. That sum, rather than being paid to the Attorney for the previously settling Litigating Subdivision, shall be credited and/or returned to Teva or Allergan as if determined under (a)(ii) above, except that such credit shall not be greater than the amount paid to the Attorneys under the Litigating Subdivision’s prior settlement agreement and credits apply equally over the Fee Payment Years.
6. During the period between the Preliminary Agreement Date and the Effective Date, the MDL PEC, as well as Litigating Subdivisions’ Attorneys, shall make best efforts to cease litigation activity against Teva and Allergan, including by jointly seeking stays or severance of claims against Teva and Allergan, where feasible, or postponements if a motion to stay or sever is not feasible or is denied, so long as such actions are not otherwise detrimental to the Litigating Subdivision.
G. Eligibility.
1. It is the intention of all parties participating in the Fee Panel process that there should be total transparency to the Fee Panel and to all fund participants. In connection with the process to be developed by the Fee Panel, any and all monies in attorney’s fees received or awarded, including prior or future Contingency Fees, Common Benefit Fees, referral fees, expenses paid, promises for payment, or any other Fee Entitlement, to any Applicant in any opioid litigation shall be disclosed to the Fee Panel as a condition of participating in the Attorney Fee Fund and prior to an award from the Fee Panel. Any payment, expectation of payment or perceived entitlement to participate in a State Back-Stop Agreement or any other agreement reached with a Settling State or any Subdivision or any other source regarding payment of fees must be disclosed to the Fee Panel. Similarly, any right to payment from any other fund, for example a fund for payment to lawyers representing Settling States or Tribal Nations or Subdivisions shall be disclosed to the Fee Panel. Because it is anticipated that there will be multiple firms listed on contingent fee agreements with Litigating Subdivisions, the Fee Panel shall establish procedures, with input from Attorneys for Participating Litigating Subdivisions, for who should petition for fees from such groups and to whom the fee shall be paid and thereafter distributed to co-counsel in accordance with applicable agreements. For the avoidance of doubt, all Attorneys that are part of such groups must meet the eligibility criteria in paragraph III.G.3, must be subject to the criteria set forth in subsection III.C, and must be disclosed to the Fee Panel.
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2. An Applicant may apply for and recover attorneys’ fees from the Common Benefit Fund, the Contingency Fee Fund, and any fund created by a past or future State Back-Stop Agreement, provided the Applicant satisfies the requirements relevant to each such fund and requirements for disclosure to the Fee Panel.
3. An Attorney may not receive any payment from the Attorney Fee Fund (which includes both the Contingency Fee Fund and the Common Benefit Fund) unless the following eligibility criteria are met and annually certified by the Attorney:
a. The Attorney must expressly waive the enforcement against the Litigating Subdivision client of all Fee Entitlements (other than under State BackStop Agreements) arising out of or related to any or all Qualifying Representations of any Participating Litigating Subdivision prior to applying for attorneys’ fees from the Attorney Fee Fund. All applications for attorneys’ fees under this Fee Agreement shall include an affirmation by the Attorney of such waiver and notice to the client(s) of such waiver.
Such waiver shall not preclude the Attorney from submitting such Fee Entitlements to the Fee Panel as a factor for consideration in allocating payments from the Attorney Fee Fund or in connection with a State BackStop Agreement. For the avoidance of doubt, no Attorney may recover fees under this Fee Agreement unless the Attorney expressly agrees not to enforce Fee Entitlements as to each and every Participating Litigating Subdivision represented by that Attorney, but such Attorneys may participate in and receive funds from a State Back-Stop Agreement. b. The Attorney must represent that s/he has no present intent to represent or participate in the representation of any Later Litigating Subdivision or Later Litigating State with respect to Released Claims against Released Entities.
c. The Attorney must represent that s/he has not and will not engage in any advertising or solicitation related to Released Claims against Released Entities where such advertising or solicitation relates to a representation of a Subdivision eligible to be a Participating Subdivision after the Reference Date unless the Attorney is recommending participation in the Agreement.
d. The Attorney must represent s/he will not charge or accept any referral fees for any Released Claims brought against Released Entities by Later Litigating Subdivisions or Later Litigating States. This representation shall not prohibit Attorneys from receiving allocated shares of any future common benefit assessments arising out of settlements or judgments with Later Litigating Subdivisions or Later Litigating States that are the result of the MDL Court’s Common Benefit order.
e. The Attorney may not have and must represent that s/he does not have a Fee Entitlement related to a Later Litigating Subdivision or Later Litigating State, other than a potential Common Benefit Fee.
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f. The Attorney must fully disclose the participation, or the anticipation of participation, in any agreement with a Settling State or Participating Subdivision concerning fees arising out of or related to the Teva Agreement or Allergan Agreement, including any fees paid or anticipated to be paid or any State Back-Stop Agreement.
g. The Attorney must identify for the Fee Panel whether s/he utilized state litigation work product or MDL work product, including but not limited to ARCOS data, document repositories, experts developed in the MDL, trial transcripts, or deposition transcripts. The Attorney must identify whether s/he signed the MDL Participation Agreement.
h. Any Attorney who applies for fees from one or both Funds must represent that, having exercised his/her independent judgment, s/he believes the Teva Agreement and the Allergan Agreement to be fair and will make or has made best efforts to recommend both Agreements to his or her Subdivision clients in Settling States. For avoidance of doubt, each Attorney is expected to exercise his or her independent judgment in the best interest of each client individually before determining whether to recommend joining the settlement. All applications for attorneys’ fees or costs under this subsection shall include an affirmation by the Attorney in compliance with the foregoing subparagraphs.
4. No Attorney receiving fees under this Fee Agreement may apply for or recover from the Attorney Fee Fund fees arising from representing a Non-Participating Subdivision except Common Benefit Fees as described in paragraph III.E.2. All applications for attorneys’ fees under this subsection shall include an affirmation by the Attorney of compliance with this paragraph.
5. An Attorney who has filed an application under this subsection and received an award of attorneys’ fees shall provide a certification of compliance with the requirements of this Fee Agreement annually during the years upon which they are still entitled to receive attorneys’ fee payments under this Agreement. This certification will be done as directed by the Panel.
6. If, at any time, the Attorney is unable to make the representations set forth in this subsection, such representations become untrue, or the Attorney falsely represents compliance with the eligibility criteria, the Attorney shall cease to be eligible to receive funds from the Attorney Fee Fund until further review by the Fee Panel of the Attorney’s eligibility under and compliance with this subsection.
7. If an Attorney has a Fee Entitlement with a Later Litigating Subdivision or Later Litigating State or otherwise becomes unable to reaffirm compliance with the eligibility criteria set forth above, the Attorney shall notify the Fee Panel. For the avoidance of doubt, any Attorney who undertakes any new representation of, or has a Fee Entitlement with, a Later Litigating Subdivision or Later Litigating State shall be prohibited from receiving any future funds from the Attorney Fee Fund.
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If an Attorney fails to notify the Fee Panel of such Fee Entitlement with a Later Litigating Subdivision or Later Litigating State, the Attorney shall be required to refund amounts previously paid. The Fee Panel shall notify Teva and Allergan when it receives notification.
8. To the extent an Attorney who has received compensation from the Attorney Fee Fund based on Qualifying Representations of Participating Litigating Subdivisions under the Teva Agreement or the Allergan Agreement, represents a Later Litigating Subdivision or Later Litigating State, such Attorney shall be obligated to refund such amounts received as compensation from the Attorney Fee Fund to Teva or Allergan. Teva, Allergan, or such Attorney may bring any dispute as to whether such Attorney shall be obligated to refund such amounts received from the Attorney Fee Fund to Allergan or Teva to the Fee Panel. Nothing herein shall require a multi-attorney law firm that has received compensation from the Attorney Fee Fund to refund such amounts if an attorney of the firm that is no longer affiliated with such law firm, after such departure, represents a Later Litigating Subdivision or Later Litigating State, provided that (a) neither the law firm nor any of its other attorneys have any contractual or financial arrangement regarding, stand to benefit directly or indirectly from, or directly or indirectly provide financial or other support of any kind to, the former attorney’s representation of the Later Litigating Subdivision or Later Litigating State and (b) if the former attorney was a partner or owner of the multi-attorney law firm at the time that the law firm received compensation from the Attorney Fee Fund, the former attorney shall be obligated to refund such amounts as the former attorney earned as a result of the compensation that the law firm received from the Attorney Fee Fund.
9. In the event that an Attorney is deemed ineligible by the Fee Panel (whether based on its initial application or subsequent recertification), the Fee Panel shall provide notice to the Attorney and give the Attorney 30 days to provide additional information such that the Fee Panel could re-consider the Attorney’s eligibility.
10. To the extent that an Attorney has a Fee Entitlement with a Participating Subdivision and is authorized to bring Released Claims against Released Entities, but such authorization is, in scope, less broad than the category of Released Claims set forth in the Teva Agreement or Allergan Agreement, such Attorney may participate fully in both the Contingency Fee Fund and the Common Benefit Fund, without any reduction imposed by the Fee Panel due to the scope of the authorization, so long as the Participating Subdivision fully releases all Released Claims against Released Entities.
11. Attorneys applying to the Attorney Fee Fund knowingly and expressly agree to be bound by the decisions of the Fee Panel, subject to the limited appeal rights set forth in this Fee Agreement, and waive the ability to assert the lack of enforceability of the allocation reached through the procedures outlined herein.
12. Applicants are under an ongoing obligation to inform the Fee Panel in writing of any additional fees earned, expected, or received related to any Opioid litigation throughout the period of the Fee Panel’s operation.
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H. Calculation of Amounts Due.
1. The Fee Panel shall be solely responsible for determining the amount of fees to be paid to each Applicant. None of the Released Entities shall have any responsibility, obligation, or liability of any kind whatsoever with respect to how attorneys’ fees are calculated under this subsection, except that the Fee Panel may receive information from Teva or Allergan as to (a) the identity of Participating, Non-Participating, Litigating, Later Litigating, and Non-Litigating Subdivisions; (b) the impact of non-participation by a Litigating Subdivision as is relevant to the Fee Panel’s determination in paragraph III.E.6; and (c) such other information as Teva or Allergan may voluntarily elect to provide.
2. The Fee Panel shall establish procedures for making determinations under this Fee Agreement consistent with this Fee Agreement and orders of the MDL Court.
Such procedures may include submission of documentary and/or other evidence, interviews with Applicants and/or other counsel (including counsel for Teva and Allergan) that the Fee Panel deems appropriate, and/or other means of creating a record upon which fee awards will be based.
3. In making determinations under this Fee Agreement, the Fee Panel must apply the eligibility criteria set forth in subsection III.G of this Fee Agreement and the criteria set forth in paragraph III.E.2. In addition, the Fee Panel will give consideration in regard to Common Benefit Fund awards to the Johnson factors, as well as the following factors (which factors may be applied and given relative weight in the Fee Panel’s discretion):
a. The Applicant’s contemporaneously recorded time and labor dedicated to Qualifying Representations along with the Applicant’s financial commitment to such Qualifying Representations. Claimed “time” will not be automatically accepted by the Fee Panel but will be critically reviewed and given substantially more weight and consideration if such time was subject to the audit process described in any Pretrial Order(s) governing the collection of common benefit time;
b. The novelty, time, and complexity of the Qualifying Representations; c. The skill requisite to perform legal services properly and undesirability of the case;
d. The preclusion of other employment by the Applicant due to time dedicated to Qualifying Representations;
e. The Common Benefit, if any, alleged to have been conferred by the Applicant and whether such Common Benefit work product by that Applicant was used by others in parallel litigations against Released Entities whether within or outside the MDL, provided that any Applicant claiming that s/he substantially benefited cases other than those in which s/he entered an appearance as R-17
counsel must substantiate such claims by proffering factual support, such as proper supporting affidavits or other documents as determined by the Fee Panel with input from Attorneys for Participating Litigating Subdivisions; f. Any “common detriment,” as set forth in paragraph III.E.6. g. Any contingent fee agreement or other Fee Entitlement with Participating Subdivisions, enforcement of which, except for State Back-Stop Agreements, are waived in conjunction with the application, the nature and extent of any work for those Participating Subdivisions, whether such Participating Subdivisions actively litigated and, if so, the nature and procedural history of such case(s);
h. The experience, reputation, and ability of the Applicant; i. Whether the Applicant’s clients brought Released Claims against Released Entities;
j. The status of discovery in cases primarily handled by the Applicant; k. The nature of any work by the Applicant on “bellwether” cases or cases that were similarly active in litigation;
l. Any pressure points successfully asserted by the Applicant in cases against Teva or Allergan or any risk for Teva or Allergan created by the Applicant in cases against them;
m. Any risk for defendants created by Applicants in cases against Teva or Allergan;
n. Successful and unsuccessful motion practice in cases worked on by the Applicant;
o. The date of filing of any cases filed by the Applicant; p. Obtaining consolidation of the litigation in the Applicant’s jurisdiction; q. The number and population of entities represented by the Applicant and the fees that would have been awarded under extinguished contingent fee arrangements;
r. Whether the Applicant’s clients brought claims against Teva or Allergan; s. Whether the Applicant has had a leadership role in the litigation, whether in state or federal court;
t. Whether the Applicant has had a leadership role in any negotiations aimed at resolving the litigation;
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u. Whether the Applicant’s cases have survived motions to dismiss; v. The extent to which the Applicant contributed to the work product used for the common benefit of opioids litigants, including, without limitation, work on ARCOS data, Prescription Data Monitoring Programs, IQVIA data, depositions, document production and analysis experts, motions, briefs and pleadings, trial preparations, and trials;
w. The extent to which litigation was done prior to and contributed to completion of settlement negotiations, as distinct from litigation that was done litigating after the announcement of the Teva Agreement or Allergan Agreement, such latter litigation both being of less value and potentially resulting a common detriment to the settlement process; and
x. Any other factors that the Fee Panel finds to be appropriate to consider after input from Applicants to the Attorney Fee Fund.
4. In the event that States and Subdivisions enter into an additional global settlement with a party or parties other than Teva or Allergan that is (a) under the jurisdiction of the MDL Court in MDL No. 2804, (b) creates a separate common benefit fund to be administered by the Fee Panel, and (c) unless the parties agree to another date, such agreement has an effective date prior to June 30, 2023, the Fee Panel may:
a. Consolidate the Common Benefit approval process to include evaluation of all Common Benefit Applications for all settlements entered after November 14, 2022;
b. Determine the fair and equitable allocation of the Aggregate Common Benefit Fees that come after November 14, 2022;
c. Give consideration to the amount and timing of each settlement, including the amount and timing of Common Benefit Fees;
d. The Fee Panel shall abide by the applicable Attorney Fee Agreement in each of the Settlements in Allocating the Common Benefit Fees provided for in the Settlement; and
e. Be guided in their work by the Orders of the Court related to Fees and Costs.
5. The Fee Panel shall develop procedures for receiving a single application, which may be updated or amended based on new information (such as participation by additional Litigating Subdivisions) from each Applicant seeking compensation from each sub fund of the Attorney Fee Fund pursuant to processes and procedures developed by the Fee Panel, which shall not be inconsistent with this Fee Agreement. Any request for attorneys’ fees not included on the single application or through the updating/amendment process designed by the Fee Panel R-19
shall be deemed waived. For purposes of transparency and to permit the Fee Panel to conduct its work, the application from each Applicant shall, at a minimum, require each Applicant to:
a. Identify all Litigating Subdivisions for which s/he is seeking payment from the Attorney Fee Fund;
b. Identify all Subdivisions in both Settling and Non-Settling States (and, where applicable, Tribal Nations) with respect to which s/he has a Fee Entitlement with respect to Relevant Claims against Released Entities, and identify all cocounsel in such cases; c. Identify which of those Subdivisions are Participating Subdivisions and which are not (with similar information for Tribal Nations, where applicable); d. Specify the specific fund or funds within the Attorney Fee Fund from which the Attorney is seeking compensation;
e. Demonstrate his or her eligibility for compensation from the relevant sub funds within the Attorney Fee Fund pursuant to the criteria set forth for the relevant sub fund;
f. Identify any and all Fee Entitlements from representations of States, Tribal Nations, or other plaintiffs related to Released Claims against Released Entities or in opioids-related matters;
g. Notwithstanding “a-f” above, the Panel may consider a supplemental application if the Applicant shows good cause why circumstances exist that will lead to consideration for additional Common Benefit award. Examples would include, but are not limited to, an Applicant having Non-Participating Litigating Subdivision clients that subsequently become Participating Subdivisions, a Bar Date passes that increases participation or the Participation Tier, or an Allocation Agreement is reached.
6. With respect to the Common Benefit Fund, the Fee Panel shall (subject to any applicable MDL Court Order):
a. Review the applications of all Applicants seeking compensation from the Common Benefit Fund, including determining eligibility for each Applicant as set forth in subsection III.G.
b. Reduce, on an annual basis, Teva’s or Allergan’s payment obligations, as set forth in paragraph III.E.7. The Panel shall inform Teva or Allergan, and the MDL PEC of all such amounts and adjust payment obligations accordingly. c. Using criteria set forth in subsections III.E and III.H, allocate amounts from the Common Benefit Fund to eligible Applicants, including payment amounts for each Payment Year. In making such allocations, the Panel shall apply the R-20
principles set forth in paragraph III.E.6 and shall allocate any reduction in the payments specified in paragraph III.E.7 to the amounts paid to Applicants with a Common Benefit Fee Entitlement.
7. With respect to the Contingency Fee Fund, the Fee Panel shall:
a. Review the applications of all Attorneys seeking compensation from the Litigating Subdivision Fee Fund, including determining eligibility for each Attorney as set forth in subsection III.G.
b. Apply the Mathematical Model in Exhibit A.
c. Use such allocations to reduce on an annual basis the payment obligations of Teva or Allergan to the Attorney Fee Fund as set forth in paragraph III.F.4, and distributions therefrom, and inform Teva or Allergan and the MDL PEC of all such adjustments.
8. To the extent that there is a dispute about the calculations of the Fee Panel related to the amounts that Teva or Allergan is required to pay (including application of any reductions or offsets under this Fee Agreement), such disputes shall be presented to the Fee Panel and any disputed funds be paid into/held in escrow.
The Fee Panel shall resolve such disputes expeditiously, with either Party having the right to seek review from the MDL Court.
9. For purposes of determination of fee or cost awards, allocations, reductions, and possible reversions under this Fee Agreement, unless specified otherwise a Subdivision will be considered a Non-Participating Subdivision if it is not a Participating Subdivision as of the deadline for the application for the fee at issue (or, if the determination does not involve a specific application, the date on which the record for such determination closes).
10. In the event that the Fee Panel, through the use of the Mathematical Model set forth in Exhibit A, allocates funds from the Contingency Fee Fund for an Attorney based on a Qualifying Representation of a Participating Litigating Subdivision and that Subdivision is in a Settling State in which the Consent Judgment has not been approved, such funds shall be placed into escrow until the Consent Judgment is approved, after which time they shall be released.
I. Miscellaneous.
1. The Fee Panel shall charge an hourly rate approved by the Court. The PreEffective Date costs associated with the Cost and Expense Fund Administrator shall be paid from funds in the Cost Fund. Post-Effective Date, the cost of the Fee Panel shall be charged against the applicable Fee Fund based on allocation by the Fee Panel and shall not be otherwise funded by Teva and Allergan.
2. The MDL PEC shall provide to Teva and Allergan information they have that identifies Attorneys who represent Litigating Subdivisions who are not R-21
Participating Subdivisions and who have an obligation to pay a common benefit assessment, either due to the MDL Court’s orders or pursuant to a Participation Agreement.
3. Participating Subdivisions agree to instruct their counsel to treat information, work product and expert materials as confidential under Rule 1.6 of the ABA Model Rules of Professional Conduct. Accordingly, an Attorney shall not share information or work product with, or experts or materials to, non-participants (other than the Attorney’s own current clients or their lawyers, consultants, experts or other representatives or agents). However, nothing herein shall prevent MDL Leadership or PEC Counsel from fulfilling their obligations in any MDL and the MDL Court Order.
IV. Miscellaneous
A. Termination. If the Teva Agreement or Allergan Agreement does not proceed past the Reference Date, whether because Teva and Allergan do not determine to proceed or for any other reason, this Fee Agreement shall be null and void, neither Teva nor Allergan shall have any obligation to make any payments under this Fee Agreement other than Fee Panel costs advanced, and Teva, Allergan, and the PEC shall take such steps as are necessary to restore the status quo ante.
B. MDL Court Consideration. This Fee Agreement shall be attached as an exhibit to the Teva Agreement and Allergan Agreement. This Fee Agreement shall also be submitted by Teva, Allergan, and the MDL PEC to the MDL Court for approval pursuant to the motion and order that shall be attached, prior to the Preliminary Agreement Date of the Agreements, as Exhibit B.
1. In the event that the MDL Court, through an order, makes any change to the amounts potentially to be paid by Teva and Allergan under this Fee Agreement, makes any change to the Fee Panel’s consideration of the factors set forth in paragraph III.E.6, or any other material change to the draft Order attached as part of Exhibit B or the terms of this Fee Agreement, Teva, Allergan, and the MDL PEC shall meet and confer concerning such changes.
2. If Teva, Allergan, and the MDL PEC are unable to reach agreement and revisions to this Fee Agreement, this Fee Agreement shall be null and void, Teva and Allergan shall have no obligation to make any payments under this Fee Agreement, and Teva, Allergan, and the MDL PEC shall take such steps as are necessary to restore the status quo ante.
C. Amendment. Once the MDL Court has entered an order implementing this Fee Agreement, this Fee Agreement can only be amended by (1) written agreement of Teva, Allergan, and the MDL PEC and (2) approval by the MDL Court.
D. Jurisdiction and Enforcement. The MDL Court shall have exclusive and ongoing jurisdiction over the enforcement and implementation of this Fee Agreement as set forth herein. The MDL PEC shall be the Authorized Party to enforce this Fee R-22
Agreement, as to the payment obligations of Teva and Allergan as set forth in this subsection and as to Attorneys making application to the Funds under this Fee Agreement. Solely for purposes of assessing or allocating common benefit fees, the MDL Court will continue to have jurisdiction over the work product developed in the MDL Court by and under the direction of the MDL PEC with respect to claims against Teva or Allergan, including data and documents, depositions, expert reports, briefs and pleadings; and the MDL Court’s protective orders, management orders, and other decisions regarding such discovery and other work product, including but not limited to, conditions on its use, will continue in full force and effect. Nothing in this subsection authorizes the MDL Court to act contrary to this Agreement or provides the MDL Court with jurisdiction over the Teva Agreement or Allergan Agreement.
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EXHIBIT S
Agreement on the State Outside Counsel Fee Fund
for Manufacturer Settlements
1. Definitions.
a. “Manufacturer” means any of Teva and Allergan, and “Manufacturers” means all of the foregoing.
b. “Multistate Manufacturer Settlement Agreement” means This Settlement Agreement along with the separate settlement of opioids-related claims among 30 or more states and the other Manufacturer.
c. “This Settlement Agreement” means the settlement agreement between the Settling States and the Manufacturer to which this Agreement is attached as an Exhibit.
d. “Settling Manufacturer” means the Manufacturer that is a party to This Settlement Agreement.
e. “Settling States” has the meaning given such term in the relevant Multistate Manufacturer Settlement Agreement.
2. Creation of a State Outside Counsel Manufacturers Fee Fund. The Settling States have agreed to the creation of a state outside counsel fee fund to pay reasonable attorneys’ fees of Settling States which have retained outside counsel in connection with litigation against one or more Manufacturers (such fund, the “State Outside Counsel Manufacturers Fee Fund”).
3. State Outside Counsel Manufacturers Fee Fund Administration. The State Outside Counsel Manufacturers Fee Fund shall be administered separately from any other funds for the payment of attorneys fees or costs in connection with This Settlement Agreement, including any common benefit fund, contingency fee fund for subdivision counsel, state cost fund, or MDL expense fund. If necessary, a committee of Attorneys General shall be convened to oversee the State Outside Counsel Manufacturers Fee Fund (the “Manufacturers Fee Fund Committee”). The Manufacturers Fee Fund Committee shall be appointed by the Settling State Members of the Enforcement Committee and shall be comprised solely of Attorneys General of Settling States that engaged outside counsel to pursue litigation against one or more Manufacturers. The Settlement Fund Administrator (the “Fee Fund Administrator”) shall administer the State Outside Counsel Manufacturers Fee Fund according to this Exhibit and, if convened, the guidelines and directives of the Manufacturers Fee Fund Committee.
4. State Outside Counsel Manufacturers Fee Eligibility. a. To receive any amount from the State Outside Counsel Manufacturers Fee Fund, both of the following must be true:
1. an outside counsel to a Settling State must have filed and maintained S-2
an action in the name of a Settling State or its Attorney General against a Manufacturer in a state or federal court as of November 1, 2022; and
2. the State must become a Settling State for each Multistate Manufacturer Settlement Agreement for which it is eligible. b. No Settling State (or its outside counsel) shall receive funds from both the State Outside Counsel Manufacturers Fee Fund and any “Additional Restitution Amount” as may be provided for in This Settlement Agreement. c. In addition to the eligibility criteria set forth in Paragraph 4.a, above, and for the avoidance of doubt, only Settling States under This Settlement Agreement are eligible to receive any funds paid into the State Outside Counsel Manufacturers Fee Fund as a result of This Settlement Agreement.
5. State Outside Counsel Manufacturers Fee Fund Amount. The Settling Manufacturer shall pay funds into the State Outside Counsel Manufacturers Fee Fund in an amount equal to, and on the schedule identified in, Exhibit M (the “Contribution”). The Settling Manufacturer’s Contribution shall be subject to a reduction as described in Paragraph 8, below.
6. State Outside Counsel Manufacturers Fee Fund Availability and Calculation of Amount.
a. The State Outside Counsel Manufacturers Fee Fund shall be available to compensate private outside counsel for Settling State Attorneys General for approved fees arising out of representation of the Settling State pursuant to the schedule attached to this agreement as Schedule I (the “Fee Schedule”). b. The Fee Schedule is intended to reflect the fee calculation in subparagraphs 6.c and 6.d, below (the “Fee Calculation”). Subject to adjustments required by Paragraph 8, below, in the event of any discrepancy between the Fee Schedule and the Fee Calculation, the Fee Schedule shall control. Each Settling State, by becoming a Participating State in This Settlement Agreement, agrees that the Fee Schedule reflects the Fee Calculation and waives any right to contest the accuracy of the Fee Schedule, absent manifest error, the exclusion of a Settling State, or the inclusion of a Non-Settling State. The version of the Fee Schedule reflecting any necessary adjustments shall be the “Final Fee Schedule.”
c. Except as provided in Paragraph 6.d, below, fees shall be aggregated across the Multistate Manufacturer Settlement Agreements and be calculated by adding two components: (a) a fixed amount consisting of fifty percent (50%) of the amount of remediation funds allocated to a Settling State and its Subdivisions pursuant to the Multistate Manufacturer Settlement Agreements multiplied by
4.5% (or, if lower, the applicable contingency fee percentage in the Settling State’s outside counsel contract); and (b) a proportional percentage of the S-3
remaining fee due under that Settling State’s contract with its outside counsel assuming that fifty percent (50%) of the Settling State’s recovery is allocable to a Settling State (rather than allocable to the Settling State’s Participating Subdivisions) so that the fees of all eligible Settling States (minus the fixed amount that would have been allocated to any Non-Settling States had they become Settling States) exhausts the State Outside Counsel Manufacturers Fee Fund. The proportional share percentage will be the same for each Settling State included in the State Outside Counsel Manufacturers Fee Fund. Except as set forth in Paragraph 6.d, fees shall be split proportionally among each Multistate Manufacturer Settlement Agreement, as set forth on the Fee Schedule.
d. Notwithstanding the foregoing, fees for the State of Oklahoma, if it becomes a Settling State under the Multistate Manufacturer Settlement Agreement with Allergan, shall be limited to Oklahoma’s share of the State Outside Counsel Manufacturers Fee Fund derived from Allergan’s Contribution. Oklahoma’s share of the State Outside Counsel Manufacturers Fee Fund derived from Teva’s Contribution shall be reallocated proportionally among the other Settling States eligible to receive payments from the State Outside Counsel Manufacturer Fee Fund.
e. All amounts paid will be less the following:
1. Any costs or fees of the Fee Fund Administrator. The Fee Schedule reflects a holdback amount of $50,000 for such administrative expenses of the Fee Fund Administrator, the remainder of which shall be disbursed proportionally to States receiving monies from the State Outside Counsel Manufacturers Fee Fund at the conclusion of such administration.
7. Payment by the Fee Fund Administrator.
a. The Fee Fund Administrator shall hold the Contribution in escrow until the earlier of (1) both Multistate Manufacturer Settlement Agreements become effective or (2) when instructed by the Settling State Members of the Enforcement Committee.
b. Subject to eligibility pursuant to Paragraph 4, above, a Settling State’s outside counsel may receive funds from the State Outside Counsel Manufacturers Fee Fund in the following scenarios (“Payment Scenarios”):
1. The Settling State’s outside counsel agrees that the amount listed for such state on the Final Fee Schedule either satisfies in full or exceeds the amounts owed to all such Settling State’s outside counsel and such counsel has provided written notice waiving all entitlement to additional fee in respect of any Multistate Manufacturer Settlement S-4
Agreement.
2. The Settling State and its outside counsel enter into a signed writing establishing the amount owed to the counsel, which includes an agreement on the payment of the amount listed for such state on the Final Fee Schedule and waives any right of the State or its outside counsel to additional amounts from the State Outside Counsel Manufacturers Fee Fund.
3. A final judgment is entered that is no longer appealable, which judgement adjudicates the amount owed to the Settling State’s counsel in respect of This Settlement Agreement and directs the Manufacturers Fee Fund Committee how to pay the amount listed on the Final Fee Schedule for such State.
If no Payment Scenario is applicable with respect to a Settling State, then the Settling State’s share shall be placed in an interest-bearing escrow account (less reasonable expenses of the Fee Fund Administrator) and held unless and until a Payment Scenario is applicable.
c. Upon the applicability of a Payment Scenario 1 with respect to a Settling State, the Fee Fund Administrator shall pay that Settling State’s outside counsel the amount identified on the Final Fee Schedule for such state or such lesser amount that satisfies the Settling State’s obligation to its outside counsel in full. Any remaining allocation to such State shall be paid to the Settling State.
d. Upon the applicability of a Payment Scenario 2 or 3 with respect to a Settling State, the Fee Fund Administrator shall release monies from the State Outside Counsel Manufacturers Fee Fund in either the amount held by the Fee Fund Administrator, if the amount of the agreement or judgment is equal to or more than the amount held, or the amount indicated in the agreement or in the final judgment, if the amount in the agreement or judgment is less than the amount held.
e. Nothing herein, including the amounts listed in Paragraph 6 above or on any Fee Schedule, shall prevent a Settling State from arguing in any proceeding with its outside counsel that (i) its recovery was less than fifty percent (50%) of the recovery in the settlement agreement down to and including fifteen percent (15%) of the total recovery; (ii) any payment should be discounted by an appropriate discount rate commensurate to the risk of the settlement agreement and the timeline that the Settling State is receiving its payments; (iii) the settlement amount should be lower because the amount a Settling State receives was reduced because such Settling State’s outside counsel failed to obtain joinder from a Settling State’s Subdivision(s) that the outside counsel also represented; or (iv) any S-5
limitation placed by the Settling Manufacturer bars payment of a higher fee to outside counsel.
f. In the event the amount due to the Settling State’s outside counsel from an escrow account is less than the total amount of funds escrowed on the account of the Settling State, the balance shall be paid to the Settling State. In no event, other than a State becoming a Non-Settling State, shall funds revert to a Manufacturer.
8. Non-Settling States; Reversion and Redistribution. Amounts owed by the Settling Manufacturer to the State Outside Counsel Manufacturers Fee Fund shall be reduced by amounts allocated to the fixed amount for such State under This Settlement Agreement in the event that a listed State becomes a Non-Settling State. The payments for the other Settling States reflected in the Fee Schedule shall be adjusted by the Fee Fund Administrator to reflect a recalculated proportional percentage under the Fee Calculation.
9. Interpretation.
a. This Agreement shall be an Exhibit to each Multistate Manufacturer Settlement Agreement and shall include the Fee Schedule setting forth the presumptive payment calculations for each eligible Settling State. By joining This Settlement Agreement, each State agrees on the presumptive accuracy of the Fee Schedule, absent manifest error, the inclusion of a Non-Settling State, or the exclusion of a Settling State. b. It is the intent of all parties that the State Outside Counsel Manufacturers Fee Fund function in a similar manner, with similar calculations and mechanics, as the “State Outside Counsel Fee Fund” established in Exhibit S of that certain settlement agreement dated as of July 21, 2021 setting forth the terms of settlement between and among McKesson Corporation, Cardinal Health, Inc., and AmerisourceBergen Corporation, on the one hand, and certain settling states and certain participating subdivisions, on the other hand.
S-1
Schedule I to Exhibit S
Fee Schedule
State
Total Fee Allergan Share Teva Share
Alaska $1,252,625.36 $424,966.99 $827,658.36
Delaware $2,194,254.56 $744,425.11 $1,449,829.45
Georgia $6,557,324.06 $2,224,644.65 $4,332,679.41
Hawaii $1,272,349.43 $431,658.60 $840,690.83
Idaho $1,413,869.58 $479,670.88 $934,198.70
Kentucky $5,087,998.16 $1,726,159.60 $3,361,838.56
Mississippi $1,737,202.53 $589,365.16 $1,147,837.38
Nevada
$6,279,564.47 $2,130,411.64 $4,149,152.83
New Mexico
$5,218,189.24 $1,770,328.36 $3,447,860.88
Ohio $6,831,882.94 $2,317,791.78 $4,514,091.16
Oklahoma $1,470,349.73 $1,470,349.73 $-
Puerto Rico $4,823,581.25 $1,636,453.24 $3,187,128.01
South Dakota $673,251.45 $228,408.00 $444,843.46
Admin Expense
Holdbacks
$18,047.03 $31,952.97
Total $16,192,680.76 $28,669,762.00
T-1
Exhibit T
Agreement on the Joint State Cost Fund
1. Definitions.
a. “Opioids Defendant” means Teva, Allergan, or such other defendant in opioids-related litigation that enters into a Multistate Settlement after November 1, 2022, and “Opioids Defendants” means all of the foregoing. b. “Multistate Settlement” means this Settlement Agreement along with any other settlement of opioids-related claims among 30 or more states and an Opioids Defendant.
c. “Settlement Agreement” means the settlement agreement between the Settling States and the Opioids Defendant to which this Agreement is attached as an Exhibit.
d. “Settling Opioids Defendant” means the Opioids Defendant that is a party to the Settlement Agreement.
e. “Settling States” has the meaning given such term in the Settlement Agreement.
2. Creation of a State Cost Fund. The Settling Opioids Defendant and the Settling States agree to the creation of a fund to pay costs and expenses associated with litigation and investigations related to the opioids litigation (such fund, the “State Cost Fund”). The State Cost Fund shall be administered separately from any other funds for the payment of attorneys fees or costs in connection with the Settlement Agreement, including any common benefit fund, contingency fee fund for subdivision counsel, subdivision cost fund, or MDL expense fund.
However, the State Cost Fund shall be administered jointly with similar “State Cost Funds” created in other Multistate Settlements after November 1, 2022; any state cost funds jointly administered in this manner shall be referred to as the “Joint State Cost Fund.” To the extent permissible and feasible, the Joint State Cost Fund may also be jointly administered with any fund for reimbursement of states’ litigation and investigation costs established by a bankruptcy plan, including the Mallinckrodt bankruptcy plan, any plans that may emerge from the bankruptcies of Purdue and Endo, and any similar bankruptcies of opioids defendants. To the extent feasible, the Joint State Cost Fund may also be jointly administered with the State Cost Funds established pursuant to the Distributors Multistate Settlement and the Janssen Multistate Settlement.
3. State Cost Fund Amount. The Settling Opioids Defendant shall pay into the State Cost Fund in the amount listed on, and on the schedule set forth in, Exhibit M (the “Settling Opioids Defendant’s Contribution”) for the purpose paying States’ costs and expenses associated with to the opioid litigation.
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4. Joint State Cost Fund Committee. A committee of Attorneys General or their designated representatives (such committee, the “Joint State Cost Fund Committee”) shall oversee the Joint State Cost Fund. The committee shall be appointed by the Settling State Members of the Enforcement Committee, who shall aim to (i) have equal representation between states that retained contingency fee outside counsel and states that did not retain contingency fee outside counsel with respect to opioids-related litigation, and (ii) maintain consistency of committee membership across state cost funds that compose the Joint State Cost Fund. The Settling State Members of the Enforcement Committee may by majority vote add to or change the composition of the Joint State Cost Fund Committee.
5. Joint State Cost Fund Administrator.
a. The Joint State Cost Fund Committee may select an administrator (the “Joint State Cost Fund Administrator”), who shall administer the Joint State Cost Fund and direct payments to Settling States according to the guidelines and directives of the Joint State Cost Fund Committee. While the expenses of the Joint State Cost Fund Administrator shall be reimbursable pursuant to the principles and guidelines listed below, the Joint State Cost Fund Administrator shall first rely on any separate funds that may be set aside for such purpose in any Multistate Settlement.
b. The Joint State Cost Fund Administrator shall be responsible, under the direction and supervision of the Joint State Cost Fund Committee, for receiving and reviewing applications for reimbursement from the Joint State Cost Fund. This may include the creation of an audit process to ensure the integrity of submissions, as well as reimbursement rules to incentivize accurate submissions.
6. State Cost Fund Guidelines and Principles.
a. Monies in the State Cost Fund shall be released without any delay to reimburse Settling States for documented costs incurred or paid in connection with litigation and investigation related to the opioid litigation. b. In allocating the Joint State Cost Fund, the Joint State Cost Fund Committee shall seek to comply with the following principles:
1. Each State Cost Fund should be used to reimburse costs incurred by States that are Settling States in the Multistate Settlement from which funds are paid. (However, the foregoing sentence does not preclude a Non-Settling State that joins a separate Multistate Settlement from participating in the Joint State Cost Fund with respect to contributions made by other Opioids Defendants.)
2. Funds in any State Cost Fund shall be primarily used to reimburse T-3
costs incurred prior to the date on which the relevant Multistate Settlement was first made available for participation to eligible States. Regardless of other factors considered in prioritizing payments, all costs incurred prior to January 1, 2023, shall be paid before any costs incurred after that date are paid.
3. The Joint State Cost Fund shall prioritize the reimbursement of the following over reimbursement of any State’s litigation or investigation costs:
• the reasonable costs of the Joint State Cost Fund
Administrator;
• repayment of National Association of Attorneys General grants made in connection with opioid investigations and litigation, without regard to when the grants were made; • repayment of state-attributable costs of any mediator in connection with negotiations of a Multistate Settlement;
4. The Joint State Cost Fund shall seek to prioritize costs in the following order:
• litigation-related costs; then
• investigation-related costs; then
• settlement and negotiation related costs; then
• cost shares.
5. Costs incurred by a State’s outside counsel that the State is contractually obligated to reimburse shall be treated as costs incurred by a State.
6. As between similar categories of costs (e.g., defendant-specific litigation-related costs), the Joint State Cost Fund shall first reimburse costs incurred by a State’s outside counsel that the State is contractually obligated to reimburse out of its recovery, and then reimburse costs directly incurred by States.
7. The Joint State Cost Fund shall be available to reimburse only those costs which have not yet been reimbursed to a State from any other source, including any other fund set aside in a Multistate Settlement or bankruptcy plan for the reimbursement of costs or any individual T-4
state settlements.
8. The Joint State Cost Fund should not reimburse expenses that are expected to be reimbursed from another source, such as a bankruptcy debtor, unless such expected reimbursements do not come to fruition within a reasonable amount of time. This includes cost shares paid by states.
9. When coordinating among different state cost funds that each could be used to reimburse a given expense, the Joint State Cost Fund Committee may set guidelines to equitably distribute
reimbursements across all state cost funds in a manner that prioritizes costs unlikely to be otherwise reimbursed to a similarly situated State.
10. The Joint State Cost Fund may deny reimbursement of costs, on either an individual basis or a categorical basis, that a supermajority (75%+) of the Joint State Cost Fund Committee determines to be unreasonable.
11. After all costs identified in the foregoing have been reimbursed, the remaining funds in the Joint State Cost Fund shall be distributed to states in proportion to their allocation of remediation payments in the Mallinckrodt bankruptcy plan. Such distribution shall be treated as a reimbursement for States’ unenumerated costs of administering the Multistate Settlements and no subdivision shares shall be carved out of such disbursement, nor shall any attorney’s fees be assessed against such distribution (unless individually agreed to by a State). c. In applying the foregoing principles, the Joint State Cost Fund Committee shall have the discretion to vary their application in order to ensure equity among similarly situated states and to facilitate the ease and speed of administering the Joint State Cost Fund. The Joint State Cost Fund Committee may also apply percentages to approximate costs attributable to a particular Opioids Defendant (or categories of Opioids Defendants) in a manner that seeks to treat similarly situated states equitably. d. The Joint State Cost Fund Committee shall establish guidelines for the submission and approval of expenses eligible for reimbursement from the Joint State Cost Fund, which guidelines may be coordinated and consolidated with any similar cost funds in other state opioid settlements for purposes of joint administration and efficiency.
e. Unless waived by the Joint State Cost Fund Committee, the Joint State Cost T-5
Fund Administrator shall, in accordance with such guidelines, receive from Settling States records sufficient to demonstrate the incurrence and payment of each expense.
f. Where the Joint State Cost Fund Committee determines by a supermajority vote (75%+) that outside counsel for a Settling State has failed to exercise reasonable diligence in reviewing submitted costs for allowability, and such failure has resulted in the reimbursement of unallowed costs to such outside counsel, the Committee shall have the discretion to reduce or recover payments made to such outside counsel in an amount calculated to incentivize the exercise of reasonable diligence.
7. State Undertakings. Each State submitting for reimbursement of costs from the Joint State Cost Fund agrees:
a. to only submit costs allowable under this Joint State Cost Fund Agreement; b. to provide all back-up documentation that may be requested with respect to any submitted cost and to make itself available for any questions related to such costs;
c. to exercise reasonable diligence to ensure that all submitted costs are allowable under (i) this Joint State Cost Fund Agreement, (ii) the State’s contract with its outside counsel, if relevant, (iii) state law, and (iv) the policies and procedures applicable to the State’s retention of outside counsel, if relevant; and
d. to promptly return any excess payments made to the State or its outside counsel from the Joint State Cost Fund, including payments made for costs that were reimbursed from another source or are not allowable hereunder.
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CVS SETTLEMENT
AGREEMENT
WITH TECHNICAL CORRECTIONS 02.03.2023
i
TABLE OF CONTENTS
Page
I. Definitions............................................................................................................................2 II. Participation by States and Condition to Preliminary Agreement .....................................14 III. Injunctive Relief.................................................................................................................15 IV. Settlement Payments ..........................................................................................................16 V. Allocation and Use of Settlement Payments ......................................................................31 VI. Enforcement .......................................................................................................................38 VII. Participation by Subdivisions ............................................................................................43 VIII. Condition to Effectiveness of Agreement and Filing of Consent Judgment .....................46 IX. Additional Remediation .....................................................................................................46 X. Plaintiffs’ Attorneys’ Fees and Costs ................................................................................47 XI. Release ...............................................................................................................................47 XII. Later Litigating Subdivisions; Non-Settling States ...........................................................52 XIII. Miscellaneous ....................................................................................................................53 EXHIBIT A – Alleged Harms .................................................................................................... A-1 EXHIBIT B – Enforcement Committee Organization Bylaws ...................................................B-1 EXHIBIT C – Litigation Subdivision List ...................................................................................C-1 EXHIBIT D – [Intentionally Omitted] ....................................................................................... D-1 EXHIBIT E – List of Opioid Remediation Uses ......................................................................... E-1 EXHIBIT F – List of States and Allocation Percentages ............................................................ F-1 EXHIBIT G – Subdivisions Eligible to Receive Direct Allocations from the Subdivision Fund and Subdivision Fund Allocation Percentages ...................................................... G-1 EXHIBIT H – [Intentionally Omitted] ....................................................................................... H-1 EXHIBIT I – Primary Subdivisions .............................................................................................. I-1 EXHIBIT J – Illustrative List of Released Entities ...................................................................... J-1 WITH TECHNICAL CORRECTIONS 02.03.2023
ii
EXHIBIT K – Subdivision Participation Form and Release ...................................................... K-1 EXHIBIT L – Settlement Fund Administrator ............................................................................ L-1 EXHIBIT M – Maximum Payment Amounts ............................................................................. M-1 EXHIBIT N – Additional Remediation Amount Allocation Percentages .................................. N-1 EXHIBIT O – Adoption of a State-Subdivision Agreement ...................................................... O-1 EXHIBIT P – Injunctive Relief ................................................................................................... P-1 EXHIBIT Q – [Intentionally Omitted] ....................................................................................... Q-1 EXHIBIT R – Agreement on Attorneys’ Fees, Costs, and Expenses ..........................................R-1 EXHIBIT S – Agreement on the State Outside Counsel Fee Fund ............................................. S-1 EXHIBIT T – Agreement on the Joint State Cost Fund .............................................................. T-1 EXHIBIT U – IRS Form 1098-F ................................................................................................ U-1 EXHIBIT V – CVS Settlement Agreement Sign-on Form ......................................................... V-1 EXHIBIT W – Non-Litigating Threshold Subdivisions List ..................................................... W-1 EXHIBIT X – Governor’s Release of Opioid-Related Claims ................................................... X-1 WITH TECHNICAL CORRECTIONS 02.03.2023
1 CVS SETTLEMENT AGREEMENT
This Settlement Agreement, dated as of December 9, 2022 (the “Agreement”), sets forth the terms of settlement between and among the Settling States, CVS, and the Participating Subdivisions (as those terms are defined below). Upon satisfaction of the conditions set forth in Section II and Section VIII, this Agreement will be binding on all Settling States, Participating Subdivisions, and CVS. This Agreement will then be submitted for entry as part of Consent Judgments in the respective courts of each of the Settling States, pursuant to the terms set forth in Section VIII.
WHEREAS, certain States and Subdivisions have filed or could file Actions in various forums against CVS raising Claims or allegations concerning, related to, based upon, or in connection with the Alleged Harms and/or the Covered Conduct; WHEREAS, CVS (i) denies each and all of the Claims and allegations of wrongdoing made by the States and Litigating Subdivisions in each of the Actions and maintains that it has meritorious defenses; (ii) denies all assertions of wrongdoing or liability against CVS arising out of any of the conduct, statements, acts or omissions alleged, or that could have been alleged, in the Actions already brought or that could be brought by any State or Subdivision related to the Covered Conduct and/or Alleged Harms and contends that the factual allegations made in the current Actions relating to CVS are false and materially inaccurate; (iii) denies that any State, Subdivision, or resident thereof was harmed by any conduct of CVS; (iv) denies liability, denies any wrongdoing, and denies it violated any federal or state statute, regulation, or common law; and (v) maintains that CVS would be able to successfully defend against the Claims and allegations at trial, that the facts do not support the allegations, that CVS engaged in no misconduct or unlawful activity, and that CVS caused no harm to any State, Subdivision, or resident thereof; WHEREAS, the Parties have investigated the facts and analyzed the relevant legal issues regarding the Claims and defenses that have been or could have been asserted in the Actions; WHEREAS, the Parties have determined that it is preferable to resolve any Claims the States and Subdivisions may have through a cooperative and mutually beneficial settlement that provides funding to remediate Alleged Harms;
WHEREAS, the Parties have each considered the costs, delays and uncertainty associated with the continued prosecution and defense of the Actions; WHEREAS, the Parties believe the settlement set forth herein avoids the uncertainties of litigation and assures that the benefits reflected herein are obtained; WHEREAS, the States have concluded that the terms of the settlement are fair, reasonable and adequate and in the best interests of the States and all Subdivisions and citizens and residents of the States;
WHEREAS, the Parties have agreed to the terms herein for the sole purpose of settlement, and nothing herein may be taken as or construed to be an admission or concession of any violation WITH TECHNICAL CORRECTIONS 02.03.2023
2 of law, rule, or regulation, or of any other matter of fact or law, or of any liability or wrongdoing or lack thereof;
WHEREAS, no part of this Agreement, including its statements and commitments, shall constitute evidence of any liability, fault, or wrongdoing, or of any lack thereof; and WHEREAS, unless the contrary is expressly stated, this Agreement is not intended for use by any Party or any third party for any purpose not expressly stated herein, including submission to any court for any purpose other than Court approvals associated with this Agreement.
NOW, THEREFORE, IT IS HEREBY AGREED by and between the Settling States, Participating Subdivisions, and CVS, by and through their respective counsel, as follows:
I. Definitions
For all sections of this Agreement except Exhibit E and Exhibit P, the following definitions apply:
A. “Actions” means any lawsuit by a Settling State or Participating Subdivision asserting any Released Claim against one or more Released Entities.
B. “Additional Remediation Amount” means the amount available to the Settling States totaling up to $28,527,739.
C. “Advisory Committee” has the meaning set forth in Section V.E.2.d.
D. “Agreement” has the definition set forth in the preamble, including all exhibits.
E. “Alleged Harms” means the alleged past, present, and future financial and societal harms and related expenditures arising out of the alleged misuse and abuse of Products, nonexclusive examples of which are described in the documents listed on Exhibit A, including those expenditures that have allegedly arisen as a result of the physical and bodily injuries sustained by individuals suffering from opioid-related addiction, abuse, death, and other related diseases and disorders, and that have allegedly been caused by CVS.
F. “Allocation Statute” means a state law that governs allocation, distribution, and/or use of some or all of the Settlement Fund amounts allocated to that State and/or its Subdivisions.
In addition to modifying the allocation as set forth in Section V.D.2, an Allocation Statute may, without limitation, contain a Statutory Trust, further restrict expenditures of funds, form an advisory committee, establish oversight and reporting requirements, or address other default provisions and other matters related to the funds. An Allocation Statute is not required to address all three (3) types of funds comprising the Settlement Fund or all default provisions.
G. “Annual Payment” means the total amount payable to the Settlement Fund Administrator by CVS on the Payment Date each year, as calculated by the Settlement Fund Administrator pursuant to Section IV.C.3. For the avoidance of doubt, this term does not include the Additional Remediation Amount, amounts paid pursuant to Section X, amounts paid for the WITH TECHNICAL CORRECTIONS 02.03.2023
3 cost of the Settlement Fund Administrator pursuant to Section V.C.4, or amounts paid for the cost of the Implementation Administrator pursuant to Section VIII.A.
H. “Appropriate Official” has the meaning set forth in Section XIII.F.3.
I. “Base Payment” has the meaning set forth in Section IV.G.
J. “Bankruptcy Code” means Title 11 of the United States Code, 11 U.S.C. §§ 101, et seq.
K. “Bar” means either: (1) a law barring Subdivisions in a State from maintaining Released Claims against Released Entities (either through a direct bar or through a grant of authority to release claims and the exercise of such authority in full); or (2) a ruling by the highest court of the State (or, in a State with a single intermediate court of appeals, the intermediate court of appeals when not subject to further review by the highest court of the State) setting forth the general principle that Subdivisions in the State may not maintain any Released Claims against Released Entities, whether on the ground of this Agreement (or the release in it) or otherwise. For the avoidance of doubt, a law or ruling that is conditioned or predicated upon payment by a Released Entity (apart from payments made by CVS under this Agreement) shall not constitute a Bar.
L. “Case-Specific Resolution” means either: (1) a law barring the Subdivision at issue from maintaining any Released Claims against any Released Entities (either through a direct bar or through a grant of authority to release claims and the exercise of such authority in full); or (2) a ruling by a court of competent jurisdiction over the Subdivision at issue that the Subdivision may not maintain any Released Claims at issue against any Released Entities, whether on the ground of this Agreement (or the release in it) or otherwise. For the avoidance of doubt, a law or ruling that is conditioned or predicated upon payment by a Released Entity (apart from payments made by CVS under this Agreement) shall not constitute a Case-Specific Resolution.
M. “Claim” means any past, present or future cause of action, claim for relief, crossclaim or counterclaim, theory of liability, demand, derivative claim, request, assessment, charge, covenant, damage, debt, lien, loss, penalty, judgment, right, obligation, dispute, suit, contract, controversy, agreement, parens patriae claim, promise, performance, warranty, omission, or grievance of any nature whatsoever, whether legal, equitable, statutory, regulatory or administrative, whether arising under federal, state or local common law, statute, regulation, guidance, ordinance or principles of equity, whether filed or unfiled, whether asserted or unasserted, whether known or unknown, whether accrued or unaccrued, whether foreseen, unforeseen or unforeseeable, whether discovered or undiscovered, whether suspected or unsuspected, whether fixed or contingent, and whether existing or hereafter arising, in all such cases, including but not limited to any request for declaratory, injunctive, or equitable relief, compensatory, punitive, or statutory damages, absolute liability, strict liability, restitution, abatement, subrogation, contribution, indemnity, apportionment, disgorgement, reimbursement, attorney fees, expert fees, consultant fees, fines, penalties, expenses, costs or any other legal, equitable, civil, administrative, or regulatory remedy whatsoever.
WITH TECHNICAL CORRECTIONS 02.03.2023
4 N. “Claim-Over” means a Claim asserted by a Non-Released Entity against a Released Entity on the basis of contribution, indemnity, or other claim-over on any theory relating to a NonParty Covered Conduct Claim asserted by a Releasor.
O. “Consent Judgment” means a state-specific consent judgment in a form to be agreed by the Settling States and CVS prior to the Initial Subdivision Participation Date that, among other things, (1) approves this Agreement and (2) provides for the release set forth in Section XI.A, including the dismissal with prejudice of any Released Claims that the Settling State has brought against Released Entities.
P. “Covered Conduct” means any actual or alleged act, failure to act, negligence, statement, error, omission, breach of any duty, conduct, event, transaction, agreement, misstatement, misleading statement or other activity of any kind whatsoever from the beginning of time through the Effective Date (and any past, present or future consequence of any such act, failure to act, negligence, statement, error, omission, breach of duty, conduct, event, transaction, agreement, misstatement, misleading statement or other activity) in any line of business arising from or relating in any way to: (1) the distribution, dispensing, delivery, monitoring, reporting, supply, sale, prescribing, physical security, warehousing, coverage, purchases, reimbursement, discovery, development, manufacture, packaging, repackaging, marketing, promotion, advertising, labeling, recall, withdrawal, and/or any similar act or failure to act related to any Product; the use and/or abuse of any Product; orders, prescriptions, formularies, guidelines, payments and/or rebates for any Product; policies, practices and/or operating procedures, statements, contracts, commercial arrangements, insurance, claim and/or benefit administration, claim adjudication, plan design, data and/or sales thereof, and/or any similar act or failure to act relating to any Product; and/or any system, plan, policy and/or advocacy relating to any Product, including but not limited to unbranded promotion, marketing, programs, and/or campaigns related to any Product and/or class of Products; (2) the characteristics, properties, risks and/or benefits of any Product; (3) the reporting, disclosure, non-reporting and/or non-disclosure to federal, state and/or other regulators of orders and/or prescriptions, theft, diversion and/or any similar conduct related to any Product; (4) the purchasing, selling, acquiring, disposing of, importing, exporting, handling, processing, packaging, supplying, distributing, and/or converting any Product; and (5) controls against diversion, corresponding responsibility, and/or suspicious order monitoring related to any Product.
Q. “CVS” means CVS Health Corporation and CVS Pharmacy, Inc. and all of their past and present direct and indirect parents and subsidiaries. For the avoidance of doubt, this definition shall not in any way limit the definition of Released Entities.
R. “Designated State” means New York.
S. “Effective Date” means fifteen (15) calendar days after the Reference Date.
T. “Eligible State” means the states, commonwealths, and territories of the United States of America, but excluding Florida, New Mexico, and West Virginia. Eligible States are listed in Exhibit F-2. The use of non-capitalized “state” to describe something (e.g., “state court”) shall also be read to include parallel entities in commonwealths, territories, and the District of Columbia (e.g., “territorial court”).
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5 U. “Enforcement Committee” means a committee consisting of certain representatives of the Settling States and of the Participating Subdivisions selected and operating pursuant to the organizational bylaws set forth at Exhibit B. Notice pursuant to Section XIII.Q shall be provided when there are changes in membership or contact information.
V. “Final Order” means an order or judgment of a court of competent jurisdiction with respect to the applicable subject matter (1) which has not been reversed or superseded by a modified or amended order, is not currently stayed, and as to which any right to appeal or seek certiorari, review, reargument, stay, or rehearing has expired, and as to which no appeal or petition for certiorari, review, reargument, stay, or rehearing is pending, or (2) as to which an appeal has been taken or petition for certiorari, review, reargument, stay, or rehearing has been filed and (a) such appeal or petition for certiorari, review, reargument, stay, or rehearing has been resolved by the highest court to which the order or judgment was appealed or from which certiorari, review, reargument, stay, or rehearing was sought, or (b) the time to appeal further or seek certiorari, review, reargument, stay, or rehearing has expired and no such further appeal or petition for certiorari, review, reargument, stay, or rehearing is pending.
W. “Global Settlement Amount” means the sum of (a) the Maximum Remediation Payment, (b) the Additional Remediation Amount, and (c) any attorneys’ fees and costs set forth in Exhibit R, Exhibit S and Exhibit T.
X. “Implementation Administrator” means the vendor agreed to by CVS and the Enforcement Committee and retained by CVS to provide notice pursuant to Section VII.A and to manage the initial joinder period for Subdivisions, including the issuance and receipt of Subdivision Participation Agreements.
Y. “Incentive C Eligible Subdivisions” has the meaning set forth in Section IV.H.8.e.
Z. “Incentive A” and “Incentive Payment A” mean the incentive payment described in Section IV.H.6.
AA. “Incentive B” and “Incentive Payment B” mean the incentive payment described in Section IV.H.7.
BB. “Incentive C” and “Incentive Payment C” mean the incentive payment described in Section IV.H.8.
CC. “Incentive Payment D” means the incentive payment described in Section IV.H.9.
DD. “Incentive Payment D Look-Back Dates” has the meaning set forth in Section IV.H.9.d.
EE. “Initial Participating Subdivision” means a Subdivision that meets the requirements set forth in Section VII.D.
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6 FF. “Initial Subdivision Participation Date” means ninety (90) calendar days after the Preliminary Agreement Date, unless it is extended by written agreement of CVS and the Enforcement Committee.
GG. “Injunctive Relief Terms” means the terms described in Section III and set forth in Exhibit P.
HH. “Later Litigating Subdivision” means a Subdivision (or Subdivision official asserting the right of or for the Subdivision to recover for Alleged Harms to the Subdivision and/or the people thereof) that: (1) first files a lawsuit bringing a Released Claim against a Released Entity after the Initial Subdivision Participation Date; or (2) adds a Released Claim against a Released Entity after the Initial Subdivision Participation Date to a lawsuit brought before the Initial Subdivision Participation Date that, prior to the Initial Subdivision Participation Date, did not include any Released Claims against a Released Entity; or (3) (a) was a Litigating Subdivision whose Released Claims against Released Entities were resolved by a legislative Bar or legislative Case-Specific Resolution as of the Initial Subdivision Participation Date, (b) such legislative Bar or legislative Case-Specific Resolution is subject to a Revocation Event after the Initial Subdivision Participation Date, and (c) the earlier of the date of completion of opening statements in a trial in an action brought by a Subdivision in that Settling State that includes a Released Claim against a Released Entity or one hundred eighty (180) days from the Revocation Event passes without a Bar or Case-Specific Resolution being implemented as to that Litigating Subdivision or the Litigating Subdivision’s Released Claims being dismissed; or (4) (a) was a Litigating Subdivision whose Released Claims against Released Entities were resolved by a judicial Bar or judicial Case-Specific Resolution as of the Initial Subdivision Participation Date, (b) such judicial Bar or judicial Case-Specific Resolution is subject to a Revocation Event after the Initial Subdivision Participation Date, and (c) such Litigating Subdivision takes any action in its lawsuit asserting a Released Claim against a Released Entity other than seeking a stay or dismissal.
II. “Later Participating Subdivision” means a Participating Subdivision that is not an Initial Participating Subdivision, but meets the requirements set forth in Section VII.E.
JJ. “Litigating Subdivisions” means all Subdivisions that have brought any Released Claim against any Released Entities as of the Initial Subdivision Participation Date. Attached as Exhibit C is a list of the Litigating Subdivisions in each Eligible State. Exhibit C will be updated (including with any corrections) periodically, and a final version of Exhibit C will be attached hereto as of the Initial Subdivision Participation Date.
KK. “Maximum Remediation Payment” means $4,279,160,837, the total amount available to Eligible States for Annual Payments as set forth in Exhibit M-1.1 The actual amount paid for Annual Payments is subject to reduction from the Maximum Remediation Payment for 1 The total maximum amount of this settlement is up to $5,022,083,578, which includes (i) up to $4,279,160,837 in the Maximum Remediation Payment; (ii) up to $539,457,124 in Common Benefit and Subdivision Attorneys’ Fees, Expenses and Costs; (iii) up to $85,583,217 in the State Outside Counsel Fee Fund, State Cost Fund and Additional Remediation Amount; (iv) a credit of $117,882,400 for CVS’s settlements with the state of New Mexico, state of West Virginia, and Nassau County and Suffolk County of New York. In no event shall CVS’s payment obligation under this Agreement exceed the sum of (i)-(iii) above ($4,904,201,178).
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7 Non-Settling States, unachieved incentive payments, and as otherwise set forth in this Agreement.
In no event shall CVS’s total Annual Payments under this Agreement ever exceed the Maximum Remediation Payment.
LL. “Maximum Annual Remediation Payments” means the total amount available to Eligible States for Annual Payments in each Payment Year as set forth in the “Total Remediation” column of Exhibit M-1. In no event shall an Annual Payment in Payment Years 1-5 exceed the Maximum Annual Remediation Payment for that Payment Year set forth in Exhibit M-1. For Payment Years 6-10, the Annual Payment may exceed the Maximum Annual Remediation Payment for that Payment Year only to the extent needed for Incentive Payment D for a Settling State that has not earned some or all Incentive Payment C in prior Payment Years, having resulted in correspondingly lower Annual Payments in those prior Payment Years. In no event shall an Annual Payment in Payment Years 6-10 exceed the range set forth in Exhibit M-2 for that Payment Year. For the avoidance of doubt, in no event shall the Annual Payments in Payment Years 6-10 cause CVS’s total Annual Payments to exceed the Maximum Remediation Payment.
MM. “National Arbitration Panel” means the panel comprised as described in Section VI.F.3.b.
NN. “National Disputes” has the meaning set forth in Section VI.F.3.a.
OO. “Non-Litigating Subdivision” means any Subdivision that is neither a Litigating Subdivision nor a Later Litigating Subdivision.
PP. “Non-Litigating Threshold Subdivision” means (a) all Primary Subdivisions with populations equal to or greater than 30,000 that have not brought a Released Claim against any Released Entity as of the Initial Subdivision Participation Date and (b) any other Primary Subdivisions with populations between 10,000 and 30,000 that have not brought a Released Claim against any Released Entity but have brought a claim related to Products, including any Claims related to the Covered Conduct and/or Alleged Harms, against McKesson, AmerisourceBergen, Cardinal Health, Janssen Pharmaceuticals, or any parents, subsidiaries, divisions, predecessors, successors, and assigns of McKesson, AmerisourceBergen, Cardinal Health, or Janssen Pharmaceuticals. Attached as Exhibit W is a list of the Non-Litigating Threshold Subdivisions in each Eligible State. Exhibit W will be updated (including with any corrections) periodically, and a final version of Exhibit W will be attached hereto as of the Initial Subdivision Participation Date.
QQ. “Non-Participating Subdivision” means any Subdivision that is not a Participating Subdivision.
RR. “Non-Party Covered Conduct Claim” means a Claim against any Non-Released Entity involving, arising out of, or related to Alleged Harms and/or Covered Conduct (or conduct that would be Covered Conduct if engaged in by a Released Entity).
SS. “Non-Party Settlement” means a settlement by any Releasor that settles any NonParty Covered Conduct Claim and includes a release of any Non-Released Entity.
TT. “Non-Released Entity” means an entity that is not a Released Entity.
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8 UU. “Non-Settling State” means any Eligible State that is not a Settling State.
VV. “Opioid Remediation” means care, treatment, and other programs and expenditures (including reimbursement for past such programs or expenditures2 except where this Agreement restricts the use of funds solely to future Opioid Remediation) designed to remediate Alleged Harms, including to (1) address the misuse and abuse of opioid products, (2) treat or mitigate opioid use or related disorders, or (3) mitigate other alleged effects of, including on those injured as a result of, the opioid epidemic. Exhibit E provides a non-exhaustive list of expenditures that qualify as being paid for Opioid Remediation. Qualifying expenditures may include reasonable related administrative expenses.
WW. “Opioid Tax” means any tax, assessment, surcharge or any other fee (other than a fixed prospective excise tax or similar tax or fee that has no restriction on pass-through) imposed by a Settling State on a pharmacy’s ordering or dispensing of opioid products. For the avoidance of doubt, an Opioid Tax shall not include a fee that a retail pharmacy pays to become registered or licensed to operate as a retail pharmacy or to dispense controlled substances in a Settling State, or to renew such a registration or license in a Settling State.
XX. “Overall Allocation Percentage” means a Settling State’s percentage as set forth in Exhibit F-2. For the avoidance of doubt, the aggregate Overall Allocation Percentage of all Eligible States (including Settling States and Non-Settling States) shall equal one hundred percent (100%).
YY. “Participating Subdivision” means any Subdivision in a Settling State that joins the Agreement and meets the requirements for becoming a Participating Subdivision under Section VII.B or Section VII.C, as applicable.
ZZ. “Participation Percentage of Incentive C Eligible Subdivision Population” has the meaning set forth in Section IV.H.8.d.
AAA. “Participation Percentage of Litigating Subdivision Population” has the meaning set forth in Section IV.H.7.d.
BBB. “Parties” means CVS and the Settling States (each, a “Party”).
CCC. “Payment Year” means the calendar year during which the applicable Annual Payment is due pursuant to Section IV.B. Payment Year 1 is 2023, Payment Year 2 is 2024 and so forth. References to payment “for a Payment Year” mean the Annual Payment due during that year. References to eligibility “for a Payment Year” mean eligibility for Annual Payment during that year.
DDD. “Preliminary Agreement Date” has the meaning set forth in Section II.C.
EEE. “Primary Fire District” means a fire district that covers a population of 25,000, or
0.20% of an Eligible State’s population if an Eligible State’s population is greater than 18 million. 2 Reimbursement includes amounts paid to any governmental entities for past expenditures or programs.
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9 If not easily calculable from state data sources and agreed to between the Eligible State and CVS, a fire district’s population is calculated by dividing the population of the county or counties a fire district serves by the number of fire districts in the county or counties. “Primary Fire Districts” shall mean fire districts as identified in connection with the implementation of the July 21, 2021 Janssen Settlement Agreement.
FFF. “Primary Subdivision” means any General-Purpose Government (including, but not limited to, a municipality, county, county subdivision, city, town, township, parish, village, borough, gore, or any other entities that provide municipal-type government) with a population over 10,000. Attached as Exhibit I is an agreed list of the Primary Subdivisions in each Eligible State.
GGG. “Prior Litigating Subdivision” means a Subdivision (or Subdivision official) that brought any Released Claim against any Released Entity prior to the Initial Subdivision Participation Date and all such Released Claims were separately settled or finally adjudicated prior to the Initial Subdivision Participation Date; provided, however, that if the final adjudication was pursuant to a Bar, such Subdivision shall not be considered a Prior Litigating Subdivision.
Notwithstanding the prior sentence, CVS and the Settling State of the relevant Subdivision may agree in writing that the Subdivision shall not be considered a Prior Litigating Subdivision.
HHH. “Product” means any chemical substance, whether licit or illicit, whether used for medicinal or non-medicinal purposes, and whether natural, synthetic, or semi-synthetic, or any finished pharmaceutical product made from or with such substance, that is (1) an opioid or opiate, as well as any product containing any such substance; (2) a benzodiazepine, a muscle relaxer, carisoprodol, zolpidem, or gabapentin; or (3) a combination or “cocktail” of any stimulant or other chemical substance prescribed, sold, bought, or dispensed to be used together that includes opioids or opiates. “Product” shall include, but is not limited to, any substance consisting of or containing buprenorphine, codeine, fentanyl, hydrocodone, hydromorphone, meperidine, methadone, morphine, oxycodone, oxymorphone, tapentadol, tramadol, opium, heroin, carfentanil, diazepam, estazolam, quazepam, alprazolam, clonazepam, oxazepam, flurazepam, triozolam, temazepam, midazolam, carisoprodol, gabapentin, or any variant of these substances or any similar substance.
Notwithstanding the foregoing, nothing in this section prohibits a Settling State from taking administrative or regulatory action related to a benzodiazepine (including, but not limited to, diazepam, estazolam, quazepam, alprazolam, clonazepam, oxazepam, flurazepam, triozolam, temazepam, and midazolam), a muscle relaxer, carisoprodol, zolpidem, or gabapentin that is wholly independent from the use of such drugs in combination with opioids, provided such action does not seek money (including abatement and/or remediation) for conduct prior to the Effective Date.
III. “Reference Date” means the date on which CVS is to provide notice to the Settling States and the Enforcement Committee of its determination whether to proceed with this Agreement as required by Section VIII.B. The Reference Date shall be no later than thirty (30) days after the Initial Subdivision Participation Date, unless it is extended by the written agreement of CVS and the Enforcement Committee.
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10 JJJ. “Released Claims” means any and all Claims that directly or indirectly are based on, arise out of, or in any way relate to or concern Covered Conduct and/or Alleged Harms occurring prior to the Initial Subdivision Participation Date. Without limiting the foregoing, “Released Claims” include any Claims that have been asserted against the Released Entities by any Settling State or any of its Litigating Subdivisions or Litigating Special Districts in any federal, state or local action or proceeding (whether judicial, arbitral, or administrative) based on, arising out of or relating to, in whole or in part, the Covered Conduct and/or Alleged Harms, or any such Claims that could be or could have been asserted now or in the future in those actions or in any comparable action or proceeding brought by a State, any of its Subdivisions or Special Districts, or any Releasors (whether or not such State, Subdivision, Special District, or Releasor has brought such action or proceeding). Released Claims also include all Claims asserted in any proceeding to be dismissed pursuant to the Agreement, whether or not such claims relate to Covered Conduct and/or Alleged Harms. The Parties intend that “Released Claims” be interpreted broadly. This Agreement does not release Claims by private individuals. It is the intent of the Parties that the use and/or effect of this Agreement in connection with Claims by private individuals be treated in accordance with applicable law. Released Claims is also used herein to describe Claims brought by a Later Litigating Subdivision or other non-party Subdivision that would have been Released Claims if they had been brought by a Releasor against a Released Entity.
KKK. “Released Entities” means CVS and (1) all of CVS’s past and present direct or indirect parents, subsidiaries, divisions, predecessors, successors, and assigns; (2) the past and present direct or indirect parents, subsidiaries, divisions, predecessors, successors, assigns, and joint ventures of any of the foregoing; (3) all of CVS’s insurers (solely in their role as insurers with respect to the Released Claims); (4) all of CVS’s, or of any entity described in subsection (1), past and present joint ventures; and (5) the respective past and present officers, directors, members, shareholders (solely in their capacity as shareholders of the foregoing entities), partners, trustees, and employees of any of the foregoing (for actions that occurred during and related to their work for, or employment with, CVS). Any person or entity described in subsections (3)-(5) shall be a Released Entity solely in the capacity described in such clause and shall not be a Released Entity with respect to its conduct in any other capacity. For the avoidance of doubt, any joint venture partner of a joint venture in subsection (2) or (4) is not a Released Entity unless such entity independently falls within subsections (1)-(5) above. An illustrative list of CVS’s present joint ventures, subsidiaries, affiliates and predecessor entities is set forth in Exhibit J. With respect to joint ventures (including predecessor entities), only entities listed on Exhibit J are Released Entities. Current or former defendants in In re: National Prescription Opiate Litigation, No. 1:17- md-2804 (N.D. Ohio) (“MDL”) (or in other pending litigation asserting a Claim for Covered Conduct, as identified in the “National Opiate Litigation – Case and Defendant Extract” provided to CVS by the Plaintiffs’ Executive Committee on November 22, 2022) not identified in Exhibit J are not considered Released Entities, provided, however, that any CVS entities that fall within clauses (1)-(5) above against whom Released Claims are brought in the MDL on or after December 9, 2022 shall be considered Released Entities even if not listed on Exhibit J. For the avoidance of doubt, any entity acquired, or joint venture entered into, by CVS before the Initial Subdivision Participation Date is a Released Entity, but any entity acquired, or joint venture entered into, by CVS after the Initial Subdivision Participation Date is not a Released Entity.
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11 LLL. “Releasors” means (1) each Settling State; (2) each Participating Subdivision; and (3) without limitation and to the maximum extent of the power of each Settling State’s Attorney General and/or Participating Subdivision to release Claims, (a) the Settling State’s and Participating Subdivision’s departments, agencies, divisions, boards, commissions, Subdivisions, districts, instrumentalities of any kind and attorneys, including its Attorney General, and any person in their official capacity whether elected or appointed to serve any of the foregoing and any agency, person, or other entity claiming by or through any of the foregoing, (b) any public entities, public instrumentalities, public educational institutions, unincorporated districts, fire districts, irrigation districts, water districts, law enforcement districts, emergency services districts, school districts, hospital districts and other Special Districts in a Settling State, and (c) any person or entity acting in a parens patriae, sovereign, quasi-sovereign, private attorney general, qui tam, taxpayer, or other capacity seeking relief on behalf of or generally applicable to the general public with respect to a Settling State or Subdivision in a Settling State, whether or not any of them participate in the Agreement. The inclusion of a specific reference to a type of entity in this definition shall not be construed as meaning that the entity is not a Subdivision. Each Settling State’s Attorney General represents that he or she has or has obtained (or will obtain no later than the Initial Subdivision Participation Date) the authority set forth in Section XI.G. In addition to being a Releasor as provided herein, a Participating Subdivision shall also provide the Subdivision Participation Agreement referenced in Section VII providing for a release to the fullest extent of the Participating Subdivision’s authority.
MMM.“Remediation Accounts Fund” means the component of the Settlement Fund described in Section V.E.
NNN. “Revocation Event” means, with respect to a Bar, Settlement Class Resolution, or Case-Specific Resolution, a revocation, rescission, reversal, overruling, or interpretation that in any way limits the effect of such Bar, Settlement Class Resolution, or Case-Specific Resolution on Released Claims, or any other action or event that otherwise deprives the Bar, Settlement Class Resolution, or Case-Specific Resolution of force or effect in any material respect.
OOO. “Settlement Class Resolution” means a class action resolution in a court of competent jurisdiction in a Settling State (that is not successfully removed to federal court) with respect to a class of Subdivisions in that Settling State that (1) conforms with that Settling State’s statutes, case law, and rules of procedure regarding class actions; (2) is approved and entered as an order of a court of competent jurisdiction in that Settling State and such order has become a Final Order; (3) is binding on all Non-Participating Subdivisions in that Settling State (other than opt outs as permitted under the next sentence); (4) provides that all such Non-Participating Subdivisions may not bring any Released Claims against any Released Entities, whether on the ground of this Agreement (or the releases herein) or otherwise; and (5) does not impose any costs or obligations on CVS other than those provided for in this Agreement, or contain any provision inconsistent with any provision of this Agreement. If applicable state law requires that opt-out rights be afforded to members of the class, a class action resolution otherwise meeting the foregoing requirements shall qualify as a Settlement Class Resolution unless Subdivisions collectively representing more than one percent (1%) of the total population of that Settling State opt out. In seeking certification of any Settlement Class, the applicable Settling State and Participating Subdivisions shall make clear that certification is sought solely for settlement WITH TECHNICAL CORRECTIONS 02.03.2023
12 purposes and shall have no applicability beyond approval of the settlement for which certification is sought. Nothing in this Agreement constitutes an admission by any Party that class certification would be appropriate for litigation purposes in any case or for purposes unrelated to this Agreement.
PPP. “Settlement Fund” means the interest-bearing fund established pursuant to this Agreement into which the payment under Section IV is made. The Settlement Fund is comprised of the Remediation Accounts Fund, State Fund, and Subdivision Fund.
QQQ. “Settlement Fund Administrator” means the entity that determines the payments and reversions due under Section IV and Section IX, including annually determining the Payout Amount and calculating incentive payments, administers the Settlement Fund, and distributes amounts into three sub-funds (the Remediation Accounts Fund, State Fund, and Subdivision Fund) pursuant to this Agreement. The duties of the Settlement Fund Administrator shall be governed by this Agreement. Prior to the Initial Subdivision Participation Date, CVS and the Enforcement Committee shall agree to selection and removal processes for and the identity of the Settlement Fund Administrator, and a detailed description of the Settlement Fund Administrator’s duties and responsibilities, including a detailed mechanism for paying the Settlement Fund Administrator’s fees and costs, all of which shall be appended to the Agreement as Exhibit L.
RRR. “Settling State” means an Eligible State that has entered into this Agreement with CVS and delivers an executed State Participation Form and executed releases in accordance with Section II.A.
SSS. “State Global Allocation Percentage” means the allocation percentages for all States as set forth in Exhibit F-1, which represents allocations before adjusting for States that are not Eligible States due to prior settlements with CVS (Florida, New Mexico, and West Virginia).
TTT. “State Fund” means the component of the Settlement Fund described in Section V.C.
UUU. “State Participation Form” means the form attached as Exhibit V.
VVV. “State Participation Date” has the meaning set forth in Section II.A.
WWW. “State-Subdivision Agreement” means an agreement that a Settling State reaches with the Subdivisions in that Settling State regarding the allocation, distribution, and/or use of funds allocated to that Settling State and to its Subdivisions. A State-Subdivision Agreement shall be effective if approved pursuant to the provisions of Exhibit O or if adopted by statute. Preexisting agreements addressing funds other than those allocated pursuant to this Agreement shall qualify if the approval requirements of Exhibit O are met. A Settling State and its Subdivisions may revise a State-Subdivision Agreement if approved pursuant to the provisions of Exhibit O, or if such revision is adopted by statute.
XXX. “Statewide Payment Amount” means the amount from an Annual Payment to be paid to a Settling State, its separate types of funds (if applicable), and its Participating Subdivision listed on Exhibit G.
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13 YYY. “Statutory Trust” means a trust fund established by state law to receive funds allocated to a Settling State’s Remediation Accounts Fund and restrict any expenditures made using funds from such Settling State’s Remediation Accounts Fund to Opioid Remediation, subject to reasonable administrative expenses. A Settling State may give a Statutory Trust authority to allocate one (1) or more of the three (3) types of funds comprising such State’s Settlement Fund, but this is not required.
ZZZ. “Subdivision” means any (1) General-Purpose Government (including, but not limited to, a municipality, county, county subdivision, city, town, township, parish, village, borough, gore, or any other entities that provide municipal-type government), School District, or Special District within a Settling State, and (2) any other subdivision, subdivision official (acting in an official capacity on behalf of the subdivision) or sub-entity of or located within a Settling State (whether political, geographical or otherwise, whether functioning or non-functioning, regardless of population overlap, and including, but not limited to, nonfunctioning governmental units and public institutions) that has filed a lawsuit that includes a Released Claim against a Released Entity in a direct, parens patriae, or any other capacity. “General-Purpose Government,” “School District,” and “Special District” shall correspond to the “five basic types of local governments” recognized by the U.S. Census Bureau and match the 2017 list of Governmental Units.3 The three (3) General-Purpose Governments are county, municipal, and township governments; the two (2) special purpose governments are School Districts and Special Districts.4 The terms “Fire District,” “Health District,” “Hospital District,” and “Library District” shall correspond to categories of Special Districts recognized by the U.S. Census Bureau.5 References to a Settling State’s Subdivisions or to a Subdivision “in,” “of,” or “within” such Settling State include Subdivisions located within the Settling State even if they are not formally or legally a sub-entity of such Settling State; provided, however, that a “health district” that includes any of the following words or phrases in its name shall not be considered a Subdivision: mosquito, pest, insect, spray, vector, animal, air quality, air pollution, clean air, coastal water, tuberculosis, and sanitary.
AAAA. “Subdivision Allocation Percentage” means the portion of a Settling State’s Subdivision Fund set forth in Exhibit G that a Subdivision will receive pursuant to Section V.C or Section V.D if it becomes a Participating Subdivision. The aggregate Subdivision Allocation Percentage of all Subdivisions receiving a Subdivision Allocation Percentage in each State shall equal one hundred percent (100%). Immediately upon the effectiveness of any State-Subdivision 3 https://www.census.gov/data/datasets/2017/econ/gus/public-use-files.html. 4 E.g., U.S. Census Bureau, “Technical Documentation: 2017 Public Use Files for State and Local Government Organization” at 7 (noting that “the Census Bureau recognizes five basic types of local governments,” that three of those are “general purpose governments” (county governments, municipal governments, and township governments), and that the other two are “school district and special district governments”), https://www2.census.gov/programssurveys/gus/datasets/2017/2017_gov_org_meth_tech_doc.pdf. 5 A list of 2017 Government Units provided by the Census Bureau identifies 38,542 Special Districts and categorizes them by “FUNCTION_NAME.” “Govt_Units_2017_Final” spreadsheet, “Special District” sheet, included in “Independent Governments - list of governments with reference information,” https://www.census.gov/data/datasets/2017/econ/gus/public-use-files.html. As used herein, “fire district” corresponds to Special District function name “24 – Local Fire Protection,” “Health District” corresponds to Special District function name “32 – Health,” “Hospital District” corresponds to Special District function name “40 – Hospitals,” and “Library District” corresponds to Special District function name “52 – Libraries.” See id.
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14 Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3 (or upon the effectiveness of an amendment to any State-Subdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3) that addresses allocation from the Subdivision Fund, whether before or after the Initial Subdivision Participation Date, Exhibit G will automatically be amended to reflect the allocation from the Subdivision Fund pursuant to the State-Subdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3. The Subdivision Allocation Percentages contained in Exhibit G may not change once notice is distributed pursuant to Section VII.A, except upon the effectiveness of any State-Subdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3 (or upon the effectiveness of an amendment to any State-Subdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3) that addresses allocation from the Subdivision Fund. For the avoidance of doubt, no Subdivision not listed on Exhibit G shall receive an allocation from the Subdivision Fund and no provision of this Agreement shall be interpreted to create such an entitlement.
BBBB. “Subdivision Fund” means the component of the Settlement Fund described in Section V.C.
CCCC.“Subdivision Participation Agreement” means the form of agreement attached as Exhibit K that Participating Subdivisions must execute and return to the Implementation Administrator or Settlement Fund Administrator.
DDDD. “Threshold Motion” means a motion to dismiss or equivalent dispositive motion made at the outset of litigation under applicable procedure. A Threshold Motion must include as potential grounds for dismissal any applicable Bar or the relevant release by a Settling State or Participating Subdivision provided under this Agreement and, where appropriate under applicable law, any applicable limitations defense.
EEEE. “Total Remediation Amount” means the aggregate amount paid or incurred by CVS hereunder other than amounts paid as attorneys’ fees and costs or identified pursuant to Section V.B.2 as being used to pay attorneys’ fees, investigation costs or litigation costs.
II. Participation by States and Condition to Preliminary Agreement A. Notice to States. On December 9, 2022, this Agreement shall be distributed to all Eligible States by the Enforcement Committee. The Eligible States’ Attorneys General shall then have until December 31, 2022 (the “State Participation Date”), to decide whether to become Settling States. Eligible States that determine to become Settling States shall sign a State Participation Form, in the form attached as Exhibit Y, and provide it to CVS and the Enforcement Committee on or before the State Participation Date. The State Participation Date may be extended by the written agreement of CVS and the Enforcement Committee.
B. Condition to Preliminary Agreement—Settling States’ Determination to Proceed.
Following the State Participation Date, the Settling States on the Enforcement Committee shall determine whether enough Eligible States have agreed to become Settling States to proceed with notice to Subdivisions as set forth in Section VII below. The Settling States shall have full, unfettered, and unilateral discretion to abandon the Agreement, without prejudice, should they WITH TECHNICAL CORRECTIONS 02.03.2023
15 determine, based on any criteria or factors they deem relevant, that the Eligible State participation level is insufficient. Within seven (7) calendar days after the State Participation Date, the Settling States shall provide notice to CVS and the Enforcement Committee whether they intend to proceed with the Agreement. Should the Settling States give notice of insufficient Eligible State participation and elect not to proceed, then this Agreement shall have no further effect and all releases, payment obligations, and other commitments or obligations contained herein shall be void.
C. Condition to Preliminary Agreement—CVS’s Determination to Proceed. If the Settling States elect to proceed, then CVS shall determine whether enough Eligible States have agreed to become Settling States to proceed with notice to Subdivisions as set forth in Section VII below. CVS shall have full, unfettered, and unilateral discretion to abandon the Agreement, without prejudice, should it determine, based on any criteria or factors it deems relevant, that the Eligible State participation level is insufficient. Within seven (7) calendar days after receiving notice of the Settling States’ election to proceed pursuant to Section II.B, CVS shall provide notice to the Settling States and the Enforcement Committee whether it intends to proceed with the Agreement. Should CVS give notice of sufficient Eligible State participation and elect to proceed, the date of the notice shall be the Preliminary Agreement Date. Should CVS give notice of insufficient Eligible State participation and elect not to proceed, then this Agreement shall have no further effect and all releases, payment obligations, and other commitments or obligations contained herein shall be void.
D. Later Joinder by States. Should the Settling States and CVS elect to proceed with the Agreement, then an Eligible State may become a Settling State after the Preliminary Agreement Date only with the consent of CVS, in its sole discretion. If an Eligible State becomes a Settling State more than sixty (60) calendar days after the Preliminary Agreement Date, but on or before May 31, 2023, then the Subdivisions in that Eligible State that become Participating Subdivisions within ninety (90) calendar days of that Eligible State becoming a Settling State shall be considered Initial Participating Subdivisions. An Eligible State may not become a Settling State after May 31, 2023.
E. Litigation Activity. Following the State Participation Date, Eligible States that determine to become Settling States shall make reasonable efforts to cease all litigation activity against the Released Entities, including by jointly seeking stays or severance of Claims against Released Entities, where feasible, and otherwise to minimize such activity by means of agreed deadline extensions and agreed postponement of depositions, document productions, and motion practice if a motion to stay or sever is not feasible or is denied.
III. Injunctive Relief
A. Injunctive Relief. As part of the Consent Judgments, the Parties agree to the entry of the injunctive relief terms as set forth in Exhibit P.
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16 IV. Settlement Payments
A. Settlement Fund. All payments under this Section IV shall be made into the Settlement Fund, except that, where specified, they shall be made into the Settlement Fund Escrow.
The Settlement Fund shall be allocated and used only as specified in Section V.
B. Annual Payments by CVS.
1. CVS shall make ten (10) Annual Payments, each comprised of base payments and incentive payments as provided in this Section IV and Exhibit M-1; provided that the Annual Payment in Payment Year 1 shall consist solely of base payments. As a result, and as set forth in Exhibit M-1, base payments in Payment Years 2 through 10 are less than base payments in Payment Year 1 to ensure they do not exceed thirty-eight percent (38%) of each Settling State’s allocable share of the Maximum Remediation Amount.
2. In no instance shall CVS’s Annual Payment obligation exceed the Maximum Annual Remediation Payments, reduced for Non-Settling States, except as specified in the definition of “Maximum Annual Remediation Payments” for Payment Years 6-10. In no instance shall the sum of CVS’s Annual Payment obligations exceed the Maximum Remediation Payment, reduced for Non-Settling States.
C. Settlement Fund Payment Process
1. To determine each Annual Payment for Payment Year 2 forward, the Settlement Fund Administrator shall use the data as of April 30 of the Payment Year for each Annual Payment, unless another provision of the Agreement specifies a different date.
Prior to the Effective Date, the Parties will include an exhibit to the Agreement setting forth in detail the process for the Settlement Fund Administrator obtaining relevant data and for distributing funds to Settling States and Participating Subdivisions listed on Exhibit G consistent with the terms of this Agreement as quickly as practical.
2. The Settlement Fund Administrator shall determine the Annual Payment and the Statewide Payment Amount for each Settling State, consistent with the provisions in Exhibit L, by:
a. determining, for each Settling State, the amount of base payments and incentive payments to which the State is entitled by applying the criteria in this Section;
b. applying any reductions or offsets required by Section IV and Section XII; and
c. determining the total amount owed by CVS to all Settling States and Participating Subdivisions listed on Exhibit G.
3. As soon as possible, but no later than forty-five (45) days prior to the Payment Date, the Settlement Fund Administrator shall give notice to CVS, the Settling WITH TECHNICAL CORRECTIONS 02.03.2023
17 States, and the Enforcement Committee of the amount of the Annual Payment, and the Statewide Payment Amount for each Settling State, following the determination described in Section IV.C.2, and the following timeline shall apply:
a. Within twenty-one (21) days of the notice provided by the Settlement Fund Administrator, CVS, any Settling State or the Enforcement Committee may dispute, in writing, the calculation of the Annual Payment, or the Statewide Payment Amount for a Settling State. Such disputing party must provide a written notice of dispute to the Settlement Fund Administrator, the Enforcement Committee, any affected Settling State, and CVS identifying the nature of the dispute, the amount of money that is disputed, and the Settling State(s) affected. b. Within twenty-one (21) days of the sending of a written notice of dispute, any affected party may submit a response, in writing, to the Settlement Fund Administrator, the Enforcement Committee, any affected Settling State, and CVS identifying the basis for disagreement with the notice of dispute. c. If no response is filed, the Settlement Fund Administrator shall adjust the amount calculated consistent with the written notice of dispute, and CVS shall pay the adjusted amount as the Annual Payment on the Payment Date. If a written response to the written notice of dispute is timely sent to the Settlement Fund Administrator, the Settlement Fund Administrator shall notify CVS of the preliminary amount to be paid, which shall be the greater of the amount originally calculated by the Settlement Fund Administrator or the amount that would be consistent with the notice of dispute, provided, however, that in no circumstances shall the preliminary amount to be paid be higher than the Maximum Annual Payment. For the avoidance of doubt, a transfer of payments from the Settlement Fund Escrow for other Payment Years does not count toward determining whether the amount to be paid is higher than the Maximum Annual Remediation Payments. d. The Settlement Fund Administrator shall place any disputed amount of the preliminary amount paid by CVS into the Settlement Fund Escrow and shall disburse any undisputed amount to each Settling State and its Participating Subdivisions listed on Exhibit G.
e. At any time before the Payment Date for an Annual Payment, CVS and the Enforcement Committee may agree on the amount of the Annual Payment and the Statewide Payment Amount for each Settling State. If such agreement is reached, CVS and the Enforcement Committee shall inform the Settlement Fund Administrator, and the Settlement Fund Administrator shall treat those amounts as the determination described in Section IV.C.2.
4. If a Settling State informs the Settlement Fund Administrator that it and its Participating Subdivisions listed on Exhibit G have reached consensus on the amount of its Statewide Payment Amount, determined pursuant to Section IV.C.2 or Section IV.C.3, to be distributed to the Settling State, among its separate types of funds (if applicable), and among its Participating Subdivisions listed on Exhibit G, the Settlement Fund WITH TECHNICAL CORRECTIONS 02.03.2023
18 Administrator shall disburse the Statewide Payment Amount pursuant to the consensus distribution amounts provided by the Settling State. For a Settling State that does not so notify the Settlement Fund Administrator, the Settlement Fund Administrator shall allocate the Settling State’s Statewide Payment Amount, pursuant to Section V, among the separate types of funds for the Settling State (if applicable), and among its Participating Subdivisions listed on Exhibit G using the following procedures:
a. As soon as possible for each payment and following the determination described in Section IV.C.2 or Section IV.C.3, the Settlement Fund Administrator shall give notice to the relevant Settling States and their Participating Subdivisions listed on Exhibit G of the amount to be received by each Settling State, the amount to be received by the separate types of funds for each Settling State (if applicable), and the amount to be received by each Participating Subdivision listed on Exhibit G for each Settling State.
b. Within twenty-one (21) days of the notice provided by the Settlement Fund Administrator, any Settling State or Participating Subdivision listed on Exhibit G may dispute, in writing, the calculation of the amount to be received by the relevant Settling State and/or its Participating Subdivision listed on Exhibit G. A dispute will be deemed invalid and disregarded if it challenges the allocations adopted by a State-Subdivision Agreement approved pursuant to the provisions of Exhibit O or by statute. Such disputing party must provide a written notice of dispute to the Settlement Fund Administrator, any affected Settling State, and any affected Participating Subdivision identifying the nature of the dispute, the amount of money that is disputed, and the Settling State(s) affected. c. Within twenty-one (21) days of the sending of a written notice of dispute, any affected Settling State or any affected Participating Subdivision may submit a response, in writing, to the Settlement Fund Administrator, any affected Settling State and any affected Participating Subdivision identifying the basis for disagreement with the notice of dispute.
d. If no response is filed, the Settlement Fund Administrator shall adjust the amount calculated consistent with the written notice of dispute. e. The Settlement Fund Administrator shall place any disputed amount into the Settlement Fund Escrow and shall disburse any undisputed amount to the Settling State and its Participating Subdivisions eligible for payment.
5. Disputes described in this subsection (other than those for which no response is filed under Section IV.C.3.c or Section IV.C.4.d) shall be resolved in accordance with the terms of Section VI.
6. The Settlement Fund Administrator may combine the disbursements of Annual Payments with disbursement of funds under other comparable opioid settlements.
In determining when disbursements for each Annual Payment will be made, the Settlement Fund Administrator may take into account the timeline for the availability of disbursements WITH TECHNICAL CORRECTIONS 02.03.2023
19 under other comparable opioid settlements. No such disbursement determinations by the Settlement Fund Administrator shall impact in any respect the amount, composition, or determination of an Annual Payment under this Agreement or CVS’s obligations under this Agreement.
7. For the avoidance of doubt, Subdivisions not listed on Exhibit G shall not receive and are not eligible to receive an allocation from the Subdivision Fund and no provision of this Agreement shall be interpreted to create such an entitlement.
D. Payment Date and Procedure for Annual Payment in Payment Year 1. The procedure described in Section IV.C.2 and Section IV.C.3 for determining the amount of the Annual Payment shall not apply to Payment Year 1. The procedure in lieu of Section IV.C.2 and Section IV.C.3 for determining the amount of the Annual Payment for Payment Year 1 is as set forth here. The Payment Date for Payment Year 1 is June 30, 2023 or the Effective Date, whichever is later. On or before such date, and provided that the conditions set forth in Section II.B, Section II.C, Section VIII.B, and Section VIII.C have been satisfied, CVS shall deposit into the Settlement Fund the Maximum Annual Remediation Payment for Payment Year 1 as specified in Exhibit M-1 (which, again, shall consist only of base payments). The excess amount paid in Payment Year 1—including without limitation any amounts allocable to Non-Settling States— shall be deducted from the Annual Payment for Payment Year 2, along with any other deductions or reductions to the Annual Payment for Payment Year 2.
E. Payment Date for Payment Years 2 through 10. The Payment Date for Payment Years 2 through 10 is June 30 of each Payment Year or thirty (30) calendar days from when the Settlement Fund Administrator gives notice to CVS of the amount of the Annual Payment for a Payment Year, whichever is later. The Annual Payments for those Payment Years shall be made pursuant to the process set forth in Section IV.C.
F. Offsets to Annual Payments to the Settlement Fund for Non-Settling States. An offset equal to the Maximum Remediation Payment of $4,279,160,837 times the Overall Allocation Percentage assigned to each Non-Settling State in Exhibit F-2 shall be deducted from the total amount to be paid by CVS to the Settlement Fund. Non-Settling States shall not be eligible for any payments or have any rights in connection with this Agreement. Accordingly, the Maximum Annual Remediation Payments specified in Exhibit M-1 are reduced by the aggregate Overall Allocation Percentage of Non-Settling States as set forth in Exhibit F-2.
G. Base Payments.
1. CVS shall make base payments into the Settlement Fund in an amount equal to thirty-eight percent (38%) of the Maximum Remediation Payment of $4,279,160,837 minus any offsets for Non-Settling States specified in Section IV.F. The maximum total for base payments is $1,626,081,118. The base payments shall be due in annual installments consistent with Exhibit M-1 over the ten (10) Payment Years, subject to potential offsets for Non-Settling States as provided in Section IV.F.
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20 2. Each Settling State’s total base payments for all Payment Years shall not exceed thirty-eight percent (38%) of each Settling State’s Overall Allocation Percentage times the Maximum Remediation Payment.
3. The base payment for any Settling State in each Payment Year shall be the base payment for that Payment Year specified in Exhibit M-1 times the Settling State’s Overall Allocation Percentage specified in Exhibit F-2.
H. Incentive Payments.
1. CVS shall make potential incentive payments into the Settlement Fund, totaling up to a maximum of sixty-two percent (62%) of the Maximum Remediation Payment of $4,279,160,837, minus any offsets for Non-Settling States specified in Section IV.F, with the actual incentive payment amount depending on whether and the extent to which the criteria set forth below are met in each Settling State. The potential maximum total for incentive payments is and cannot exceed $2,653,079,719.
2. A Settling State qualifies to receive incentive payments in addition to base payments if it meets the incentive eligibility requirements specified below. The maximum total Incentive Payment for any Settling State shall be no more than the maximum total for incentive payments listed in Section IV.H.1 times the Settling State’s Overall Allocation Percentage specified in Exhibit F-2. Incentive payments are state-specific, with the actual amount depending on whether and the extent to which the criteria set forth below are met in such Settling State.
3. The incentive payments shall be available from four (4) categories, referred to as Incentive Payments A, B, C, and D. Incentive Payments A, B, and C will be due in annual installments over the nine (9) Payment Years beginning with Payment Year 2, and Incentive Payment D will be due in installments over five (5) years beginning with Payment Year 6, as shown on Exhibit M-1. The total amount of incentive payments in an Annual Payment shall be the sum of the incentive payments for which individual Settling States are eligible for that Payment Year under the criteria set forth below. The incentive payments shall be determined with respect to a specific Settling State based on its eligibility for that Payment Year under the criteria set forth below. For the avoidance of doubt, eligibility for Incentive Payments A, B, C, and D shall be determined on a Settling Stateby-Settling State basis and for each Payment Year as set forth below. Except to the limited extent provided below for Incentives A (see Section IV.H.6.c) and D (see Section IV.H.9.j), a Settling State may not earn and shall not be paid in any later Payment Year an annual incentive payment for a prior Payment Year, or any portion thereof, that it failed to qualify for in that prior Payment Year.
4. A Settling State may either qualify for Incentive Payment A, or it can alternatively qualify for Incentive Payments B, C, and/or D. A Settling State will be eligible for its full allocable share of the maximum amount available for incentive payments by either (a) achieving Incentive Payment A within two (2) years of the Effective Date or (b) by fully earning Incentive Payment B in each Payment Year it is available and WITH TECHNICAL CORRECTIONS 02.03.2023
21 earning Incentive Payments C and D in a manner that produces that maximum possible combined amount from those two incentives.
5. The following time periods apply to Incentive Payments B and C:
a. Period 1: Zero to two hundred ten (210) days after the Effective Date.
b. Period 2: Two hundred eleven (211) days to one year after the Effective Date.
c. Period 3: One year and one day after the Effective Date to April 30, 2027.
6. Incentive Payment A.
a. Incentive Payment A is mutually exclusive with Incentive Payments B, C, and D; if a Settling State receives Incentive Payment A in an Annual Payment, such Settling State is not eligible for Incentive Payments B, C, or D in that Annual Payment.
b. Incentive Payment A shall be up to a maximum of sixty-two percent (62%) of the Maximum Remediation Payment of $4,279,160,837, minus any offsets for Non-Settling States specified in Section IV.F, with the actual amount depending on whether and the extent to which the criteria set forth below are met in each Settling State. The potential maximum total for Incentive Payment A is $2,653,079,719.
c. The Incentive Payment A for any Settling State in each Payment Year shall be the Incentive Payment A for that Payment Year specified in Exhibit M-1 times the Settling State’s Overall Allocation Percentage specified in Exhibit F-2, provided such Settling State achieves Incentive Payment A by two (2) years after the Effective Date. If a Settling State achieves Incentive Payment A after April 30, 2024 but before two (2) years after the Effective Date, it shall receive a catch-up payment as part of the next Annual Payment for the difference between what it would have earned had it qualified for Incentive Payment A for Payment Year 2 and what it was actually paid for Payment Year 2. The Settlement Fund Administrator shall decrease the catch-up payments payable pursuant to this Section IV.H.6.c to the extent they cannot be paid without exceeding an applicable payment limit shown in Exhibit M-1 for the next Payment Year. d. A Settling State is eligible for Incentive Payment A if: (i) there is a Bar in that State in full force and effect; (ii) there is a Settlement Class Resolution in that State in full force and effect; (iii) there is a ruling from the State’s highest court barring all Subdivisions from bringing or maintaining Released Claims; (iv) the Released Claims of all of the following entities are released through the execution of Subdivision Participation Agreements: (1) all Litigating Subdivisions, WITH TECHNICAL CORRECTIONS 02.03.2023
22 (2) all Non-Litigating Primary Subdivisions, (3) all non-litigating School Districts with a K-12 student enrollment of at least 25,000 or 0.10% of a State’s population, whichever is greater, (4) all non-litigating health districts and hospital districts that have at least one hundred twenty-five (125) hospital beds in one or more hospitals rendering services in that district, and (5) all Primary Fire Districts; or (v) a combination of the actions in clauses (i)-(iv) has achieved the same level of resolution of Claims by Subdivisions (e.g., a Bar against future litigation combined with full joinder by Litigating Subdivisions). For the avoidance of doubt, subsection (iv) cannot be satisfied unless all Litigating Subdivisions are Participating Subdivisions or there is a Case-Specific Resolution against any such Subdivisions that are not Participating Subdivisions.
e. A Settling State that does not achieve Incentive Payment A as of two (2) years after the Effective Date shall not be eligible for, and shall not receive, Incentive Payment A for any Payment Year.
f. CVS shall acknowledge on or before the Initial Subdivision Participation Date the sufficiency of any existing Bars in Settling States, provided that such States shall have provided no less than 30 days’ notice to CVS of such Bars. Any other Settling State that believes it qualifies for Incentive Payment A by two (2) years after the Effective Date shall provide prompt notice to CVS, the Enforcement Committee, and the Settlement Fund Administrator, including data sources or other information establishing such Settling State’s entitlement to Incentive Payment A. CVS and the Enforcement Committee shall meet and confer in order to agree on data sources for purposes of this Section prior to the Preliminary Agreement Date.
g. If CVS made a payment under Incentive Payment A solely on the basis of a Bar or Settlement Class Resolution in a Settling State and that Bar or Settlement Class Resolution is subsequently subject to a Revocation Event, that Settling State shall not be eligible for Incentive Payment A thereafter, unless the State requalifies for Incentive Payment A through any method pursuant to Section IV.H.6.d, in which case the Settling State shall be eligible for Incentive Payment A less any litigation fees and costs incurred by CVS in the interim, except that, if the re-imposition occurs after the completion of opening statements in a trial involving a Released Claim, the Settling State shall not be eligible for Incentive Payment A (unless this exception is waived by CVS).
7. Incentive Payment B.
a. Incentive Payment B shall be available to Settling States that do not qualify for Incentive Payment A.
b. Incentive Payment B shall be up to a potential maximum of twentyeight percent (28%) of the Maximum Remediation Payment of $4,279,160,837 minus any offsets for Non-Settling States specified in Section IV.F, with the actual amount depending on whether and the extent to which the criteria set forth below WITH TECHNICAL CORRECTIONS 02.03.2023
23 are met in each Settling State. The potential maximum total for Incentive Payment B is $1,198,165,035.
c. The potential maximum Incentive Payment B for any Settling State in each Payment Year shall be the Incentive Payment B for that Payment Year specified in Exhibit M-1 times the Settling State’s Overall Allocation Percentage specified in Exhibit F-2, provided such Settling State becomes eligible for Incentive Payment B by April 30 of the Payment Year or April 30, 2027, whichever is earlier.
The Incentive Payment B for any Settling State that qualifies for Incentive Payment B is subject to reduction in accordance with Section IV.H.7.f, Section IV.H.7.g, and Section IV.H.7.h.
d. For Payment Years 2 through 5, the calculations specified by this Section IV.H.7 shall be based on a Settling State’s Participation Percentage of Litigating Subdivision Population6 as of April 30 of that Payment Year. For Payment Years 6 through 10, the calculations specified by this Section IV.H.7 shall be based on a Settling State’s Participation Percentage of Litigating Subdivision Population as of April 30, 2027.
e. A Settling State qualifies for an Incentive Payment B if Litigating Subdivisions collectively representing at least eighty-five percent (85%) of the Settling State’s Litigating Subdivision population are either Participating Subdivisions or have their Claims resolved through Case-Specific Resolutions. f. Within Period 1: If Litigating Subdivisions collectively representing at least eighty-five percent (85%) of a Settling State’s Litigating Subdivision population are Participating Subdivisions, or have their Claims resolved through Case-Specific Resolutions, during Period 1, then a sliding scale will determine the share of the Settling State’s maximum Incentive Payment B for a Payment Year that it has earned. Under that sliding scale, if Litigating Subdivisions collectively representing eighty-five percent (85%) of a Settling State’s Litigating Subdivision population become Participating Subdivisions, or achieve Case-Specific Resolution status, by the end of Period 1, a Settling State will receive twenty percent (20%) of its maximum Incentive Payment B for each Payment Year. If more Litigating 6 The “Participation Percentage of Litigating Subdivision Population” shall be determined by the aggregate population of a Settling State’s Litigating Subdivisions (including without limitation School Districts and Special Districts) that are Participating Subdivisions, or have their Claims resolved through Case-Specific Resolutions, divided by the aggregate population of that Settling State’s Litigating Subdivisions (including without limitation School Districts and Special Districts). In calculating the Settling State’s population that resides in Litigating Subdivisions, the population of the Settling State’s Litigating Subdivisions shall be the sum of the population of all Litigating Subdivisions in the Settling State, notwithstanding that persons may be included within the population of more than one Litigating Subdivision. An individual Litigating Subdivision shall not be included more than once in the numerator, and shall not be included more than once in the denominator, of the calculation regardless if it (or any of its officials) is named as multiple plaintiffs in the same lawsuit; provided, however, that for the avoidance of doubt, no Litigating Subdivision will be excluded from the numerator or denominator under this sentence unless a Litigating Subdivision otherwise counted in the denominator has the authority to release the Claims (consistent with Section XI) of the Litigating Subdivision to be excluded.
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24 Subdivisions become Participating Subdivisions, or achieve Case-Specific Resolution status, the Settling State shall receive an increased percentage of the maximum Incentive Payment B for each Payment Year as shown in the table below.
Participation Percentage of Litigating
Subdivision Population Incentive Payment B Percentage
Participation of less than 85% Payment of 0% of Incentive B Participation of 85% but less than 86% Payment of 20% of Incentive B Participation of 86% but less than 87% Payment of 30% of Incentive B Participation of 87% but less than 88% Payment of 33% of Incentive B Participation of 88% but less than 89% Payment of 36% of Incentive B Participation of 89% but less than 90% Payment of 40% of Incentive B Participation of 90% but less than 91% Payment of 43% of Incentive B Participation of 91% but less than 92% Payment of 46% of Incentive B Participation of 92% but less than 93% Payment of 50% of Incentive B Participation of 93% but less than 94% Payment of 55% of Incentive B Participation of 94% but less than 95% Payment of 58% of Incentive B Participation of 95% but less than 96% Payment of 60% of Incentive B Participation of 96% but less than 97% Payment of 70% of Incentive B Participation of 97% but less than 98% Payment of 75% of Incentive B Participation of 98% but less than 99% Payment of 85% of Incentive B Participation of 99% but less than 100% Payment of 95% of Incentive B Participation of 100% Payment of 100% of Incentive B
g. Within Period 2: If a Settling State did not qualify for Incentive Payment B in Period 1, but Litigating Subdivisions collectively representing at least eighty-five percent (85%) of the Settling State’s Litigating Subdivision population become Participating Subdivisions, or achieve Case-Specific Resolution status, by the end of Period 2, then the Settling State qualifies in each Payment Year for seventy-five percent (75%) of the Incentive Payment B it would have qualified for in Period 1. If a Settling State qualifies for Incentive Payment B in Period 1 and increases its Participation Percentage of Litigating Subdivision Population in Period 2, the additional Incentive Payment B for each Payment Year shall be eighty-seven and one-half percent (87.5%) of the difference between (i) the Incentive Payment B calculated pursuant to Section IV.H.7.f in Period 2 and (ii) the Incentive Payment B calculated pursuant to Section IV.H.7.f at the end of Period 1.
h. Within Period 3: If a Settling State did not qualify for an Incentive Payment B in Periods 1 or 2, but Litigating Subdivisions collectively representing at least eighty-five percent (85%) of the Settling State’s Litigating Subdivision population become Participating Subdivisions, or achieve Case-Specific Resolution status, by the end of Period 3, then the Settling State qualifies for fifty percent (50%) of the Incentive Payment B it would have qualified for in Period 1. If a WITH TECHNICAL CORRECTIONS 02.03.2023
25 Settling State qualifies for Incentive Payment B in Period 2 and increases its Participation Percentage of Litigating Subdivision Population in Period 3, the additional Incentive Payment B in each Payment Year shall be seventy-five percent (75%) of the difference between (i) the Incentive Payment B calculated pursuant to Section IV.H.7.f in Period 3 and (ii) the Incentive Payment B calculated pursuant to Section IV.H.7.f at the end of Period 2.
i. For the avoidance of doubt, an increase in a Settling State’s Participation Percentage of Litigating Subdivision Population in Periods 2 and/or 3 from an earlier Period entitles the Settling State to receive the Incentive Payment B Percentage it had earned as of the end of the earlier Period plus the additional Incentive Payment B Percentage specified by the calculations in Section IV.H.7.g and Section IV.H.7.h.
j. If a Settling State has not qualified for Incentive Payment B by April 30, 2027, it shall no longer be eligible to qualify for and shall not receive any Incentive Payment B for any Payment Year.
k. If there are no Litigating Subdivisions in a Settling State, and that Settling State is otherwise eligible for Incentive Payment B, that Settling State will receive its maximum Incentive Payment B for that Annual Payment provided by Section IV.H.7.c.
8. Incentive Payment C.
a. Incentive Payment C shall be available to Settling States that do not qualify for Incentive Payment A.
b. Incentive Payment C shall be equal to up to a potential maximum of twenty-eight percent (28%) of the Maximum Remediation Payment of $4,279,160,837 minus any offsets for Non-Settling States specified in Section IV.F, with the actual amount depending on whether and the extent to which the criteria set forth below are met in each Settling State. The potential maximum total for Incentive Payment C is $1,198,165,035.
c. The potential maximum Incentive Payment C for any Settling State in each Payment Year shall be the Incentive Payment C for that Payment Year specified in Exhibit M-1 times the Settling State’s Overall Allocation Percentage specified in Exhibit F-2, provided such Settling State becomes eligible for Incentive Payment B by April 30 of the Payment Year or April 30, 2027, whichever is earlier.
The maximum Incentive Payment C for any Settling State that qualifies for Incentive Payment C is subject to reduction in accordance with Section IV.H.8.f, Section IV.H.8.g, and Section IV.H.8.h.
d. For Payment Years 2 through 5, the calculations specified by this Section IV.H.8 shall be based on the participation percentage of a Settling State’s Non-Litigating Threshold population and its Litigating Subdivision population WITH TECHNICAL CORRECTIONS 02.03.2023
26 (“Participation Percentage of Incentive C Eligible Subdivision Population”)7 as of April 30 of that Payment Year. For Payment Years 6 through 10, the calculations specified by this Section IV.H.8 shall be based on a Settling State’s Participation Percentage of Incentive C Eligible Subdivision Population as of April 30, 2027. e. Incentive Payment C shall be available depending on the percentage of the aggregate population of a Settling State’s Non-Litigating Threshold Subdivisions and Litigating Subdivisions (including without limitation School Districts and Special Districts) that are Participating Subdivisions or have their Claims resolved through Case-Specific Resolutions (the “Incentive C Eligible Subdivisions”). A Settling State qualifies for an Incentive Payment C if Incentive C Eligible Subdivisions collectively representing at least eighty-five percent (85%) of the Settling State’s Incentive C Eligible Subdivision population are either Participating Subdivisions or have their Claims resolved through Case-Specific Resolutions.
f. Within Period 1: If Incentive C Eligible Subdivisions collectively representing at least eighty-five percent (85%) of a Settling State’s Incentive C Eligible Subdivision population are Participating Subdivisions, or have their Claims resolved through Case-Specific Resolutions, during Period 1, then a sliding scale will determine the share of the Settling State’s maximum Incentive Payment C for a Payment Year that it has earned. Under that sliding scale, if Incentive C Eligible Subdivisions collectively representing eighty-five percent (85%) of a Settling State’s Incentive C Eligible population become Participating Subdivisions or achieve Case-Specific Resolution status by the end of Period 1, a Settling State will receive twenty percent (20%) of its maximum Incentive Payment C for each Payment Year. If more Incentive C Eligible Subdivisions become Participating Subdivisions, or achieve Case-Specific Resolution status, the Settling State shall receive an increased percentage of the maximum Incentive Payment C for each Payment Year as shown in the table below.
7 The “Participation Percentage of Incentive C Eligible Subdivision Population” shall be determined by the aggregate population of a Settling State’s Non-Litigating Threshold Subdivisions and Litigating Subdivisions (including without limitation School Districts and Special Districts) that are Participating Subdivisions, or have their Claims resolved through Case-Specific Resolutions, divided by the aggregate population of that Settling State’s Non-Litigating Threshold Subdivisions and Litigating Subdivisions (including without limitation School Districts and Special Districts). In calculating the Settling State’s population that resides in Non-Litigating Threshold Subdivisions and Litigating Subdivisions, the population of the Settling State’s Non-Litigating Threshold Subdivisions and Litigating Subdivisions shall be the sum of the population of all Non-Litigating Threshold Subdivisions and Litigating Subdivisions in the Settling State, notwithstanding that persons may be included within the population of more than one Non-Litigating Threshold Subdivisions and Litigating Subdivision. An individual Non-Litigating Threshold Subdivisions or Litigating Subdivision shall not be included more than once in the numerator, and shall not be included more than once in the denominator, of the calculation regardless if it (or any of its officials) is named as multiple plaintiffs in the same lawsuit; provided, however, that for the avoidance of doubt, no Non-Litigating Threshold Subdivision or Litigating Subdivision will be excluded from the numerator or denominator under this sentence unless a Non-Litigating Threshold Subdivision or Litigating Subdivision otherwise counted in the denominator has the authority to release the Claims (consistent with Section XI) of the Non-Litigating Threshold Subdivision or Litigating Subdivision to be excluded.
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27 Participation Percentage of Incentive
C Eligible Subdivision Population Incentive Payment C Percentage Participation of less than 85% Payment of 0% of Incentive C Participation of 85% but less than 86% Payment of 20% of Incentive C Participation of 86% but less than 87% Payment of 30% of Incentive C Participation of 87% but less than 88% Payment of 33% of Incentive C Participation of 88% but less than 89% Payment of 36% of Incentive C Participation of 89% but less than 90% Payment of 40% of Incentive C Participation of 90% but less than 91% Payment of 43% of Incentive C Participation of 91% but less than 92% Payment of 46% of Incentive C Participation of 92% but less than 93% Payment of 50% of Incentive C Participation of 93% but less than 94% Payment of 55% of Incentive C Participation of 94% but less than 95% Payment of 58% of Incentive C Participation of 95% but less than 96% Payment of 60% of Incentive C Participation of 96% but less than 97% Payment of 70% of Incentive C Participation of 97% but less than 98% Payment of 75% of Incentive C Participation of 98% but less than 99% Payment of 85% of Incentive C Participation of 99% but less than 100% Payment of 95% of Incentive C Participation of 100% Payment of 100% of Incentive C
g. Within Period 2: If a Settling State did not qualify for Incentive Payment C in Period 1, but Incentive C Eligible Subdivisions collectively representing at least eighty-five percent (85%) of the Settling State’s Incentive C Eligible Subdivision population become Participating Subdivisions, or achieve Case-Specific Resolution status, by the end of Period 2, then the Settling State qualifies in each Payment Year for seventy-five percent (75%) of the Incentive Payment C it would have qualified for in Period 1. If a Settling State qualifies for Incentive Payment C in Period 1 and increases its Participation Percentage of Incentive C Eligible Subdivision Population in Period 2, the additional Incentive Payment C for each Payment Year shall be eighty-seven and one-half percent (87.5%) of the difference between (i) the Incentive Payment C calculated pursuant to Section IV.H.8.f in Period 2 and (ii) the Incentive Payment C calculated pursuant to Section IV.H.8.f at the end of Period 1.
h. Within Period 3: If a Settling State did not qualify for an Incentive Payment C in Periods 1 or 2, but Incentive C Eligible Subdivisions collectively representing at least eighty-five percent (85%) of the Settling State’s Incentive C Eligible Subdivision population become Participating Subdivisions, or achieve Case-Specific Resolution status, by the end of Period 3, then the Settling State qualifies for fifty percent (50%) of the Incentive Payment C it would have qualified for in Period 1. If a Settling State qualifies for Incentive Payment C in Period 2 and increases its Participation Percentage of Incentive C Eligible Subdivision Population in Period 3, the additional Incentive Payment B in each Payment Year shall be seventy-five percent (75%) of the difference between (i) the Incentive WITH TECHNICAL CORRECTIONS 02.03.2023
28 Payment B calculated pursuant to Section IV.H.8.f in Period 3 and (ii) the Incentive Payment B calculated pursuant to Section IV.H.8.f at the end of Period 2. i. For the avoidance of doubt, an increase in a Settling State’s Participation Percentage of Incentive C Eligible Subdivision Population in Periods 2 and/or 3 from an earlier Period entitles the Settling State to receive the Incentive Payment C Percentage it had earned as of the end of the earlier Period plus the additional Incentive Payment C Percentage specified by the calculations in Section IV.H.8.g and Section IV.H.8.h.
j. If a Settling State has not qualified for Incentive Payment C by April 30, 2027, it shall no longer be eligible to qualify for and shall not receive any Incentive Payment C for any Payment Year.
k. If there are no Incentive C Eligible Subdivisions in a Settling State, and that Settling State is otherwise eligible for Incentive Payment C, that Settling State will receive its maximum Incentive Payment C for that Annual Payment provided by Section IV.H.8.c.
9. Incentive Payment D.
a. Incentive Payment D shall be available to Settling States that do not qualify for Incentive Payment A.
b. Incentive Payment D shall be equal to up to a potential maximum of fifteen percent (15%) of the Maximum Remediation Payment of $4,279,160,837 minus any offsets for Non-Settling States specified in Section IV.F, with the actual amount depending on whether and the extent to which the criteria set forth below are met in each Settling State. The potential maximum total for Incentive Payment D is $641,874,126.8
c. Incentive Payment D shall be available to be earned starting at Payment Year 6 and the amount of Incentive Payment D in Payment Years 6-10 will depend on (i) the Settling State’s eligibility as set out in Section IV.H.9.d and (ii) the Participation Percentage of the Incentive C Eligible Subdivision Population achieved by the Settling State as of April 30, 2027.
d. A Settling State is eligible for Incentive Payment D if no Later Litigating Subdivision (for purposes of Incentive Payment D, Later Litigating Subdivisions are limited to (i) a Primary Subdivision; (ii) a school district with a K-12 student enrollment of at least 25,000 or 0.10% of the State’s population, whichever is greater; (iii) a health district or hospital district that has at least one 8 The Incentive Payment C table specified in Section IV.H.8.f and Incentive Payment D table specified in Section IV.H.9.e operate so that the combined amount of Incentive Payment C and Incentive Payment D cannot exceed thirtyfour percent (34%) of the Maximum Remediation Payment over the term of the Agreement. CVS will have no obligation to pay more than $1,454,914,684 for the combined amounts of Incentive Payment C and Incentive Payment D minus any offsets for Non-Settling States specified in Section IV.F and reductions for unachieved incentives.
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29 hundred twenty-five (125) hospital beds in one or more hospitals rendering services in that district; and (iv) Primary Fire Districts) in that State has a lawsuit against a Released Entity that survived in whole or in part a Threshold Motion and is pending as of April 30 in Payment Years 6 to 10 (“Incentive Payment D Look-Back Dates”). e. The Incentive Payment D for any Settling State in Payment Years 6-10 shall be between six percent (6%) and fifteen percent (15%) of the Maximum Remediation Payment times the Settling State’s Overall Allocation Percentage specified in Exhibit F-2. The applicable percentage shall be determined based on the Participation Percentage of the Incentive C Eligible Subdivision Population achieved by the Settling State as of April 30, 2027 as shown in the table below:
f. Incentive Payment D shall be available in equal installments in Payment Years 6-10, unless an adjustment to payment is required by Section IV.H.9.i or Section IV.H.9.j after the Annual Payment is made for Payment Year 6, in which case the adjustment shall be made in a way that equalizes, to the extent possible, its effect over the remaining Payment Years.9 g. Prior to determining the Annual Payment for each of Payment Years 6 through 10, the Settlement Fund Administrator shall determine a Settling State’s eligibility for Incentive Payment D as of the Incentive Payment D Look-Back Date 9 The top of the range for Incentive Payment D specified in Exhibit M-2 for Payment Years 6-10 represents five years of equal payments of Incentive Payment D at fifteen percent (15%) of the Maximum Remediation Payment for all Eligible States. The bottom of the range for Incentive Payment D specified in Exhibit M-2 for Payment Years 6-10 represents five years of equal payments of Incentive Payment D at six percent (6%) of the Maximum Remediation Payment for all Eligible States. Incentive Payment D cannot exceed the top of the range for Incentive Payment D specified in Exhibit M-2 for each of Payment Years 6-10. Any Incentive Payment D in excess of the bottom of the range for Incentive Payment D must correspond to reductions to Incentive Payment C in a prior or the same Payment Year, as provided by the Incentive Payment C table specified in Section IV.H.8.f.
Participation Percentage of Incentive C
Eligible Subdivision Population as of
April 30, 2027
Settling State’s Applicable
Incentive Payment D
Percentage
Participation of less than 96% 15% of Maximum
Remediation Payment
Participation of 96% but less than 97% 14.4% of Maximum Remediation Payment
Participation of 97% but less than 98% 13% of Maximum
Remediation Payment
Participation of 98% but less than 99% 10.2% of Maximum Remediation Payment
Participation of 99% but less than 100% 7.4% of Maximum Remediation Payment
Participation of 100% 6% of Maximum
Remediation Payment
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30 in each such Payment Year. Prior to each Incentive Payment D Look-Back Date, CVS may provide the Settlement Fund Administrator and the Enforcement Committee with notice identifying any Settling State(s) it believes do not qualify for Incentive Payment D and information supporting its belief. h. If, at any time during the term of this Agreement any Subdivision becomes a Later Litigating Subdivision (as that term is limited by Section IV.H.9.c), then CVS shall, within thirty (30) calendar days of CVS or any Released Entity being served, provide notice to the Settling State in which such Released Claims are being pursued and shall give the relevant Settling State a reasonable opportunity to extinguish the Released Claims without any payment or any other obligations being imposed upon any Released Entities (apart from the Global Settlement Amount payable by CVS under the Agreement or the Injunctive Relief Terms incurred by it). The relevant Settling State and CVS shall confer and use reasonable efforts to promptly resolve the lawsuit so that it is dismissed with prejudice. Nothing in this subsection creates an obligation for a Settling State to make a monetary payment or incur any other obligation to an entity filing a lawsuit. i. If a Later Litigation Subdivision’s lawsuit results in a money judgment being entered against a Released Entity or reasonable settlement being reached with a Released Entity, the amount is to be set off from the total Incentive Payment D for which the Settling State may become eligible. The total Incentive Payment D for which the Settling State may become eligible shall be reduced by the amount of the judgment or settlement.
j. Notwithstanding Section IV.H.9.d, a Settling State can become reeligible for Incentive Payment D if the lawsuit that survived a Threshold Motion is dismissed pursuant to a later motion on grounds included in the Threshold Motion, in which case the Settling State shall be eligible for any missed payments of Incentive Payment D in the following Payment Year, less any litigation fees and costs incurred by CVS in the interim, except that if the dismissal motion occurs after the completion of opening statements in such action, the Settling State shall not be eligible for Incentive Payment D. The Settlement Fund Administrator shall decrease the missed payments payable pursuant to this Section IV.H.9.j to the extent it cannot be paid without exceeding the top end of an applicable payment range shown in Exhibit M-2 for the remaining Payment Years.
I. In no event shall any Settling State receive base payments and incentive payments totaling more than one hundred percent (100%) of its respective Overall Allocation Percentage specified in Exhibit F-2 times the Maximum Remediation Payment.
J. Credit for Dispensing Services. CVS and a Settling State may enter into an agreement for CVS to earn credits against Annual Payments for dispensing free-of-charge opioid alternatives, for free-of-charge product provided in connection with other opioid-related resolutions, and/or for other initiatives and services.
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31 V. Allocation and Use of Settlement Payments
A. Components of Settlement Fund. The Settlement Fund shall be comprised of a Remediation Accounts Fund, a State Fund, and a Subdivision Fund for each Settling State. The payment made under Section IV into the Settlement Fund shall be initially allocated among those three (3) sub-funds and distributed and used as provided below or as provided for by a StateSubdivision Agreement (or other State-specific allocation of funds).
B. Use of Settlement Payments.
1. It is the intent of the Parties that the payments disbursed from the Settlement Fund to Settling States and Participating Subdivisions be for Opioid Remediation to address Alleged Harms, subject to exceptions that must be documented in accordance with Section V.B.2. In no event may less than 95.5% of CVS’s maximum payment amounts pursuant to Section IV as set forth on Exhibit M-1 over the entirety of all Payment Years (but not in any single Payment Year) be spent on Opioid Remediation; provided, however, that the remaining 4.5% only may be spent outside of Opioid Remediation to the extent necessary to satisfy: (a) back-stop attorney fee agreements entered into by Settling States with respect to at least one opioid settlement on or before November 30, 2022, even if such an agreement did not as of that date apply to CVS’s Annual Payments; or (b) contingency fee agreements entered into by Settling States covering CVS’s Annual Payments. Any amounts not spent to satisfy such agreements must be spent on Opioid Remediation.
2. While disfavored by the Parties, a Settling State or a Participating Subdivision may, subject to the limitation in the second sentence of Section V.B.1, use monies from the Settlement Fund (that have not been restricted by this Agreement solely to future Opioid Remediation) for purposes that do not qualify as Opioid Remediation, provided that if, at any time, a Settling State or a Participating Subdivision listed on Exhibit G uses any monies from the Settlement Fund for a purpose that does not qualify as Opioid Remediation, such Settling State or Participating Subdivision listed on Exhibit G shall identify such amounts and report to the Settlement Fund Administrator and CVS how such funds were used, including if used to pay attorneys’ fees, investigation costs, litigation costs, or costs related to the operation and enforcement of this Agreement, respectively.
Such expenditures shall be reported to the Settlement Fund Administrator and CVS by January 31 of the year following the calendar year in which they are made. It is the intent of the Parties that the reporting under this Section V.B.2 shall be available to the public.
For the avoidance of doubt, (a) any amounts not identified under this Section V.B.2 as used to pay attorneys’ fees, investigation costs, or litigation costs shall be included in the Total Remediation Amount for purposes of Section V.F and (b) Participating Subdivisions not listed on Exhibit G may only use monies from the Settlement Fund for purposes that qualify as Opioid Remediation.
C. Allocation of Settlement Fund. The allocation of the Settlement Fund allows for different approaches to be taken in different Settling States, such as through a State-Subdivision Agreement. Given the uniqueness of Settling States and their Participating Subdivisions, Settling States and their Participating Subdivisions are encouraged to enter into State-Subdivision WITH TECHNICAL CORRECTIONS 02.03.2023
32 Agreements in order to direct the allocation of their portion of the Settlement Fund. This Agreement has no effect on the ability of Settling States and their Participating Subdivisions to internally agree on the allocation of their portion of the Settlement Fund. As set out below, the Settlement Fund Administrator will make an initial allocation to three (3) state-level sub-funds.
The Settlement Fund Administrator will then, for each Settling State and its Participating Subdivisions, apply the terms of this Agreement and any relevant State-Subdivision Agreement, Statutory Trust, Allocation Statute, or voluntary redistribution of funds as set out below before disbursing the funds.
1. Base Payments. The Settlement Fund Administrator will allocate base payments under Section IV.G among the Settling States pursuant to Section VI.G. Base payments for each Settling State will then be allocated fifteen percent (15%) to its State Fund, seventy percent (70%) to its Remediation Accounts Fund, and fifteen percent (15%) to its Subdivision Fund. Amounts may be reallocated and will be distributed as provided in Section V.D.
2. Incentive Payments. The Settlement Fund Administrator will treat incentive payments under Section IV.H on a Settling State-specific basis in proportion to each Settling State’s respective Overall Allocation Percentage. Incentive payments for which a Settling State is eligible under Section IV.H will be allocated fifteen percent (15%) to its State Fund, seventy percent (70%) to its Remediation Accounts Fund, and fifteen percent (15%) to its Subdivision Fund. Amounts may be reallocated and will be distributed as provided in Section V.D.
3. Settlement Fund Administrator. Prior to the Initial Subdivision Participation Date, CVS and the Enforcement Committee will agree to a detailed mechanism consistent with the foregoing for the Settlement Fund Administrator to follow in allocating, apportioning, and distributing payments, which shall then be appended hereto as Exhibit L.
4. Settlement Fund Administrator Costs. Any reasonable costs and fees of the Settlement Fund Administrator accruing under this Agreement as described in Exhibit L shall be paid from the interest accrued in the Settlement Fund; provided, however, that if such accrued interest is insufficient to pay the entirety of any such costs and fees, CVS shall pay fifty percent (50%) of the additional amount directly to the Settlement Fund Administrator and fifty percent (50%) shall be paid out of the Settlement Fund.
D. Settlement Fund Reallocation and Distribution.
As set forth below, within a particular Settling State’s account, amounts contained in the Settlement Fund sub-funds may be reallocated and distributed per a State-Subdivision Agreement or other means. If the apportionment of amounts is not addressed and controlled under Section V.D.1 and Section V.D.2, then the default provisions of Section V.D.4 apply. It is not necessary that a State-Subdivision Agreement or other means of allocating funds pursuant to Section V.D.1 and Section V.D.2 address all of the Settlement Fund sub-funds. For example, a Statutory Trust might only address disbursements from a Settling State’s Remediation Accounts Fund.
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33 1. Distribution by State-Subdivision Agreement. If a Settling State has a State-Subdivision Agreement, amounts apportioned to that Settling State’s State Fund, Remediation Accounts Fund, and Subdivision Fund under Section V.C shall be reallocated and distributed as provided by that agreement. Any State-Subdivision Agreement entered into or amended after the Preliminary Agreement Date shall be applied only if it requires:
(a) that all amounts be used for Opioid Remediation, except as allowed by Section V.B.2, and (b) that at least seventy percent (70%) of amounts be used solely for future Opioid Remediation.10 For a State-Subdivision Agreement to be applied to the relevant portion of the Annual Payment, notice must be provided to CVS and the Settlement Fund Administrator at least ten (10) business days prior to the Settlement Fund Administrator’s disbursements of such portion to a Settlement State and its Participating Subdivisions.
2. Distribution by Allocation Statute. If a Settling State has an Allocation Statute and/or a Statutory Trust that addresses allocation or distribution of amounts apportioned to such Settling State’s State Fund, Remediation Accounts Fund, and/or Subdivision Fund and that, to the extent any or all such sub-funds are addressed, requires (1) all amounts to be used for Opioid Remediation, except as allowed by Section V.B.2, and (2) at least seventy percent (70%) of all amounts to be used solely for future Opioid Remediation,11 then, to the extent allocation or distribution is addressed, the amounts apportioned to that Settling State’s State Fund, Remediation Accounts Fund, and Subdivision Fund under Section V.C shall be allocated and distributed as addressed and provided by the applicable Allocation Statute or Statutory Trust. For the avoidance of doubt, an Allocation Statute or Statutory Trust need not address all three (3) sub-funds that comprise the Settlement Fund, and if the applicable Allocation Statute or Statutory Trust does not address distribution of all or some of these three (3) sub-funds, the applicable Allocation Statute or Statutory Trust does not replace the default provisions described in Section V.D.4 of any such unaddressed fund. For example, if an Allocation Statute or Statutory Trust that meets the requirements of this Section V.D.2 only addresses funds restricted to remediation and abatement, then the default provisions in this Agreement concerning allocation among the three (3) sub-funds comprising the Settlement Fund and the distribution of the State Fund and Subdivision Fund for that Settling State would still apply, while the distribution of the applicable Settling State’s Remediation Accounts Fund would be governed by the qualifying Allocation Statute or Statutory Trust.
3. Voluntary Redistribution. A Settling State may choose to reallocate all or a portion of its State Fund to its Remediation Accounts Fund. A Participating Subdivision included on Exhibit G may choose to reallocate all or a portion of its allocation from the Subdivision Fund to the State’s Remediation Accounts Fund or to another Participating Subdivision. The Settlement Fund Administrator is not required to honor a voluntary 10 Future Opioid Remediation includes amounts paid to satisfy any future demand by another governmental entity to make a required reimbursement in connection with the past care and treatment of a person related to the Alleged Harms.
11 Future Opioid Remediation includes amounts paid to satisfy any future demand by another governmental entity to make a required reimbursement in connection with the past care and treatment of a person related to the Alleged Harms.
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34 redistribution for which notice is provided to it less than sixty (60) calendar days prior to the applicable Payment Date.
4. Distribution in the Absence of a State-Subdivision Agreement, Allocation Statute, or Statutory Trust. If Section V.D.1 and Section V.D.2 do not apply, amounts apportioned to that Settling State’s State Fund, Remediation Accounts Fund, and Subdivision Fund under Section V.C shall be distributed as follows:
a. Amounts apportioned to that Settling State’s State Fund shall be distributed to that State.
b. Amounts apportioned to that Settling State’s Remediation Accounts Fund shall be distributed consistent with Section V.E. Each Settling State shall submit to the Settlement Fund Administrator a designation of a lead state agency or other entity to serve as the single point of contact for that Settling State’s funding requests from the Remediation Accounts Fund and other communications with the Settlement Fund Administrator. The designation of an individual entity is for administrative purposes only and such designation shall not limit funding to such entity or even require that such entity receive funds from this Agreement. The designated entity shall be the only entity authorized to request funds from the Settlement Fund Administrator to be disbursed from that Settling State’s Remediation Accounts Fund. If a Settling State has established a Statutory Trust, then that Settling State’s single point of contact may direct the Settlement Fund Administrator to release the State’s Remediation Accounts Fund to the Statutory Trust.
c. Amounts apportioned to that Settling State’s Subdivision Fund shall be distributed to Participating Subdivisions in that State included on Exhibit G per the Subdivision Allocation Percentage listed in Exhibit G. Section V.F shall govern amounts that would otherwise be distributed to Non-Participating Subdivisions listed in Exhibit G. For the avoidance of doubt and notwithstanding any other provision in this Agreement, no Non-Participating Subdivision will receive any amount from the Settlement Fund, regardless of whether such Subdivision is included on Exhibit G.
d. Special Districts shall not be allocated funds from the Subdivision Fund, except through a voluntary redistribution allowed by Section V.D.3 to Special Districts that are Participating Subdivisions. A Settling State may allocate funds from its State Fund or Remediation Accounts Fund for Special Districts that are Participating Subdivisions.
5. Restrictions on Distribution. No amounts may be distributed from the Subdivision Fund contrary to Section VII, i.e., no amounts may be distributed directly to Non-Participating Subdivisions to the extent such a distribution would violate Section VII.G or Section VII.H. Amounts allocated to the Subdivision Fund that cannot be distributed by virtue of the preceding sentence shall be distributed into the sub-account in the Remediation Accounts Fund for the Settling State in which the Non-Participating WITH TECHNICAL CORRECTIONS 02.03.2023
35 Subdivision is located, unless those payments are redirected elsewhere by a StateSubdivision Agreement described in Section V.D.1 or by an Allocation Statute or a Statutory Trust described in Section V.D.2.
E. Provisions Regarding the Remediation Accounts Fund.
1. State-Subdivision Agreement, Allocation Statute, and Statutory Trust Fund Provisions. A State-Subdivision Agreement, Allocation Statute, or Statutory Trust in a Settling State may govern the operation and use of amounts in that State’s Remediation Accounts Fund so long as it complies with the requirements of Section V.D.1 or Section V.D.2, as applicable, and all direct payments to Participating Subdivisions in that State comply with Section VII.G through Section VII.I.
2. Absence of a State-Subdivision Agreement, Allocation Statute, or Statutory Trust. In the absence of a State-Subdivision Agreement, Allocation Statute, or Statutory Trust that addresses distribution, the Remediation Accounts Fund will be used by a Settling State solely for future Opioid Remediation12 and the following shall apply with respect to a Settling State:
a. Regional Remediation.
(i) At least fifty percent (50%) of distributions for remediation from a Settling State’s Remediation Accounts Fund shall be annually allocated and tracked to the regional level. A Settling State may allow the Advisory Committee established pursuant to Section V.E.2.d to define its regions and assign regional allocations percentages. Otherwise, a Settling State shall (A) define its initial regions, which shall consist of one (1) or more General-Purpose Subdivision(s) and which shall be designated by the state agency with primary responsibility for substance abuse disorder services employing, to the maximum extent practical, existing regions established in that State for opioid abuse treatment or other public health purposes; (B) assign initial regional allocation percentages to the regions based on the Subdivision Allocation Percentages in Exhibit G and an assumption that all Subdivisions included on Exhibit G will become Participating Subdivisions.
(ii) This minimum regional expenditure percentage is calculated using the Settling State’s initial Remediation Accounts Fund allocation and does not include any additional amounts a Settling State has directed to its Remediation Accounts Fund from its State Fund, or any other amounts directed to the fund. A Settling State may dedicate more than fifty percent (50%) of its Remediation Accounts Fund to the regional expenditure and may annually adjust the percentage of its Remediation Accounts Fund 12 Future Opioid Remediation includes amounts paid to satisfy any future demand by another governmental entity to make a required reimbursement in connection with the past care and treatment of a person related to the Alleged Harms.
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36 dedicated to regional expenditures as long as the percentage remains above the minimum amount.
(iii) A Settling State (A) has the authority to adjust the definition of the regions, and (B) may annually revise the percentages allocated to each region to reflect the number of General-Purpose Subdivisions in each region that are Non-Participating Subdivisions.
b. Subdivision Block Grants. Certain Participating Subdivisions shall be eligible to receive regional allocation funds in the form of block grants for future Opioid Remediation. A Participating Subdivision eligible for block grants is a county or parish (or in the case of Settling States that do not have counties or parishes that function as political subdivisions, a city) that (1) does not contain a Litigating Subdivision or a Later Litigating Subdivision for which it has the authority to end the litigation through a release, bar or other action, (2) either (i) has a population of 400,000 or more or (ii) in the case of California has a population of 750,000 or more, and (3) has funded or otherwise managed an established health care or treatment infrastructure (e.g., health department or similar agency). Each Participating Subdivision eligible to receive block grants shall be assigned its own region.
c. Small States. Notwithstanding the provisions of Section V.E.2.a, Settling States with populations under four (4) million that do not have existing regions described in Section V.E.2.a shall not be required to establish regions.
However, such a Settling State that contains one (1) or more Participating Subdivisions eligible for block grants under Section V.E.2.c shall be divided regionally so that each block-grant eligible Participating Subdivision is a region and the remainder of the Settling State is a region.
d. Advisory Committee. A Settling State shall designate an Opioid Settlement Remediation Advisory Committee (the “Advisory Committee”) to provide input and recommendations regarding remediation spending from that Settling State’s Remediation Accounts Fund. A Settling State may elect to use an existing advisory committee or similar entity (created outside of a StateSubdivision Agreement or Allocation Statute); provided, however, the Advisory Committee or similar entity shall meet the following requirements:
(i) Written guidelines that establish the formation and composition of the Advisory Committee, terms of service for members, contingency for removal or resignation of members, a schedule of meetings, and any other administrative details;
(ii) Composition that includes at least an equal number of local representatives as state representatives;
(iii) A process for receiving input from Participating
Subdivisions and other communities regarding how the opioid crisis is WITH TECHNICAL CORRECTIONS 02.03.2023
37 affecting their communities, their abatement needs, and proposals for abatement strategies and responses; and
(iv) A process by which Advisory Committee recommendations for expenditures for Opioid Remediation will be made to and considered by the appropriate state agencies.
3. Remediation Accounts Fund Reporting. The Settlement Fund Administrator shall track and assist in the report of remediation disbursements as agreed to between CVS and the Enforcement Committee.
F. Nature of Payment. CVS, the Settling States, and the Participating Subdivisions each acknowledge and agree that notwithstanding anything to the contrary in this Agreement, including, but not limited to, the scope of the Released Claims:
1. They have entered into this Agreement to avoid the delay, expense, inconvenience, and uncertainty of further litigation;
2. (a) The Settling States and Participating Subdivisions sought compensatory restitution and remediation (within the meaning of 26 U.S.C. § 162(f)(2)(A) and 26 C.F.R. § 1.162-21(e)(4)(i), (ii)) as damages for the Alleged Harms allegedly suffered by the Settling States and Participating Subdivisions; (b) the Total Remediation Amount is less than or equal to the amount, in the aggregate, of the Alleged Harms allegedly suffered by the Settling States and Participating Subdivisions; and (c) the portion of the Total Remediation Amount received by each Settling State or Participating Subdivision is less than or equal to the amount of the Alleged Harms allegedly suffered by such Settling State or Participating Subdivision;
3. The payment of the Total Remediation Amount by CVS constitutes, and is paid for, compensatory restitution and remediation (within the meaning of 26 U.S.C. § 162(f)(2)(A) and 26 C.F.R. § 1.162-21(e)(4)(i), (ii)) for alleged damage or harm (as compensation for alleged damage or harm arising out of alleged bodily injury) allegedly caused by CVS in order to restore, in whole or in part, the Settling States, Participating Subdivisions, and persons to the same position or condition that they would be in had the Settling States, Participating Subdivisions, and persons not suffered the Alleged Harms, and constitutes compensatory restitution and remediation for alleged damage or harm allegedly caused by the potential violation of a law and/or is an amount paid to come into compliance with the law; and
4. For the avoidance of doubt: (a) the entire Total Remediation Amount is properly characterized as described in Section V.F, (b) no portion of the Total Remediation Amount represents reimbursement to any Settling State or Participating Subdivision or other person or entity for the fees or costs of any investigation or litigation, including without limitation attorneys’ fees, (c) no portion of the Global Settlement Amount constitutes the disgorgement of any allegedly ill-gotten gains, and (d) no portion of the Global Settlement Amount is paid for, is in place of, or is properly characterized as the payment of any fine, penalty, punitive damages, or other punitive assessments.
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38 VI. Enforcement
A. Enforceability. This Agreement is enforceable only by the Settling States and CVS; provided, however, that Released Entities may enforce Section XI and Participating Subdivisions listed on Exhibit G have the enforcement rights described in Section VI.D. Except to the extent allowed by the Injunctive Relief Terms, Settling States and Participating Subdivisions shall not have enforcement rights with respect to either the terms of this Agreement that apply only to or in other States or any Consent Judgment entered into by another Settling State. Participating Subdivisions shall not have enforcement rights against CVS with respect to this Agreement or any Consent Judgment except that Participating Subdivisions shall have enforcement rights as set forth herein as to payments that would be allocated to the Subdivision Fund or Remediation Accounts Fund pursuant to Section V; provided, however, that each Settling State shall allow Participating Subdivisions in such Settling State to notify it of any perceived violations of this Agreement or the applicable Consent Judgment.
B. Jurisdiction. CVS consents to the jurisdiction of the court in each Settling State in which the Consent Judgment is filed, limited to and for the sole and exclusive purpose of resolution of disputes identified in Section VI.F.2 for resolution in that court.
C. Specific Terms Dispute Resolution.
1. Any dispute that is addressed by the provisions set forth in the Injunctive Relief Terms shall be resolved as provided therein.
2. In the event that CVS believes that the requirements established in Section V.B.1 are not being satisfied, CVS may request that CVS and the Enforcement Committee meet and confer regarding the use of funds to implement Section V.B.1. The completion of such meet-and-confer process is a precondition to further action regarding any such dispute. Further action concerning Section V.B.1 shall: (i) be limited to CVS obtaining a reduction of its Annual Payments by no more than five percent (5%) of the difference between the actual amount of Opioid Remediation and the 95.5% of CVS’s maximum payment amounts pursuant to Section IV as set forth on Exhibit M-1 over the entirety of all Payment Years (but not in any single Payment Year); (ii) only reduce Annual Payments to those Settling States and their Participating Subdivisions that are out of compliance with the requirements established in Section V.B.1; and (iii) not reduce Annual Payments restricted to future Opioid Remediation.
D. State-Subdivision Enforcement.
1. A Subdivision shall not have enforcement rights against a Settling State in which it is located with respect to this Agreement or any Consent Judgment except that a Participating Subdivision listed on Exhibit G shall have enforcement rights (a) as provided for in a State-Subdivision Agreement, Allocation Statute, or Statutory Trust with respect to intrastate allocation; or (b) in the absence of a State-Subdivision Agreement, Allocation Statute, or Statutory Trust, to address allegations that (i) the Settling State’s use of Remediation Accounts Fund monies were not used for uses similar to or in the nature of those uses contained in Exhibit E, or (ii) a Settling State failed to pay funds directly from WITH TECHNICAL CORRECTIONS 02.03.2023
39 the Remediation Accounts Fund to a Participating Subdivision eligible to receive a block grant pursuant to Section V.E.2.b.
2. A Settling State shall have enforcement rights against a Participating Subdivision located in its territory (a) as provided for in a State-Subdivision Agreement, Allocation Statute, or Statutory Trust; or (b) in the absence of a State-Subdivision Agreement, Allocation Statute, or Statutory Trust, to address allegations that the Participating Subdivisions’ uses of Remediation Accounts Fund monies were not used for purposes similar to or in the nature of those uses contained in Exhibit E.
3. As between Settling States and Participating Subdivisions, the above rights are contractual in nature and nothing herein is intended to limit, restrict, change or alter any other existing rights under law.
E. Subdivision Payment Enforcement. A Participating Subdivision listed on Exhibit G shall have the same right as a Settling State pursuant to Section VI.F.3.a(iv) to seek resolution regarding the failure by CVS to make its allocable share of an Annual Payment in a Payment Year.
F. Other Terms Regarding Dispute Resolution.
1. Except as provided by Section VI.C, the parties to a dispute shall promptly meet and confer in good faith to resolve any dispute. If the parties cannot resolve the dispute informally, and unless otherwise agreed in writing, they shall follow the remaining provisions of this Section VI.F to resolve the dispute.
2. Except to the extent provided by Section VI.C or Section VI.F.3, all disputes shall be resolved in either the court that entered the relevant Consent Judgment or, if no such Consent Judgment was entered, a state or territorial court with jurisdiction located wherever the seat of the relevant state government is located. a. State court proceedings shall be governed by the rules and procedures of the relevant forum.
b. For the avoidance of doubt, disputes to be resolved in state court include, but are not limited to, the following:
(i) disputes concerning whether expenditures qualify as Opioid Remediation;
(ii) disputes between a Settling State and its Participating Subdivisions as provided by Section VI.D, except to the extent the StateSubdivision Agreement provides for other dispute resolution mechanisms.
For the avoidance of doubt, disputes between a Settling State and any Participating Subdivision shall not be considered National Disputes; (iii) whether this Agreement and relevant Consent Judgment are binding under state law;
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40 (iv) the extent of the Attorney General’s or other participating entity’s authority under state law, including the extent of the authority to release claims;
(v) whether the definition of a Bar, a Case-Specific Resolution, Final Order, lead state agency as described in Section V.D.4.b, Later Litigating Subdivision, Litigating Subdivision, or Threshold Motion has been met; and
(vi) all other disputes not specifically identified in Section VI.C or Section VI.F.3.
c. Any Party may request that the National Arbitration Panel provide an interpretation of any provision of the Agreement that is relevant to the state court determination, and the National Arbitration Panel shall make reasonable best efforts to supply such interpretation within the earlier of thirty (30) calendar days or the time period required by the state court proceedings. Any Party may submit that interpretation to the state court to the extent permitted by, and for such weight provided by, the state court’s rules and procedures. If requested by a Party, the National Arbitration Panel shall request that its interpretation be accepted in the form of an amicus curiae brief, and any attorneys’ fees and costs for preparing any such filing shall be paid for by the requesting Party.
3. National Disputes involving a Settling State, a Participating Subdivision that has enforcement rights pursuant to Section VI.A, and/or CVS (together, “Participating Parties”) shall be resolved by the National Arbitration Panel. a. National Disputes are disputes that are not addressed by Section VI.C, and which are exceptions to Section VI.F.2’s presumption of resolution in state courts because they involve issues of interpretation of terms contained in this Agreement applicable to all Settling States without reference to a particular State’s law. Disputes between a Settling State and any Participating Subdivision shall not be considered National Disputes. National Disputes are limited to the following:
(i) The amount of withholding attributable to Non-Settling States;
(ii) issues involving the scope and definition of Product; (iii) interpretation and application of the terms “Alleged Harms,” “Covered Conduct,” “Released Entities,” and “Released Claims”; (iv) the failure by CVS to pay the Annual Payment, the
Additional Remediation Amount in a Payment Year, or the amounts due pursuant to Exhibit S and Exhibit T, but for the avoidance of doubt, disputes between CVS and a Settling State over the amounts owed only to that WITH TECHNICAL CORRECTIONS 02.03.2023
41 Settling State that do not affect any other Settling State shall not be considered National Disputes;
(v) the interpretation and application of any most-favorednation provision in Section XIII.E; (vi) questions regarding the performance and/or removal of the Settlement Fund Administrator;
(vii) disputes involving liability of successor entities; (viii) disputes that require a determination of the sufficiency of participation in order to qualify for Incentive Payments A, B, C or D; (ix) disputes requiring the interpretation of Agreement terms that are national in scope or impact, which shall mean disputes requiring the interpretation of Agreement terms that (i) concretely affect four (4) or more Settling States; and (ii) do not turn on unique definitions and interpretations under state law; and
(x) any dispute subject to resolution under Section VI.F.2 but for which all Participating Parties to the dispute agree to arbitration before the National Arbitration Panel under the provisions of this SectionVI.F.3. b. The National Arbitration Panel shall be comprised of three (3) arbitrators. One (1) arbitrator shall be chosen by CVS, one (1) arbitrator shall be chosen by the Enforcement Committee with due input from Participating Subdivisions listed on Exhibit G, and the third arbitrator shall be agreed upon by the first two (2) arbitrators. The membership of the National Arbitration Panel is intended to remain constant throughout the term of this Agreement, but in the event that replacements are required, the retiring arbitrator shall be replaced by the party that selected him/her.
c. The National Arbitration Panel shall make reasonable best efforts to decide all matters within one hundred eighty (180) calendar days of filing, and in no event shall it take longer than one (1) year.
d. The National Arbitration Panel shall conduct all proceedings in a reasonably streamlined process consistent with an opportunity for the Participating Parties to be heard. Issues shall be resolved without the need for live witnesses where feasible, and with a presumption in favor of remote participation to minimize the burdens on the Participating Parties.
e. To the extent allowed under state law, a Settling State, a Participating Subdivision that has enforcement rights pursuant to Section VI.A, and (at any Participating Party’s request) the National Arbitration Panel may certify to an appropriate state court any question of state law. The National Arbitration Panel WITH TECHNICAL CORRECTIONS 02.03.2023
42 shall be bound by a final state court determination of such a certified question. The time period for the arbitration shall be tolled during the course of the certification process.
f. The arbitrators will give due deference to any authoritative interpretation of state law, including any declaratory judgment or similar relief obtained by a Settling State, a Participating Subdivision that has enforcement rights pursuant to Section VI.A, or CVS on a state law issue.
g. The decisions of the National Arbitration Panel shall be binding on Settling States, Participating Subdivisions, CVS, and the Settlement Fund Administrator. In any proceeding before the National Arbitration Panel involving a dispute between a Settling State and CVS whose resolution could prejudice the rights of a Participating Subdivision(s) in that Settling State, such Participating Subdivision(s) shall be allowed to file a statement of view in the proceeding. h. Nothing herein shall be construed so as to limit or otherwise restrict a Settling State from seeking injunctive or other equitable relief in state court to protect the health, safety, or welfare of its citizens. i. Each Participating Party shall bear its own costs in any arbitration or court proceeding arising under this Section VI. The costs for the arbitrators on the National Arbitration Panel shall be divided and paid equally by the disputing sides for each individual dispute, e.g., a dispute between CVS and Settling States/Participating Subdivisions shall be split fifty percent (50%) by CVS and fifty percent (50%) by the Settling States/Participating Subdivisions that are parties to the dispute; a dispute between a Settling State and a Participating Subdivision shall be split fifty percent (50%) by the Settling State that is party to the dispute and fifty percent (50%) by any Participating Subdivisions that are parties to the dispute.
4. Prior to initiating an action to enforce pursuant to this Section VI.F, the complaining Participating Party must:
a. Provide written notice to the Enforcement Committee of its complaint, including the provision of the Consent Judgment and/or Agreement that the practice appears to violate, as well as the basis for its interpretation of the disputed provision. The Enforcement Committee shall establish a reasonable process and timeline for obtaining additional information from the involved parties; provided, however, that the date the Enforcement Committee establishes for obtaining additional information from the Participating Parties shall not be more than forty-five (45) calendar days following the notice. The Enforcement Committee may advise the Participating Parties of its views on the complaint and/or seek to resolve the complaint informally.
b. Wait to commence any enforcement action until thirty (30) calendar days after the date that the Enforcement Committee establishes for obtaining additional information from the Participating Parties.
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43 5. If the Participating Parties to a dispute cannot agree on the proper forum for resolution of the dispute under the provisions of Section VI.F.2 or SectionVI.F.3, a committee comprising the Enforcement Committee and sufficient representatives of CVS, such that the members of the Enforcement Committee have a majority of one (1) member, will determine, within twenty-eight (28) calendar days of receiving notification of the dispute relating to the proper forum, the forum where the dispute will be initiated. The forum identified by such committee shall be the sole forum for resolving the issue of which forum will hear the substantive dispute, and the committee’s identification of such forum in the first instance shall not be entitled to deference by the forum selected.
G. No Effect. Nothing in this Agreement shall be interpreted to limit the Settling States’ Civil Investigative Demand (“CID”) or investigative subpoena authority, to the extent such authority exists under applicable state law and the CID or investigative subpoena is issued pursuant to such authority, and CVS reserves all of its rights in connection with a CID or investigative subpoena issued pursuant to such authority.
VII. Participation by Subdivisions
A. Notice. Prior to the State Participation Date, the Parties shall agree on a vendor to serve as the Implementation Administrator and provide notice pursuant to this Section VII.A. No later than fifteen (15) calendar days after the Preliminary Agreement Date, the Implementation Administrator shall send individual written notice (which may be delivered via e-mail or other electronic means) of the opportunity to participate in this Agreement and the requirements of participation to all Subdivisions in the Settling States that are (1) Litigating Subdivisions or (2) Non-Litigating Subdivisions listed on Exhibit G. To the extent a Special District is entitled to an allocation for a direct payment through its inclusion in Exhibit G pursuant to a State-Subdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution, the Implementation Administrator, with the cooperation of the Settling States shall also send individual written notice (which may be delivered via e-mail or other electronic means) of the opportunity to participate in this Agreement and the requirements of participation to such Special Districts. Unless otherwise agreed by the Parties, the version of Exhibit G used for notice shall be the one in place as of the State Participation Date. Notice (which may be delivered via e-mail or other electronic means) shall also be provided simultaneously to counsel of record for Litigating Subdivisions and known counsel for Non-Litigating Subdivisions and Special Districts listed on Exhibit G. The Settling States also may provide general notice reasonably calculated to alert Non-Litigating Subdivisions in the Settling States to this Agreement, the opportunity to participate in it, and the requirements for participation. Such Notice may include publication and other standard forms of notification, as well as notice to national state and county organizations such as the National Association of Counties and the National League of Cities. All notice provided under this subsection will include that the deadline for becoming a Participating Subdivision is the Initial Subdivision Participation Date. Nothing contained herein shall preclude a Settling State from providing further notice to or otherwise contacting any of its Subdivisions about becoming a Participating Subdivision, including beginning any of the activities described in this paragraph prior to the Preliminary Agreement Date.
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44 B. Requirements for Becoming a Participating Subdivision⸺Non-Litigating Subdivisions. A Non-Litigating Subdivision in a Settling State may become a Participating Subdivision by returning an executed Subdivision Participation Agreement to the Implementation Administrator or Settlement Fund Administrator (which may be executed and returned by electronic means established by the Implementation Administrator or Settlement Fund Administrator) specifying (1) that the Subdivision agrees to the terms of this Agreement pertaining to Subdivisions, (2) that the Subdivision releases all Released Claims against all Released Entities, (3) that the Subdivision agrees to use monies it receives, if any, from the Settlement Fund pursuant to the applicable requirements of Section V; provided, however, that Non-Litigating Subdivisions may only use monies originating from the Settlement Fund for purposes that qualify as Opioid Remediation, and (4) that the Subdivision submits to the jurisdiction of the court where the applicable Consent Judgment is filed for purposes limited to that court’s role under this Agreement. The required Subdivision Participation Agreement is attached as Exhibit K.
C. Requirements for Becoming a Participating Subdivision⸺Litigating Subdivisions/Later Litigating Subdivisions. A Litigating Subdivision or Later Litigating Subdivision in a Settling State may become a Participating Subdivision by returning an executed Subdivision Participation Agreement to the Implementation Administrator or Settlement Fund Administrator (which may be executed and returned by electronic means established by the Implementation Administrator or Settlement Fund Administrator) and upon prompt dismissal with prejudice of its lawsuit following the Reference Date or the date on which the conditions for effectiveness in Section VIII.C have been met, whichever is later. Following its execution of a Subdivision Participation Agreement, a Litigating Subdivision shall take reasonable steps to immediately cease all litigation activity against the Released Entities, where feasible, or to minimize such activity by means of agreed deadline extensions and agreed postponement of depositions, document productions, and motion practice, unless the Litigating Subdivision reasonably concludes that it would be prejudiced by doing so. A Settling State may require each Litigating Subdivision in that State to specify on the Subdivision Participation Agreement whether its counsel has waived any contingency fee contract with that Participating Subdivision and whether, if eligible, it intends to seek fees pursuant to Exhibit R. The Settlement Fund Administrator shall provide quarterly reports of this information to the parties organized by Settling State. A Litigating Subdivision or Later Litigating Subdivision may not become a Participating Subdivision after the completion of opening statements in a trial of the lawsuit it brought that includes a Released Claim against a Released Entity. For avoidance of doubt, where a subdivision official other than a General-Purpose Government has filed a lawsuit that includes a Released Claim against a Released Entity in a direct, parens patriae, or any other capacity, that Subdivision may become a Participating Subdivision only if, in addition to the other requirements of this Section VII.C, the lawsuit filed by the subdivision official has also been dismissed with prejudice.
D. Initial Participating Subdivisions. A Subdivision qualifies as an Initial Participating Subdivision if it meets the applicable requirements for becoming a Participating Subdivision set forth in Section VII.B or Section VII.C by the Initial Subdivision Participation Date. All Subdivision Participation Agreements returned to the Implementation Administrator shall be held in escrow by the Implementation Administrator until the Reference Date. Subdivision Participation Agreements returned to the Implementation Administrator shall not be withdrawn WITH TECHNICAL CORRECTIONS 02.03.2023
45 unless notice of the withdrawal is provided to the Implementation Administrator within eighteen (18) days after the Initial Subdivision Participation Date. If, for any reason, the Agreement does not become effective, all obligations created by such forms and releases in them shall be void ab initio and all Subdivision Participation Agreements shall be returned to Counsel for Litigating Subdivisions or to the Subdivisions not represented by counsel or destroyed to the extent that such destruction is not prohibited by then existing document preservation obligations.
E. Later Participating Subdivisions. A Subdivision in a Settling State that is not an Initial Participating Subdivision may become a Later Participating Subdivision by meeting the applicable requirements for becoming a Participating Subdivision set forth in Section VII.B or Section VII.C after the Initial Subdivision Participation Date and by agreeing to be subject to the terms of a State-Subdivision Agreement (if any) or any other structure adopted or applicable pursuant to Section V.D or Section V.E. The following provisions govern what a Later Participating Subdivision can receive (but do not apply to Initial Participating Subdivisions):
1. A Later Participating Subdivision shall not receive any share of any Annual Payment due before it became a Participating Subdivision.
2. A Subdivision that becomes a Later Participating Subdivision after November 30, 2023 shall receive seventy-five percent (75%) of the share of future base or incentive payments that it would have received had it become a Later Participating Subdivision prior to that date (unless the Later Participating Subdivision is subject to Section VII.E.3 or Section VII.E.4).
3. A Later Participating Subdivision that, after the Initial Subdivision Participation Date, maintains a lawsuit for a Released Claim(s) against a Released Entity and has judgment entered against it on every such Claim before it became a Participating Subdivision (other than a consensual dismissal with prejudice) is not eligible to become a Participation Subdivision.
4. A Subdivision that becomes a Later Participating Subdivision while a Bar or Case-Specific Resolution involving a different Subdivision exists in its State shall receive twenty-five percent (25%) of the share of future base or incentive payments that it would have received had it become a Later Participating Subdivision without such Bar or Case-Specific Resolution.
F. No Increase in Payments. Amounts to be received by Later Participating Subdivisions shall not increase the payments due from CVS.
G. Ineligible Subdivisions. Subdivisions in Non-Settling States and Prior Litigating Subdivisions are not eligible to be Participating Subdivisions.
H. Non-Participating Subdivisions. Non-Participating Subdivisions shall not directly receive any portion of any Annual Payment, including from the State Fund and direct distributions from the Remediation Accounts Fund; however, a Settling State may choose to fund future Opioid Remediation that indirectly benefits Non-Participating Subdivisions.
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46 I. Unpaid Allocations to Later Participating Subdivisions and Non-Participating Subdivisions. Any base payments and incentive payments allocated pursuant to Section V.D to a Later Participating Subdivision or Non-Participating Subdivision that cannot be paid pursuant to this Section VII, including the amounts that remain unpaid after the reductions required by Section VII.E.2 through Section VII.E.4, will be allocated to the Remediation Accounts Fund for the Settling State in which the Non-Participating Subdivision is located, unless those payments are redirected elsewhere by a State-Subdivision Agreement or by a Statutory Trust.
VIII. Condition to Effectiveness of Agreement and Filing of Consent Judgment A. Distribution of Subdivision Participation Agreements. No later than three (3) calendar days after the Initial Subdivision Participation Date, the Implementation Administrator shall report to the Settling States and CVS on which Subdivisions in the Settling States have and have not executed Subdivision Participation Agreements and shall provide notice under Section XIII.Q of any withdrawals of Subdivision Participation Agreements within one (1) business day of the withdrawal. The Settling States and CVS each shall have online access to the Subdivision Participation Agreements for the purpose of auditing the Implementation Administrator’s reports but may not maintain copies. CVS shall pay up to and no more than $1.5 million of the Implementation Administrator’s fees and costs, including advancing such fees and costs prior to the Effective Date. If this Agreement becomes effective, then CVS may deduct from its Annual Payment for Payment Year 2 any amount in excess of $1.5 million it paid for the Implementation Administrator’s fees and costs.
B. Determination to Proceed with Settlement—Settling States. Following the Initial Subdivision Participation Date, the Settling States on the Enforcement Committee shall determine whether to proceed with the Agreement. No later than fifteen (15) calendar days prior to the Reference Date, the Settling States shall provide notice to CVS and the Enforcement Committee of their decision. If the Settling States elect not to proceed, this Agreement will have no further effect, and all releases (including those contained in Subdivision Participation Agreements) and other commitments or obligations contained herein or in Subdivision Settlement Participation Forms will be void.
C. Determination to Proceed with Settlement—CVS. If the Settling States elect to proceed, CVS shall then determine whether to proceed with the Agreement. This determination shall be in CVS’s sole discretion and may be based on any criteria or factors it deems relevant.
CVS shall provide notice to the Settling States and the Enforcement Committee of its decision no later than the Reference Date. If CVS elects to proceed with the Agreement, the Parties will proceed to file the Consent Judgments, and the obligations in the State Participation Forms and the Subdivision Participation Agreements will become effective as of the Reference Date. If CVS elects not to proceed, this Agreement will have no further effect, and all releases (including those contained in Subdivision Participation Agreements) and other commitments or obligations contained herein or in Subdivision Participation Agreements will be void.
IX. Additional Remediation
A. Additional Remediation Amount. Subject to and without exceeding the maximum payment amounts set forth in the “Additional Remediation Amount” column of Exhibit M-3 and WITH TECHNICAL CORRECTIONS 02.03.2023
47 subject to the reduction specified in Section IX.B, CVS shall pay an Additional Remediation Amount to the Settling States listed in Exhibit N. Such funds shall be paid, on the schedule set forth in Exhibit M-3, on the Payment Date for each relevant Payment Year to such Settling States as allocated by the Settlement Fund Administrator pursuant to Exhibit N.
B. Reduction of Additional Remediation Amount. The amounts owed by CVS pursuant to this Section IX shall be reduced by the allocations set forth on Exhibit N for NonSettling States.
C. For the avoidance of doubt, (1) a Settling State that retained outside counsel in connection with opioid investigations that receives an Additional Remediation Amount because the Settling State was not otherwise eligible to receive funds from the State Outside Counsel Fee Fund may choose to have the Additional Remediation Amount designated to pay the Settling State’s outside counsel, and may instruct the Settlement Fund Administrator to pay those funds directly to the Settling State’s outside counsel, and (2) Additional Remediation Amount funds, including funds designated by a Settling State to pay its outside counsel under this paragraph, shall not be subject to allocation as provided in Section V.C through Section V.E.
X. Plaintiffs’ Attorneys’ Fees and Costs
The Agreement on Attorneys’ Fees, Expenses and Costs is set forth in Exhibit R and incorporated herein by reference. CVS shall pay subdivision attorneys’ fees and costs into the Subdivision Attorney’s Fee and Subdivision Cost and Expense Fund as set forth in Exhibit R and Exhibit M-3. The Agreement on the State Outside Counsel Fee Fund and Agreement on the Joint State Cost Fund are set forth in Exhibit S and Exhibit T, respectively, and are incorporated herein by reference. Attorneys’ fees, expenses and costs shall not exceed the maximum annual and total amounts set forth in the relevant columns of Exhibits M-1 and M-3 and shall be subject to reduction as set forth in Exhibit R, Exhibit S, and Exhibit T.
XI. Release
A. Scope. As of the Effective Date, the Released Entities are hereby released and forever discharged from all of the Releasors’ Released Claims. Each Settling State (for itself and its Releasors) and Participating Subdivision (for itself and its Releasors) hereby absolutely, unconditionally, and irrevocably covenants not to bring, file, or claim; or to cause, assist in bringing or permit to be brought, filed, or claimed; or to otherwise seek to establish liability for any Released Claim against any Released Entity in any forum whatsoever. The releases provided for in this Agreement are broad, shall be interpreted so as to give the Released Entities the broadest possible bar against any liability relating in any way to any Released Claim, and extend to the full extent of the power of each Settling State and its Attorney General to release claims. This Agreement shall be a complete bar to any Released Claim.
B. Claim-Over and Non-Party Settlement.
1. It is the intent of the Parties that:
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48 a. Released Entities should not seek contribution or indemnification (other than pursuant to an insurance contract), from other parties for their payment obligations under this Agreement;
b. the payments made under this Agreement shall be the sole payments made by the Released Entities to the Releasors involving, arising out of, or related to Alleged Harms and/or Covered Conduct (or conduct that would be Covered Conduct if engaged in by a Released Entity);
c. Claims by Releasors against non-Parties shall not result in additional payments by Released Entities, whether through contribution, indemnification or any other means; and
d. the Agreement meets the requirements of the Uniform Contribution Among Joint Tortfeasors Act and any similar state law or doctrine that reduces or discharges a released party’s liability to any other parties.
The provisions of this Section XI.B are to be implemented consistent with these principles.
This Agreement and the releases and dismissals provided for herein are made in good faith.
2. No Released Entity shall seek to recover for amounts paid under this Agreement based on indemnification, contribution, or any other theory from a manufacturer, pharmacy, hospital, pharmacy benefit manager, health insurer, third-party vendor, trade association, distributor, or health care practitioner; provided that a Released Entity shall be relieved of this prohibition with respect to any entity that asserts a ClaimOver against it. For the avoidance of doubt, nothing herein shall prohibit a Released Entity from recovering amounts owed pursuant to insurance contracts.
3. If any Releasor enters into a Non-Party Settlement on or after the Effective Date, including in any bankruptcy case or through any plan of reorganization (whether individually or as a class of creditors), the Releasor will include (or in the case of a NonParty Settlement made in connection with a bankruptcy case, will cause the debtor to include), unless prohibited from doing so under applicable law, in the Non-Party Settlement a prohibition on contribution or indemnity of any kind substantially equivalent to that required from CVS in Section XI.B.2, or a release from such Non-Released Entity in favor of the Released Entities (in a form equivalent to the releases contained in this Agreement) of any Claim-Over. The obligation to obtain the prohibition and/or release required by this subsection is a material term of this Agreement.
4. If any Releasor obtains a judgment with respect to a Non-Party Covered Conduct Claim against a Non-Released Entity that does not contain the prohibition described in Section XI.B.3, or any Releasor files a Non-Party Covered Conduct Claim against a Non-Released Entity in bankruptcy or a Releasor is prevented for any reason from obtaining a prohibition/release in a Non-Party Settlement as provided in Section XI.B.3, and such Non-Released Entity asserts a Claim-Over against a Released Entity, the Released Entity shall be relieved of the prohibition in Section XI.B.2 with respect to that NonReleased Entity and that Releasor and CVS shall take the following actions to ensure that WITH TECHNICAL CORRECTIONS 02.03.2023
49 the Released Entities do not pay more with respect to Alleged Harms and/or Covered Conduct to Releasors or to Non-Released Entities than the amounts owed under this Agreement by CVS:
a. CVS shall notify that Releasor of the Claim-Over within sixty (60) calendar days of the assertion of the Claim-Over or sixty (60) calendar days of the Effective Date of this Agreement, whichever is later;
b. CVS and that Releasor shall meet and confer concerning the means to hold Released Entities harmless and ensure that they are not required to pay more with respect to Alleged Harms and/or Covered Conduct than the amounts owed by CVS under this Agreement;
c. That Releasor and CVS shall take steps sufficient and permissible under the law of the State of the Releasor to hold Released Entities harmless from the Claim-Over and ensure Released Entities are not required to pay more with respect to Alleged Harms and/or Covered Conduct than the amounts owed by CVS under this Agreement. Such steps may include, where permissible:
(i) Filing of motions to dismiss or such other appropriate motion by CVS or Released Entities, and supported by Releasors, in response to any claim filed in litigation or arbitration; (ii) Reduction of that Releasors’ Claim and any judgment it has obtained or may obtain against such Non-Released Entity by whatever amount is necessary to extinguish such Claim-Over under applicable law, up to the amount that Releasor has obtained, may obtain, or has authority to control from such Non-Released Entity;
(iii) Placement into escrow of funds paid by the Non-Released Entities such that those funds are available to satisfy the Claim-Over; (iv) Return of monies paid by CVS to that Releasor under this Agreement to permit satisfaction of a judgment against or settlement with the Non-Released Entity to satisfy the Claim-Over;
(v) Payment of monies to CVS by that Releasor to ensure CVS is held harmless from such Claim-Over, up to the amount that Releasor has obtained, may obtain, or has authority to control from such Non-Released Entity;
(vi) Credit to CVS under this Agreement to reduce the overall amounts to be paid under the Agreement such that it is held harmless from the Claim-Over; and
(vii) Such other actions as that Releasor and CVS may devise to hold CVS harmless from the Claim-Over.
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50 d. The actions of that Releasor and CVS taken pursuant to clause (c) above must, in combination, ensure CVS is not required to pay more with respect to Alleged Harms and/or Covered Conduct than the amounts owed by CVS under this Agreement.
e. In the event of any dispute over the sufficiency of the actions taken pursuant to clause (c) above, Releasor and CVS may seek review by the National Arbitration Panel, or, upon consent of the parties to the dispute, by the state court where the relevant Consent Judgment was filed. The National Arbitration Panel shall have authority to order a remedy, including one or more of the actions specified in clause (c), sufficient to hold Released Entities fully harmless. In the event that the Panel’s actions do not result in Released Entities being held fully harmless, CVS shall have a claim for breach of this Agreement by Releasors, with the remedy being payment of sufficient funds to hold CVS harmless from the Claim-Over. For the avoidance of doubt, the prior sentence does not limit or eliminate any other remedy that CVS may have.
5. To the extent that the Claim-Over is based on a contractual indemnity, the obligations under Section XI.B.4 shall extend solely to a Non-Party Covered Conduct Claim against a pharmacy, distributor, clinic, hospital or other purchaser or dispenser of Products, a manufacturer that sold Products, a consultant, and/or a pharmacy benefit manager or other third-party payor. CVS shall notify the Settling States, to the extent permitted by applicable law, in the event that any of these types of Non-Released Entity asserts a Claim-Over arising out of contractual indemnity against it.
C. Indemnification and Contribution Prohibited. No Released Entity shall seek to recover for amounts paid under this Agreement based on indemnification, contribution, or any other theory, from a manufacturer, pharmacy, hospital, pharmacy benefit manager, health insurer, third-party vendor, trade association, distributor, or health care practitioner; provided that a Released Entity shall be relieved of this prohibition with respect to any entity that asserts a ClaimOver against it. For the avoidance of doubt, nothing herein shall prohibit a Released Entity from recovering amounts owed pursuant to insurance contracts. For the avoidance of doubt, nothing herein shall prohibit a Released Entity from recovering amounts owed pursuant to insurance contracts.
D. General Release. In connection with the releases provided for in this Agreement, each Settling State (for itself and its Releasors) and Participating Subdivision (for itself and its Releasors) expressly waives, releases, and forever discharges any and all provisions, rights, and benefits conferred by any law of any State or territory of the United States or other jurisdiction, or principle of common law, which is similar, comparable, or equivalent to § 1542 of the California Civil Code, which reads:
General Release; extent. A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and WITH TECHNICAL CORRECTIONS 02.03.2023
51 that if known by him or her, would have materially affected his or her settlement with the debtor or released party.
A Releasor may hereafter discover facts other than or different from those which it knows, believes, or assumes to be true with respect to the Released Claims, but each Settling State (for itself and its Releasors) and Participating Subdivision (for itself and its Releasors) hereby expressly waives and fully, finally, and forever settles, releases and discharges, upon the Effective Date, any and all Released Claims that may exist as of such date even if Releasors do not know or suspect such claims to exist, whether through ignorance, oversight, error, negligence or through no fault whatsoever, and even if knowledge of the existence of such claims would materially affect the Settling States’ decision to enter into this Agreement or the Participating Subdivisions’ decision to participate in this Agreement.
E. Assigned Interest Waiver. To the extent that any Settling State has any direct or indirect interest in any rights of a third-party that is a debtor under the Bankruptcy Code as a result of a claim arising out of Covered Conduct or Alleged Harms by way of assignment or otherwise, including as a result of being the beneficiary of a trust or other distribution entity, to assert claims against CVS (whether derivatively or otherwise), under any legal or equitable theory, including for indemnification, contribution, or subrogation, such Settling State waives the right to assert any such claim, or to receive a distribution or any benefit on account of such claim and such claim, distribution, or benefit shall be deemed assigned to CVS.
F. Res Judicata. Nothing in this Agreement shall be deemed to reduce the scope of the res judicata or claim preclusive effect that the settlement memorialized in this Agreement, and/or any Consent Judgment or other judgment entered on this Agreement, gives rise to under applicable law.
G. Representation and Warranty. The signatories hereto on behalf of their respective Settling States expressly represent and warrant that they have (or will obtain no later than the Initial Subdivision Participation Date) the authority to settle and release, to the maximum extent of the State’s power, all Released Claims of (1) their respective Settling States, (2) all past and present executive departments, state agencies, divisions, boards, commissions and instrumentalities with the regulatory authority to enforce state and federal controlled substances acts, and (3) any of their respective Settling State’s past and present executive departments, agencies, divisions, boards, commissions and instrumentalities that have the authority to bring Claims related to Alleged Harms and/or Covered Conduct seeking money (including abatement and/or remediation) or revocation of a pharmaceutical distribution or dispensing license. For the purposes of clause (3) above, executive departments, agencies, divisions, boards, commissions, and instrumentalities are those that are under the executive authority or direct control of the State’s Governor. Also for the purposes of clause (3), a release from a State’s Governor, to be materially similar to that in Exhibit X, is sufficient to demonstrate that the appropriate releases have been obtained.
H. Effectiveness. The releases set forth in this Agreement shall not be impacted in any way by any dispute that exists, has existed, or may later exist between or among the Releasors.
Nor shall such releases be impacted in any way by any current or future law, regulation, ordinance, or court or agency order limiting, seizing, or controlling the distribution or use of the Settlement WITH TECHNICAL CORRECTIONS 02.03.2023
52 Fund or any portion thereof, or by the enactment of future laws, or by any seizure of the Settlement Fund or any portion thereof.
I. Cooperation. Settling States will meet and confer with CVS and simultaneously make reasonable efforts to resolve any action filed by a Subdivision involving any Covered Conduct, Alleged Harms, or a Product that remains pending against CVS after the Initial Subdivision Participation Date. Releasors (i) will not encourage any person or entity to bring or maintain any Released Claim against any Released Entity and (ii) will reasonably cooperate with and not oppose any effort by a Released Entity to secure the prompt dismissal of any and all Released Claims.
J. Non-Released Claims. Notwithstanding the foregoing or anything in the definition of Released Claims, this Agreement does not waive, release or limit any criminal liability, Claims for liability under tax law, Claims under securities law by a State Releasor as investor, Claims against parties who are not Released Entities, Claims by private individuals, and any claims arising under this Agreement for enforcement of this Agreement. Nothing in this Agreement precludes the Released Entities from asserting, in an action arising from or relating to Claims by private individuals, any defense or argument based on this Agreement that is available under applicable law.
XII. Later Litigating Subdivisions; Non-Settling States A. Released Claims against Released Entities. If a Later Litigating Subdivision in a Settling State maintains a lawsuit for a Released Claim against a Released Entity after the Initial Subdivision Participation Date, the Released Entity shall take ordinary and reasonable measures to defend the action, including filing a Threshold Motion with respect to the Released Claim. The Released Entity shall further notify the Settling State and Settlement Fund Administrator immediately upon notice of a Later Litigating Subdivision bringing a lawsuit for a Released Claim and shall not oppose a Settling State’s submission in support of the Threshold Motion. CVS shall give the relevant Settling State a reasonable opportunity to extinguish the Released Claims without any payment or any other obligations being imposed upon any Released Entities (apart from the Global Settlement Amount payable by CVS under the Agreement or the Injunctive Relief Terms incurred by it). The relevant Settling State and CVS shall confer and use reasonable efforts to promptly resolve the lawsuit so that it is dismissed with prejudice. Nothing in this subsection creates an obligation for a Settling State to make a monetary payment or incur any other obligation to an entity filing a lawsuit.
B. Non-Settling States. Non-Settling States shall not be eligible for any payments or have any rights in connection with this Agreement.
C. Settlement Class Resolution Opt Outs. If a Settling State is eligible for Incentive Payment A on the basis of a Settlement Class Resolution, and a Primary Subdivision that opted out of the Settlement Class Resolution maintains a lawsuit asserting a Released Claim against a Released Entity, the following shall apply. The Released Entity shall take ordinary and reasonable measures to defend the action, including filing a Threshold Motion with respect to the Released Claim. The Settling State shall seek to obtain either dismissal of the lawsuit in cooperation with CVS, or a release of the Primary Subdivision’s claims. If the lawsuit asserting a Released Claim WITH TECHNICAL CORRECTIONS 02.03.2023
53 either survives a Threshold Motion or has an unresolved Threshold Motion fewer than sixty (60) calendar days prior to the scheduled start of a trial involving a Released Claim, and is resolved with finality on terms requiring payment by the Released Entity, CVS shall receive a dollar-fordollar offset for the amount paid against its obligation to make remaining Incentive Payment A payments that would be apportioned to that Settling State and to its Subdivisions.
D. Revoked Bar, Settlement Class Resolution, or Case-Specific Resolution. If CVS made any Annual Payments that included any incentive payments earned as a result of the existence of a Bar, Settlement Class Resolution, or Case-Specific Resolution in a Settling State, and there is subsequently a Revocation Event with respect to that Bar, Settlement Class Resolution, or Case-Specific Resolution after the determination of the amount of such Annual Payment, that Settling State shall seek to obtain a release of the claims impacted by the Revocation Event, including but not limited to defending the legality of the Bar, obtaining a dismissal of the claims made against the Released Entity, and obtaining releases from impacted Subdivisions. If the Settling State is unable to defend the legality of the bar and/or obtain releases form all impacted Subdivisions, then CVS shall receive a dollar-for-dollar offset against the portion of remaining Annual Payments that would be allocated to that Settling State and its Participating Subdivisions.
This offset will be calculated as the dollar amount difference between (1) the total amount of incentive payments paid by CVS by virtue of the Bar, Settlement Class Resolution, or CaseSpecific Resolution subject to the Revocation Event and (2) the total amount of incentive payments that would have been due from CVS during that time had the Bar, Settlement Class Resolution, or Case-Specific Resolution subject to the Revocation Event not been in effect. The amount of incentive payments that would have been due, referenced in clause (2) above, will be calculated one hundred eighty (180) calendar days after the Revocation Event; for purposes of calculating the amount of incentive payments that would have been due, any relevant Subdivision shall be included as a Participating Subdivision if: (1) its Released Claims are extinguished by any subsequent Bar, Settlement Class Resolution, or Case-Specific Resolution in effect as of the date of such calculation, or (2) it becomes a Participating Subdivision (in addition to all other Participating Subdivisions) prior to the date of such calculation.
E. Certain Taxes. Amounts paid by CVS under an Opioid Tax in a Settling State in a Payment Year shall give rise to a dollar-for-dollar offset against CVS’s obligation to pay its share of the Annual Payment in that Payment Year that would be allocated to the taxing Settling State or its Participating Subdivisions. If such amounts paid exceed CVS’s allocable share of the Annual Payment allocable to the taxing Settling State or its Participating Subdivisions in that Payment Year, the excess shall carry forward as an offset against its allocable share of remaining Annual Payments that would be allocated to the taxing Settling State or its Participating Subdivisions.
CVS represents that as of December 2, 2022, there is no Opioid Tax currently in effect in any Eligible State that would give rise to this offset provision.
XIII. Miscellaneous
A. Population of General-Purpose Governments. The population figures for GeneralPurpose Governments shall be the published U.S. Census Bureau’s population estimates for July WITH TECHNICAL CORRECTIONS 02.03.2023
54 1, 2019, released May 2020. These population figures shall remain unchanged during the term of this Agreement.13
B. Population of Special Districts. For any purpose in this Agreement in which the population of a Special District is used other than Section IV.H.6.d and Section IV.H.9.d: (a) School Districts’ populations will be measured by the number of students enrolled who are eligible under the Individuals with Disabilities Education Act (“IDEA”) or Section 504 of the Rehabilitation Act of 1973; (b) Health Districts’ and Hospital Districts’ populations will be measured at twenty-five percent (25%) of discharges; and (c) all other Special Districts’ (including fire districts’ and library districts’) populations will be measured at ten percent (10%) of the population served. For the avoidance of doubt, this means that California healthcare districts will be measured at ten percent (10%) of their membership. CVS and the Enforcement Committee shall meet and confer in order to agree on data sources for purposes of this Section XIII.B prior to the Preliminary Agreement Date.
C. Population Associated with Sheriffs. For any purpose in this Agreement in which the population associated with a lawsuit by a sheriff is used, the population will be measured at twenty percent (20%) of the capacity of the jail(s) operated by the sheriff.
D. No Admission. The Parties intend the settlement as described herein to be a final and complete resolution of all disputes between CVS and all Releasors. CVS is entering into this Agreement solely for the purposes of settlement, to resolve all Actions and Released Claims and thereby avoid significant expense, inconvenience and uncertainty. CVS denies the allegations in the Actions and denies any civil or criminal liability in the Actions. Nothing contained herein may be taken as or deemed to be an admission or concession by CVS of: (i) any violation of any law, regulation, or ordinance; (ii) any fault, liability, or wrongdoing; (iii) the strength or weakness of any Claim or defense or allegation made in any Action, or in any other past, present or future proceeding relating to any Covered Conduct, Alleged Harms, or any Product; (iv) the legal viability of the claims and theories in any Action, including but not limited to the legal viability of the relief sought; or (v) any other matter of fact or law. Nothing in this Agreement shall be construed or used to prohibit any Released Entity from engaging in the conduct of its business relating to any Product in accordance with the Injunctive Relief Terms and applicable laws and regulations.
E. Most-Favored-Nation Provision.
1. If, after the Effective Date, CVS enters into any settlement agreement with any Non-Settling State that resolves Claims similar in scope to the Claims released by a Settling State under this Agreement on overall payment terms that are more favorable to such Non-Settling State than the overall payment terms of the Agreement (after due consideration of relevant differences in population or other appropriate factors), then the Settling States may elect to seek review, pursuant to Section XIII.E.3, of the overall payment terms of this Agreement and the Non-Settling State agreement so that such 13 The estimates for counties and parishes were accessed at https://www.census.gov/data/datasets/timeseries/demo/popest/2010s-countiestotal.html. The estimates for cities and towns can currently be found at https://www.census.gov/data/datasets/time-series/demo/popest/2010s-total-cities-and-towns.html.
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55 Settling State(s) may obtain, with respect to CVS, overall payment terms at least as favorable as those obtained by such Non-Settling State. “Overall payment terms” refers to consideration of all payment terms of the two agreements, taken together, including, but not limited to the amounts of payments, the timing of payments, and conditions or contingencies on payments.
2. For any settlement with a Non-Settling State involving Released Claims that is entered into after the Effective Date, CVS shall provide the Enforcement Committee with a copy of the settlement agreement or relevant consent judgment within thirty (30) calendar days of the consummation of such settlement. The Enforcement Committee will promptly distribute such copy to all Settling States.
3. In the event that one or more Settling State(s) believes that the overall payment terms of an agreement by CVS with a Non-Settling State are more favorable to the Non-Settling State, based on the totality of the considerations set forth in Section XIII.E.1, the Settling State(s) and CVS shall engage in the following process:
a. The Settling State(s) shall provide notice, within sixty (60) calendar days of the date on which a settlement agreement or consent judgment is provided to the Enforcement Committee, to CVS of its (their) intent to seek revision of this Agreement to provide payment terms that are, on an overall basis, as favorable as those obtained by the Non-Settling State. To the extent allowed by law, such notice shall be confidential and not disclosed publicly and shall provide, in detail, the basis for the Settling State’s (Settling States’) belief that it (they) is (are) entitled to a revision of the Agreement.
b. CVS shall, within thirty (30) calendar days, provide a response to the Settling State(s), explaining its position, in detail, as to whether the Settling State(s) is (are) entitled to more favorable overall payment terms than those provided for in this Agreement.
c. In the event the Settling State(s) and CVS do not reach agreement as to the application of Section XIII.E.1, the Settling State(s) may petition the National Arbitration Panel to seek a ruling from the Panel as to the applicability of Section XIII.E.1, provided that the Settling State(s) may seek such review only if at least five (5) Settling States co-sign the petition. The Panel shall consider submissions and argument by the parties pursuant to the procedures set forth in Section VI.F.3.
d. The Settling State(s) and CVS shall be bound by the determination of the National Arbitration Panel.
4. This Section XIII.E does not apply to, and there is no ability of any Settling State to seek or obtain revision of this Agreement based on, any Non-Settling State agreement with CVS that is entered into with: (a) a Non-Settling State after a date ninety (90) calendar days prior to the scheduled start date of a trial between CVS and the NonSettling State or any severed or bifurcated portion thereof, provided that, where, in order WITH TECHNICAL CORRECTIONS 02.03.2023
56 to complete a settlement, a Non-Settling State and CVS jointly request an adjournment of the scheduled start date of a trial within ninety (90) calendar days of that date, this exception will apply as if the trial date had not been adjourned; (b) a Non-Settling State that previously litigated to judgment a case related to opioids against any manufacturer, distributor, or pharmacy; or (c) a Non-Settling State that has obtained any court order or judicial determination that grants judgment (in whole or in part) against CVS. For avoidance of doubt, the National Arbitration Panel shall have no power to review agreements described in this paragraph.
5. This Section XIII.E does not apply to, and there is no ability of any Settling State to seek or obtain revision of this Agreement based on, (a) any agreement between CVS and Non-Participating Subdivisions, and (b) any global tribal settlement or any agreement between CVS and any federally-recognized tribe.
6. This Section XIII.E will not apply to any agreement entered into more than eighteen (18) months after the Effective Date.
F. Tax Cooperation and Reporting.
1. Upon request by CVS, the Settling States and Participating Subdivisions agree to perform such further acts and to execute and deliver such further documents as may be reasonably necessary for CVS to establish the statements set forth in Section V.F to the satisfaction of their tax advisors, their independent financial auditors, the Internal Revenue Service, or any other governmental authority, including as contemplated by Treasury Regulations Section 1.162-21(b)(3)(ii) and any subsequently proposed or finalized relevant regulations or administrative guidance.
2. Without limiting the generality of Section XIII.F.1, each Settling State and Participating Subdivision shall cooperate in good faith with CVS with respect to any tax claim, dispute, investigation, audit, examination, contest, litigation, or other proceeding relating to this Agreement.
3. The Designated State, on behalf of all Settling States and Participating Subdivisions, shall designate one of its officers or employees to act as the “appropriate official” within the meaning of Treasury Regulations Section 1.6050X-1(f)(1)(ii)(B) (the “Appropriate Official”). The Designated State shall direct and ensure that the Appropriate Official timely (a) files (i) at the time this Agreement becomes binding on the Parties, an IRS Form 1098-F in the form attached as Exhibit U with respect to CVS and (ii) any legally required returns or amended returns with any applicable governmental authority, or any returns requested by CVS, and (b) provides to CVS a copy of (i) the IRS Form 1098-F filed with respect to CVS and (ii) any legally required written statement pursuant to any applicable law and any other document referred to in clause (a)(ii) above. Any such form, return, or statement shall be prepared and filed in a manner fully consistent with Section V.F.
4. Any return, amended return, or written statement filed or provided pursuant to Section XIII.F.3, and any similar document, shall be prepared and filed in a manner WITH TECHNICAL CORRECTIONS 02.03.2023
57 consistent with reporting the Global Settlement Amount as the “Total amount to be paid” pursuant to this Agreement in Box 1 of IRS Form 1098-F and the Total Remediation Amount as “Restitution/remediation amount” in Box 3 of IRS Form 1098-F, as reflected in the attached Exhibit U. If the Designated State or Appropriate Official shall be required to file any return, amended return, or written statement contemplated by this Section XIII.F other than an IRS Form 1098-F in the form attached as Exhibit U, the Designated State shall direct and ensure that the Appropriate Official provides to CVS a draft of such return, amended return, or written statement no later than sixty (60) calendar days prior to the due date thereof, and shall accept any reasonable revisions from CVS on the return, amended return, or written statement.
5. For the avoidance of doubt, neither CVS nor the Settling States and Participating Subdivisions make any warranty or representation to any Settling State, Participating Subdivision, or Releasor as to the tax consequences of the payment of the Total Remediation Amount (or any portion thereof).
G. No Third-Party Beneficiaries. Except as expressly provided in this Agreement, no portion of this Agreement shall provide any rights to, or be enforceable by, any person or entity that is not a Settling State or Released Entity. No Settling State may assign or otherwise convey any right to enforce any provision of this Agreement.
H. Calculation. Any figure or percentage referred to in this Agreement shall be carried to seven decimal places.
I. Construction. None of the Parties and no Participating Subdivision shall be considered to be the drafter of this Agreement or of any of its provisions for the purpose of any statute, case law, or rule of interpretation or construction that would or might cause any provision to be construed against the drafter of this Agreement. The headings of the provisions of this Agreement are not binding and are for reference only and do not limit, expand, or otherwise affect the contents or meaning of this Agreement.
J. Cooperation. Each Party and each Participating Subdivision agrees to use reasonable efforts and to cooperate with the other Parties and Participating Subdivisions to cause this Agreement and Consent Judgments to become effective, to obtain all necessary approvals, consents and authorizations, if any, and to execute all documents and to take such other action as may be appropriate in connection herewith. Consistent with the foregoing, each Party and each Participating Subdivision agrees that it will not directly or indirectly assist or encourage any challenge to this Agreement or any Consent Judgment by any other person, and will support the integrity and enforcement of the terms of this Agreement and the Consent Judgments.
K. Entire Agreement. This Agreement, including its exhibits and any other attachments, embodies the entire agreement and understanding between and among the Parties and Participating Subdivisions relating to the subject matter hereof and supersedes (1) all prior agreements and understandings relating to such subject matter, whether written or oral and (2) all purportedly contemporaneous oral agreements and understandings relating to such subject matter.
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58 L. Execution. This Agreement may be executed in counterparts and by different signatories on separate counterparts, each of which shall be deemed an original, but all of which shall together be one and the same Agreement. One or more counterparts of this Agreement may be delivered by facsimile or electronic transmission with the intent that it or they shall constitute an original counterpart hereof. One or more counterparts of this Agreement may be signed by electronic signature.
M. Good Faith and Voluntary Entry. Each Party warrants and represents that it negotiated the terms of this Agreement in good faith. Each of the Parties and Participating Subdivisions warrants and represents that it freely and voluntarily entered into this Agreement without any degree of duress or compulsion. The Parties and Participating Subdivisions state that no promise of any kind or nature whatsoever (other than the written terms of this Agreement) was made to them to induce them to enter into this Agreement.
N. Legal Obligations. Nothing in this Agreement shall relieve CVS of the obligation to comply with all state and federal laws, regulations or rules, nor does any provision herein permit any acts or practices prohibited by such laws, regulations, or rules. Except with respect to the Injunctive Relief Terms, in the event of a conflict between this Agreement and any requirement or requirements of federal, state, or local laws, such that CVS cannot comply with this Agreement without violating such a requirement or requirements, CVS shall document such conflicts and notify the Attorney(s) General of the relevant Settling State(s) that it intends to comply with the requirement or requirements to the extent necessary to eliminate the conflict. With respect to the Injunctive Relief Terms, in the event of such a conflict, the procedures set forth in the Injunctive Relief Terms will be followed.
O. No Prevailing Party. The Parties and Participating Subdivisions each agree that they are not the prevailing party in this action, for purposes of any claim for fees, costs, or expenses as prevailing parties arising under common law or under the terms of any statute, because the Parties and Participating Subdivisions have reached a good faith settlement. The Parties and Participating Subdivisions each further waive any right to challenge or contest the validity of this Agreement on any ground, including, without limitation, that any term is unconstitutional or is preempted by, or in conflict with, any current or future law. Nothing in the previous sentence shall modify, or be construed to conflict with, Section XIII.N.
P. Non-Admissibility. Neither this Agreement nor any act performed or document executed pursuant to or in furtherance of this Agreement: (i) is or may be deemed to be or may be used as an admission or evidence relating to any matter of fact or law alleged in the Actions, the strength or weakness of any claim or defense or allegation made in those cases, or any wrongdoing, fault, or liability of any Released Entities; or (ii) is or may be deemed to be or may be used as an admission or evidence relating to any liability, fault or omission of Released Entities in any civil, criminal or administrative proceeding in any court, administrative agency or other tribunal. Neither this Agreement nor any act performed or document executed pursuant to or in furtherance of this Agreement shall be admissible in any proceeding for any purpose, except to enforce the terms of this Agreement, and except that Released Entities may file or use this Agreement in any action (1) involving a determination regarding insurance coverage; (2) involving a determination of the taxable income or tax liability of any Released Entities; (3) to support a defense or counterclaim WITH TECHNICAL CORRECTIONS 02.03.2023
59 based on principles of res judicata, collateral estoppel, release, good-faith settlement, judgment bar or reduction or on any other theory of claim preclusion or issue preclusion or similar defense or counterclaim; (4) to support a claim for contribution and/or indemnification; or (5) to support any other argument or defense by a Released Entities that the Remediation Payment provides a measure of compensation for Alleged Harms or otherwise satisfy the relief sought.
Q. Notices. All notices or other communications under this Agreement shall be in writing (including, but not limited to, electronic communications) and shall be given to the recipients indicated below:
For the Attorney(s) General:
Josh Stein, Attorney General
North Carolina Department of Justice
Attn: Daniel Mosteller, Deputy General Counsel
PO Box 629
Raleigh, NC 27602
[email protected]
Dave Yost, Attorney General
Ohio Attorney’s General Office
Attn: Jonathan Blanton, First Assistant Attorney General 30 East Broad Street
Columbus, OH 43215
[email protected]
Letitia James, Attorney General
New York State Office of the Attorney General
Attn: Jennifer Levy, First Deputy Attorney General
28 Liberty Street
New York, NY 10005
[email protected]
For the Plaintiffs’ Executive Committee:
Paul T. Farrell, Jr.
Farrell & Fuller, LLP
270 Munoz Rivera Ave., Suite 201
San Juan, Puerto Rico 00918
[email protected]
Jayne Conroy
Simmons Hanly Conroy LLC
112 Madison Avenue, 7th Floor
New York, NY 10016-7416
[email protected]
WITH TECHNICAL CORRECTIONS 02.03.2023
60 Joseph F. Rice
Motley Rice LLC
28 Bridgeside Blvd.
Mount Pleasant, SC 29464
[email protected]
For CVS:
Elizabeth Ferguson
Senior Vice President and Deputy General Counsel
CVS Health Corporation
One CVS Drive
Woonsocket, RI 02895
[email protected]
Notices to CVS’s attorneys shall be delivered to:
Eric Delinsky
Zuckerman Spaeder LLP
1800 M Street, NW, Suite 1000
Washington, DC 20036-5807
[email protected]
Perry Rowthorn
Jepsen Rowthorn LLP
PO Box 370496
West Hartford, CT 06137
[email protected]
Any Party or the Plaintiffs’ Executive Committee may change or add the contact information of the persons designated to receive notice on its behalf by notice given (effective upon the giving of such notice) as provided in this Section XIII.Q.
R. No Waiver. The waiver of any rights conferred hereunder shall be effective only if made by written instrument executed by the waiving Party or Parties. The waiver by any Party of any breach of this Agreement shall not be deemed to be or construed as a waiver of any other breach, whether prior, subsequent, or contemporaneous, nor shall such waiver be deemed to be or construed as a waiver by any other Party.
S. Severability. In the event any one or more immaterial provisions of this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement.
T. Preservation of Privilege. Nothing contained in this Agreement or any Consent Judgment, and no act required to be performed pursuant to this Agreement or any Consent WITH TECHNICAL CORRECTIONS 02.03.2023
61 Judgment, is intended to constitute, cause, or effect any waiver (in whole or in part) of any attorney-client privilege, work product protection, or common interest/joint defense privilege, and each Party and Participating Subdivision agrees that it shall not make or cause to be made in any forum any assertion to the contrary.
U. Successors.
1. This Agreement shall be binding upon, and inure to the benefit of, the Parties and their respective successors and assigns.
2. CVS shall not sell the majority of its voting stock or substantially all its assets without obtaining the acquiror’s agreement that it will constitute a successor with respect to CVS’s obligations under this Agreement.
3. CVS shall not in one (1) transaction, or a series of related transactions, sell, or transfer assets (other than sales or transfers of inventories, or sales or transfers to an entity owed directly or indirectly by CVS) having a fair market value equal to twenty-five percent (25%) or more of the consolidated assets of CVS where the sale or transfer transaction is announced after the Effective Date, is not for fair consideration, and would foreseeably and unreasonably jeopardize CVS’s ability to make the payments under this Agreement that are due on or before the third Payment Date following the close of a sale or transfer transaction. The above restriction shall not apply if CVS obtains the acquiror’s agreement that it will be either a guarantor of or successor to the percentage of CVS’s remaining payment obligations under this Agreement equal to the percentage of CVS’s consolidated assets being sold or transferred in such transaction. Percentages under this section shall be determined in accordance with the United States generally accepted accounting principles and as of the date of CVS’s most recent publicly filed consolidated balance sheet prior to the date of entry into the sale or transfer agreement at issue. This Section XIII.U.3 shall be enforceable solely by the Enforcement Committee, and any objection under this Section XIII.U.3 not raised within twenty (20) calendar days from the date that CVS transmits notice of the transaction to the Enforcement Committee is waived.
Any dispute under this Section XIII.U.3 shall be a National Dispute as described in Section VI.F.3 and must be raised exclusively with the National Arbitration Panel as described therein within twenty (20) calendar days of the announcement, and the sole remedy shall be an order enjoining the transaction.
V. Waiver. CVS, for good and valuable consideration the receipt of which is acknowledged, hereby (a) waives, foregoes and relinquishes all rights to utilize and/or seek relief under any of the following laws of the State of Texas for the restructuring of its debts or liabilities related to Released Claims, Claims that would have been Released Claims if they had been brought by a Releasor against a Released Entity before the Effective Date, or this Agreement: Tex. Bus.
Orgs. Code § 10.003 (Contents of Plan of Merger: More Than One Successor) or any other statute of Subchapter A of Chapter 10 of Tex. Bus. Orgs. Code to the extent such statute relates to multisuccessor mergers (and/or any other similar laws or statutes in any other state or territory); Tex.
Bus. Orgs. Code §§ 11.01–11.414 (Winding Up and Termination of Domestic Entity); or Tex. Bus. & Com. Code §§ 23.01–23.33 (Assignments for the Benefit of Creditors) (collectively, the “Texas WITH TECHNICAL CORRECTIONS 02.03.2023
62 Statutes”), and (b) agrees, warrants and represents that it will not file, request or petition for relief under the Texas Statutes related to its debts or liabilities related to Released Claims, Claims that would have been Released Claims if they had been brought by a Releasor against a Released Entity before the Effective Date, or this Agreement, in each case until such time as all of CVS’s payment obligations incurred hereunder are satisfied in full. The foregoing waiver and relinquishment includes, without limitation, until such time as all of CVS’s payment obligations incurred hereunder are satisfied in full, CVS’s rights to execute a divisional merger or equivalent transaction or restructuring related to its debts or liabilities related to Released Claims, Claims that would have been Released Claims if they had been brought by a Releasor against a Released Entity before the Effective Date, or this Agreement that in each case has the intent or foreseeable effect of (i) separating material assets from material liabilities and (ii) assigning or allocating all or a substantial portion of those liabilities to any subsidiary or affiliate that files for relief under chapter 11 of the Bankruptcy Code, or pursuant to which such subsidiary or affiliate that files for relief under chapter 11 of the Bankruptcy Code would be assuming or retaining all or a substantial portion of those liabilities.
W. Modification, Amendment, Alteration. In the event the Plaintiffs’ Executive Committee, the Executive Committee of the State Attorneys General, or CVS concludes prior to January 18, 2023 that technical corrections are required to this Agreement, the Plaintiffs’ Executive Committee, the Executive Committee of the State Attorneys General, and CVS shall meet and confer and make such amendments as they agree are appropriate. Except as otherwise provided in this Agreement, after the Reference Date, any modification, amendment, or alteration of this Agreement by the Parties shall be binding only if evidenced in writing signed by CVS, along with the signatures of at least two-thirds of the Settling States along with a representation from each such Settling State that either: (1) the Advisory Committee or similar entity established or recognized by that Settling State (either pursuant to Section V.E.2.d, by a State-Subdivision Agreement, or by statute) voted in favor of the modification, amendment or alteration of this Agreement including at least one member appointed by the Participating Subdivisions listed on Exhibit G; or (2) in States without any Advisory Committee, that 50.1% (by population) of the Participating Subdivisions listed on Exhibit G expressed approval of the modification, amendment, or alteration of this Agreement in a writing.
X. Termination.
1. Unless otherwise agreed to by CVS and the Settling State in question, this Agreement or the Consent Judgment as to that Settling State and all of its terms (except Section XIII.P and any other non-admissibility provisions, which shall continue in full force and effect) shall be canceled and terminated with respect to the Settling State, and the Agreement and all orders issued by the courts in the Settling State pursuant to the Agreement shall become null and void and of no effect, only if one or more of the following conditions applies:
a. a Consent Judgment approving this Agreement without
modification of any of the Agreement’s terms has not been entered as to the Settling State by a court of competent jurisdiction on or before one hundred eighty (180) days after the Effective Date; or
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63 b. this Agreement has been disapproved by a court of competent jurisdiction to which it was presented for approval and/or entry (or, in the event of an appeal from or review of a decision of such a court to approve this Agreement and the Consent Judgment, by the court hearing such appeal or conducting such review), and the time to appeal from such disapproval has expired, or, in the event of an appeal from such disapproval, the appeal has been dismissed or the disapproval has been affirmed by the court of last resort to which such appeal has been taken and such dismissal or disapproval has become no longer subject to further appeal (including, without limitation, review by the United States Supreme Court).
2. If this Agreement is terminated with respect to a Settling State for whatever reason pursuant to Section XIII.X.1, then:
a. an applicable statute of limitation or any similar time requirement (excluding any statute of repose) shall be tolled from the date the Settling State signed this Agreement until the later of the time permitted by applicable law or for one year from the date of such termination, with the effect that CVS and the Settling State in question shall be in the same position with respect to the statute of limitation as they were at the time the Settling State filed its action; and b. CVS and the Settling State in question shall jointly move the relevant court of competent jurisdiction for an order reinstating the actions and claims dismissed pursuant to the terms of this Agreement governing dismissal, with the effect that CVS and the Settling State in question shall be in the same position with respect to those actions and claims as they were at the time the action or claim was stayed or dismissed.
3. Unless CVS and the Enforcement Committee agree otherwise, this Agreement, with the exception of the Injunctive Relief Terms that have their own provisions on duration, shall terminate as to all Parties after the Payment Date for Payment Year 10, provided that CVS has performed its payment obligations under the Agreement as of that date. Notwithstanding any other provision in this Section XIII.X.3 or in this Agreement, all releases under this Agreement will remain effective in perpetuity.
Y. Governing Law. Except (1) as otherwise provided in this Agreement or (2) as necessary, in the sole judgment of the National Arbitration Panel, to promote uniformity of interpretation for matters within the scope of the National Arbitration Panel’s authority, this Agreement shall be governed by and interpreted in accordance with the respective laws of each Settling State, without regard to the conflict of law rules of such Settling State, that is seeking to enforce the Agreement against CVS or against which CVS is seeking enforcement.
Notwithstanding any other provision in this subsection on governing law, any disputes relating to the Settlement Fund Escrow shall be governed by and interpreted in accordance with the law of the state where the escrow agent has its primary place of business.
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EXHIBIT A
Alleged Harms
The following expert reports that were served in connection with the case captioned In re:
National Prescription Opiate Litigation, No. 1:17-md-2804 (N.D. Ohio), provide non-exclusive examples of Alleged Harms:
1. Expert reports of G. Caleb Alexander, M.D., M.S., dated March 24, 2019, April 16, 2021, and August 22, 2022;
2. Expert reports of David Cutler dated March 25, 2019, April 16, 2021, April 21, 2021, May 10, 2021, and August 22, 2022;
3. Expert report of David Herzberg, Ph.D., dated April 16, 2021;
4. Expert reports of Katherine M. Keyes, Ph.D., dated March 25, 2019, April 16, 2021, June 2, 2021, and August 22, 2022;
5. Expert reports of Dr. Anna Lembke, M.D., dated March 25, 2019, April 16, 2021, and August 22, 2022;
6. Expert report of Nancy Young, Ph.D, M.S.W., dated March 25, 2019 and April 16, 2021;
7. Expert report of Harvey Rosen, dated April 16, 2021; and
8. Expert report of Professor Thomas McGuire dated March 25, 2019.
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EXHIBIT B
Enforcement Committee Organization Bylaws
ARTICLE I
These bylaws constitute the code of rules adopted by the Settling States and Participating Subdivisions for the creation of an Enforcement Committee (the “Committee”) to exist and operate during the term of the Agreement in connection with CVS and shall control the regulation and management of the Committee’s affairs.
ARTICLE II
Purpose
The Committee is organized for the sole purpose of evaluating and taking such action as deemed reasonable, necessary, and appropriate by the members of the Committee on the matters delegated to the Committee under that certain Settlement Agreement between the Settling States and CVS dated December 9, 2022.
ARTICLE III
Members of the Committee
(1) Number of Members
The Committee will consist of sixteen (16) members (the “Members”). Upon majority resolution of the Committee, the number of Members may be increased or decreased from time to time, but in no event shall a decrease have the effect of decreasing the total number of Members to less than seven Members.
(2) Initial Members
The Committee initially will consist of ten (10) Settling State Members and six (6) Participating Subdivision Members; three (3) of the Participating Subdivisions shall be counties and three (3) shall be municipalities. The initial Settling State Members are representatives from: Connecticut, Delaware, Illinois, Indiana, Louisiana, New York, North Carolina, Ohio, Tennessee, and Texas. The initial Participating Subdivision Members are: [●]. Until fifteen (15) months from the Effective Date contained in the Settlement Agreement, the Participating Subdivisions may designate their outside counsel to serve as their representative. After fifteen (15) months from the Effective Date, an employee or official of the Participating Subdivision must be the designated as the representative of the Participating Subdivision.
(3) Term of Members
The term of office for Members of the Committee will be until the end of the term of the Settlement Agreement unless and until a Member withdraws or resigns from the Committee.
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(4) Resignation
Any Member may resign at any time by delivering written notice to the Chairperson of the Committee. Such resignation shall take effect upon receipt or, if later, at the time specified in the notice.
(5) Removal
(a) Any Member may be removed without cause, at any time, by a majority of the entire Committee, at a Regular or Special Meeting called for that purpose. Any Member under consideration of removal must first be notified about the consideration by written notice at least five days prior to the meeting at which the vote takes place. (b) In the event that any Member is not a Settling State or a Participating Subdivision or the Member subsequently becomes a Later Litigating Subdivision, the Member shall be removed immediately without notice or vote of the Committee. (6) Vacancies
In the event of a vacancy, the Members of the same type (Settling State or Participating Subdivision) shall select another Settling State or Participating Subdivision to fill that Member’s position.
(7) Compensation
Members shall not receive any salaries or other compensation for their services, but, by resolution of the Committee, may be reimbursed for any actual expenses incurred in the performance of their duties for the Committee, as long as a majority of disinterested Members approve the reimbursement. Any reimbursement shall be sought from the Settlement Fund Administrator.
ARTICLE IV
Conflicts of Interest and Code of Ethics
If a Member, agent, or employee of the Committee has a conflict of interest, he or she may not participate in a vote, discussion, or decision about the matter. Each Member shall follow any applicable state or local law with respect to conflicts, gifts, and ethics.
ARTICLE V
Committee Meetings
(1) Place of Meetings
Meetings of the Committee will be held at any place that the Chairperson may designate, including by telephonic or electronic means.
(2) Regular Meetings
Regular meetings of the Committee shall be held as deemed necessary by the Chairperson or any three members.
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(3) Notice of Meetings
Written notice of the date, time, place and subject of each meeting must be provided to the Members at least 72 hours before the scheduled time of the meeting, except when there is an emergency or urgent public necessity.
(4) Quorum
A majority of the incumbent Members (not counting vacancies) shall constitute a quorum for the purposes of convening a meeting or conducting business. (5) Voting and Proxy
When it is necessary to vote on any matter before the Committee, Members may vote by electronic means as provided in these Bylaws. Proxy voting is permitted. In order for a matter to pass, the matter must have a majority vote of Members present and must have at least one vote from a Settling State Member and a Participating Subdivision Member. In the event that there is a Quorum, but no Settling State or Participating Subdivision Member is present, then a matter may pass with a simple majority vote. (6) Minutes
The Committee shall prepare and keep minutes. The minutes must state the subject of each deliberation and indicate each vote, order, decision, or other action taken.
ARTICLE VI
Officers
(1) Roster of Officers
The Committee shall have a Chairperson, a Vice Chairperson, and a Secretary. The Committee may have at its discretion, such other officers as may be appointed by the Members of the Committee. One person may hold two or more offices, except those serving as Chairperson.
(2) Election and Removal of Officers
All officers shall serve two-year terms. The election shall be conducted at the first meeting of the fiscal year. Officers shall remain in office until their successors have been selected.
Officers may serve consecutive terms without limit. The election of officers shall be by majority vote of the Members of the Committee attending the meeting. (3) Vacancies
If a vacancy occurs during the term of office for any elected officer, the Members of the Committee shall elect a new officer to fill the remainder of the term as soon as practical, by majority vote of Members present.
(4) Chairperson
The Chairperson will supervise and control the affairs of the Committee and shall exercise such supervisory powers as may be given him/her by the Members of the Committee. The Chairperson will perform all duties incident to such office and such other duties as may be provided in these bylaws or as may be prescribed from time to time by the Committee. The Chairperson shall preside at all meetings and shall exercise parliamentary control in accordance with Robert’s Rules of Order.
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(5) Vice Chairperson
The Vice Chairperson shall act in place of the Chairperson in the event of the Chairperson’s absence, inability, or refusal to act, and shall exercise and discharge such other duties as may be required by the Committee. The Vice Chairperson shall serve as the parliamentarian and interpret any ambiguities of the bylaws. (6) Secretary
The Secretary will keep and maintain all records related to the Committee and take minutes of all meetings.
(7) Records
All elected officers and committee chairpersons shall relinquish their records to the Chairperson immediately upon the completion of their term of office or completion of a project.
(8) Resignation
An officer may resign the office while not resigning membership from the Committee, by submitting a letter to the Chairperson. Vacancies occurring in any office shall be appointed for the remainder of the term.
ARTICLE VII
Duties
(1) Prior to the Effective Date
The Committee shall be responsible for any additional negotiations with CVS, including, but not limited to, negotiating extensions of any periods created by the Settlement Agreement, except that any additional negotiations related to the Injunctive Relief Terms (Exhibit [●]) shall be handled by the States Injunctive Relief Committee in accordance with the terms of Exhibit [●].
(2) After the Effective Date
The Committee shall establish procedures for the receipt of notices that a dispute exists concerning the Agreement and review of such disputes, pursuant to Section [●] of the Agreement. Members may engage with CVS, Settling States, and Participating Subdivisions attempting to resolve any dispute without further action by the Committee.
The Committee may request additional information from CVS, Settling States, and Participating Subdivisions to the extent the Committee believes such information is necessary to understand, resolve, or provide advice related to a dispute. The Committee shall endeavor to provide advice relative to the dispute no later than 60 days after receipt of notice.
ARTICLE VIII
Rules of Procedure
The proceedings and business of the Committee shall be governed by Robert’s Rules of Order unless otherwise waived by the Committee.
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ARTICLE IX
Operations
(1) Records
The Committee will keep correct and complete records and will also keep minutes of the proceedings of the Committee meetings and Committees. The Committee will keep such records at its principal place of business at a place designated by the Chairperson.
All elected officers and committee chairpersons shall relinquish their records to the Chairperson, immediately upon the completion of their term of office. (2) Inspection of Books and Records
The minutes of a meeting are public records and shall be available for public inspection and copying on request to the Committee’s Chairperson or the Chairperson’s designee. (3) Amendments
The bylaws may be amended at any time by a vote of a majority of Members present and must have at least one vote from a Settling State Member and a Participating Subdivision Member. In the event that there is a Quorum, but no Settling State or Participating Subdivision Member is present, then a matter may pass with a simple majority vote.
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EXHIBIT C
Litigating Subdivisions
1. Alabaster City, Alabama
2. Albertville City, Alabama
3. Allred, Hal (Sheriff, Lamar County),
Alabama
4. Arab City, Alabama
5. Ashville City, Alabama
6. Athens City, Alabama
7. Atalla City, Alabama
8. Auburn City, Alabama
9. Baldwin County, Alabama
10. Bay Minette City, Alabama
11. Berry Town, Alabama
12. Bessemer City, Alabama
13. Bibb County, Alabama
14. Birmingham City, Alabama
15. Boaz City, Alabama
16. Brewton City, Alabama
17. Bullock County, Alabama
18. Butler Town, Alabama
19. Calera City, Alabama
20. Calhoun County, Alabama
21. Camp Hill Town, Alabama
22. Cedar Bluff Town, Alabama
23. Centre City, Alabama
24. Centreville City, Alabama
25. Cherokee County, Alabama
26. Cherokee Town, Alabama
27. Childersburg City, Alabama
28. Chilton County, Alabama
29. Clanton City, Alabama
30. Coffee County, Alabama
31. Colbert County, Alabama
32. Columbiana City, Alabama
33. Conecuh County, Alabama
34. Cullman City, Alabama
35. Cullman County, Alabama
36. Dadeville City, Alabama
37. Dallas County, Alabama
38. Daphne City, Alabama
39. Decatur City, Alabama
40. Demopolis City, Alabama
41. Dora City, Alabama
42. Double Springs Town, Alabama
43. Douglas Town, Alabama
44. East Brewton City, Alabama
45. Elmore County, Alabama
46. Enterprise City, Alabama
47. Fairhope City, Alabama
48. Fayette City, Alabama
49. Fayette County, Alabama
50. Florence City, Alabama
51. Foley City, Alabama
52. Fort Deposit Town, Alabama
53. Franklin County, Alabama
54. Fultondale City, Alabama
55. Gadsden City, Alabama
56. Gilbertown Town, Alabama
57. Grant Town, Alabama
58. Graysville City, Alabama
59. Gulf Shores City, Alabama
60. Guntersville City, Alabama
61. Haleyville City, Alabama
62. Hartselle City, Alabama
63. Helena City, Alabama
64. Homewood City, Alabama
65. Hoover City, Alabama
66. Hueytown City, Alabama
67. Huntsville City, Alabama
68. Irondale City, Alabama
69. Jackson County, Alabama
70. Jacksonville City, Alabama
71. Jasper City, Alabama
72. Jefferson County, Alabama
73. Lamar County, Alabama
74. Lauderdale County, Alabama
75. Lawrence County, Alabama
76. Leesburg City, Alabama
77. Leighton Town, Alabama
78. Lincoln City, Alabama
79. Loxley Town, Alabama
80. Madison County, Alabama
81. Marengo County, Alabama
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82. Marion County, Alabama
83. Marshall County, Alabama
84. Millbrook City, Alabama
85. Mobile City, Alabama
86. Mobile County, Alabama
87. Moody City, Alabama
88. Morgan County, Alabama
89. Moulton City, Alabama
90. Mountain Brook City, Alabama
91. Munford Town, Alabama
92. Northport City, Alabama
93. Oakman Town, Alabama
94. Opelika City, Alabama
95. Opp City, Alabama
96. Orange Beach City, Alabama
97. Ozark City, Alabama
98. Pelham City, Alabama
99. Pettway, Mark (Sheriff Jefferson
County), Alabama
100. Phenix City, Alabama
101. Pickens County, Alabama
102. Piedmont City, Alabama
103. Pike County, Alabama
104. Pleasant Grove City, Alabama
105. Prattville City, Alabama
106. Prichard City, Alabama
107. Ragland City, Alabama
108. Rainbow City, Alabama
109. Randolph County, Alabama
110. Red Bay City, Alabama
111. Roanoke City, Alabama
112. Russellville City, Alabama
113. Saraland City, Alabama
114. Semmes City, Alabama
115. Selma City, Alabama
116. Sheffield City, Alabama
117. Slocumb City, Alabama
118. Spanish Fort City, Alabama
119. Springville City, Alabama
120. Sumiton City, Alabama
121. Summerdale Town, Alabama
122. Sylacauga City, Alabama
123. Talladega City, Alabama
124. Talladega County, Alabama
125. Thomasville City, Alabama
126. Troy City, Alabama
127. Trussville City, Alabama
128. Tuscaloosa City, Alabama
129. Tuscaloosa County, Alabama
130. Tuscumbia City (AL)
131. Union Springs City, Alabama
132. Vernon City, Alabama
133. Vestavia Hills City, Alabama
134. Walker County, Alabama
135. West Blocton Town, Alabama
136. Wetumpkia City, Alabama
137. Wilcox County, Alabama
138. Winston County, Alabama
139. Yerby, Byron (Sheriff Fayette
County), Alabama
140. Arizona Municipal Risk Retention
Pool, Arizona
141. Cochise County, Arizona
142. Kingman City, Arizona
143. Maricopa County, Arizona
144. Mohave County, Arizona
145. Navajo County, Arizona
146. Phoenix City, Arizona
147. Yuma County, Arizona
148. Alameda County, California
149. Amador County, California
150. Anaheim City, California
151. Butte County, California
152. Calaveras County, California
153. Chico City, California
154. Chula Vista City, California
155. Clearlake City, California
156. Costa Mesa City, California
157. Del Norte County, California
158. Dublin City, California
159. El Dorado County, California
160. Encinitas City, California
161. Eureka City, California
162. Fresno County, California
163. Fullerton City, California
164. Humboldt County, California
165. Huntington Beach City, California
166. Imperial County, California
167. Inyo County, California
168. La Habra City, California
169. La Mesa City, California
170. Laguna Beach City, California
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171. Lakeport City, California
172. Lassen County, California
173. Los Angeles City, California
174. Los Angeles County, California
175. Madera County, California
176. Marin County, California
177. Mariposa County, California
178. Mendocino County, California
179. Merced County, California
180. Modoc County, California
181. Mono County, California
182. Monterey County, California
183. Murrieta City, California
184. Napa County, California
185. Nevada County, California
186. Oxnard City, California
187. Placentia City, California
188. Placer County, California
189. Plumas County, California
190. Riverside County, California
191. Sacramento City, California
192. Sacramento County, California
193. San Bernardino County, California
194. San Clemente City, California
195. San Diego County, California
196. San Jose City, California
197. San Leandro Unified School District,
California
198. San Luis Obispo County, California
199. Santa Ana City, California
200. Santa Clara County, California
201. Santa Cruz County, California
202. Shasta County, California
203. Sonoma County, California
204. Sutter County, California
205. Tehama County, California
206. Trinity County, California
207. Tulare County, California
208. Tuolumne County, California
209. Ventura County, California
210. Westminster City, California
211. Yolo County, California
212. Yuba County, California
213. Adams County, Colorado
214. Arapahoe County, Colorado
215. Aurora City, Colorado
216. Black Hawk City, Colorado
217. Boulder County, Colorado
218. Brighton City, Colorado
219. Broomfield City and County,
Colorado
220. Commerce City, Colorado
221. Denver City and County, Colorado
222. Federal Heights City, Colorado
223. Fremont County, Colorado
224. Greeley City, Colorado
225. Hudson Town, Colorado
226. Jefferson County, Colorado
227. Larimer County, Colorado
228. Mesa County, Colorado
229. Northglenn City, Colorado
230. Pueblo County, Colorado
231. Sheridan City, Colorado
232. Teller County, Colorado
233. Thornton City, Colorado
234. Westminster City, Colorado
235. Beacon Falls Town, Connecticut
236. Berlin Town, Connecticut
237. Bethlehem Town, Connecticut
238. Bridgeport City, Connecticut
239. Bristol City, Connecticut
240. Coventry Town, Connecticut
241. East Hartford Town, Connecticut
242. Enfield Town, Connecticut
243. Fairfield Town, Connecticut
244. Middlebury Town, Connecticut
245. Middletown City, Connecticut
246. Milford City, Connecticut
247. Monroe Town, Connecticut
248. Naugatuck Town, Connecticut
249. New Milford Town, Connecticut
250. Newtown Town, Connecticut
251. North Haven Town, Connecticut
252. Norwich City, Connecticut
253. Oxford Town, Connecticut
254. Prospect Town, Connecticut
255. Roxbury Town, Connecticut
256. Seymour Town, Connecticut
257. Shelton City, Connecticut
258. Southbury Town, Connecticut
259. Southington Town, Connecticut
260. Stratford Town, Connecticut
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261. Thomaston Town, Connecticut
262. Tolland Town, Connecticut
263. Torrington City, Connecticut
264. Waterbury City, Connecticut
265. West Haven City, Connecticut
266. Wethersfield Town, Connecticut
267. Windham Town, Connecticut
268. Wolcott Town, Connecticut
269. Woodbury Town, Connecticut
270. Dover City, Delaware
271. Kent County, Delaware
272. Seaford City, Delaware
273. Sussex County, Delaware
274. Albany City, Georgia
275. Appling County, Georgia
276. Arlington City, Georgia
277. Athens-Clarke County, Georgia
278. Atlanta City, Georgia
279. Augusta-Richmond County
consolidated government, Georgia
280. Bainbridge City, Georgia
281. Banks County, Georgia
282. Bartow County, Georgia
283. Ben Hill County, Georgia
284. Berry, Scott (Sheriff Oconee
County), Georgia
285. Blakely City, Georgia
286. Bohannon, Preston (Sheriff Jeff
Davis County), Georgia
287. Brantley County, Georgia
288. Bulloch County, Georgia
289. Burke County, Georgia
290. Butts County, Georgia
291. Camden County, Georgia
292. Candler County, Georgia
293. Carroll County, Georgia
294. Carter, John (Sheriff Wayne
County), Georgia
295. Cartersville City, Georgia
296. Catoosa County, Georgia
297. Charlton County, Georgia
298. Chattooga County, Georgia
299. Cherokee County, Georgia
300. Clay County, Georgia
301. Clayton County, Georgia
302. Clinch County, Georgia
303. Cobb County, Georgia
304. Columbia County, Georgia
305. Columbus City, Georgia
306. Cook County, Georgia
307. Crisp County, Georgia
308. Dade County, Georgia
309. Damascus City, Georgia
310. Davis, David (Sheriff Bibb County),
Georgia
311. Dawson County, Georgia
312. Decatur County, Georgia
313. Deese, Terry (Sheriff Peach County),
Georgia
314. Dekalb County, Georgia
315. Dooly County, Georgia
316. Dougherty County, Georgia
317. Early County, Georgia
318. Effingham County, Georgia
319. Elbert County, Georgia
320. Emanuel County, Georgia
321. Evans County, Georgia
322. Fayette County, Georgia
323. Fitzgerald City, Georgia
324. Flood County, Georgia
325. Forsyth County, Georgia
326. Fulton County, Georgia
327. Gainesville City, Georgia
328. Glascock County, Georgia
329. Glynn County, Georgia
330. Greene County, Georgia
331. Gwinnett County, Georgia
332. Habersham County, Georgia
333. Hall County, Georgia
334. Hancock County, Georgia
335. Hancock, H.W. (Sheriff Crisp
County), Georgia
336. Henry County, Georgia
337. Houston County, Georgia
338. Irwin County, Georgia
339. Jackson County, Georgia
340. Jasper County, Georgia
341. Jeff Davis County, Georgia
342. Jefferson County, Georgia
343. Johnson County, Georgia
344. Jones County, Georgia
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345. Jump, E. Neal (Sheriff Glynn
County), Georgia
346. Langford, Gary (Sheriff Murray
County), Georgia
347. Laurens County, Georgia
348. Lee County, Georgia
349. Liberty County, Georgia
350. Lincoln County, Georgia
351. Long County, Georgia
352. Lowndes County, Georgia
353. Lumpkin County, Georgia
354. Macon County, Georgia
355. Macon-Bibb County, Georgia
356. Madison County, Georgia
357. Massee, William (Sheriff Baldwin
County), Georgia
358. McDuffie County, Georgia
359. McIntosh County, Georgia
360. Melton, Mark (Sheriff Appling
County), Georgia
361. Milledgeville City, Georgia
362. Monroe County, Georgia
363. Montgomery County, Georgia
364. Newton County, Georgia
365. Oconee County, Georgia
366. Oglethorpe County, Georgia
367. Peach County, Georgia
368. Pike County, Georgia
369. Polk County, Georgia
370. Pulaski County, Georgia
371. Rabun County, Georgia
372. Randolph County, Georgia
373. Rockdale County, Georgia
374. Rome City, Georgia
375. Sandy Springs City, Georgia
376. Savannah City, Georgia
377. Scarbrough, Gene (Sheriff Tift
County), Georgia
378. Screven County, Georgia
379. Seminole County, Georgia
380. Spalding County, Georgia
381. Springfield City, Georgia
382. Stephens County, Georgia
383. Sumter County, Georgia
384. Taliaferro County, Georgia
385. Talton, Cullen (Sheriff Houston
County), Georgia
386. Tattnall County, Georgia
387. Tifton City, Georgia
388. Toombs County, Georgia
389. Towns County, Georgia
390. Troup County, Georgia
391. Twiggs County, Georgia
392. Union County, Georgia
393. Walton County, Georgia
394. Warren County, Georgia
395. Washington County, Georgia
396. Wayne County, Georgia
397. Whitfield County, Georgia
398. Wilkes County, Georgia
399. Woodbury City, Georgia
400. Wooten, Doyle (Sheriff Coffee
County), Georgia
401. Worth County, Georgia
402. Kaua’i County, Hawai’i
403. Ada County, Idaho
404. Adams County, Idaho
405. Bannock County, Idaho
406. Bingham County, Idaho
407. Blaine County, Idaho
408. Boise City, Idaho
409. Boise County, Idaho
410. Bonneville County, Idaho
411. Camas County, Idaho
412. Canyon County, Idaho
413. Caribou County, Idaho
414. Cassia County, Idaho
415. Chubbuck City, Idaho
416. Elmore County, Idaho
417. Gooding County, Idaho
418. Latah County, Idaho
419. Minidoka County, Idaho
420. Owyhee County, Idaho
421. Payette County, Idaho
422. Pocatello City, Idaho
423. Preston City, Idaho
424. Twin Falls City, Idaho
425. Twin Falls County, Idaho
426. Bond County, Illinois
427. Boone County, Illinois
428. Bureau County, Illinois
WITH TECHNICAL CORRECTIONS 02.03.2023
C-6
429. Calhoun County, Illinois
430. Champaign County, Illinois
431. Chicago City, Illinois
432. Chicago Public School District 299,
Illinois
433. Christian County, Illinois
434. Coles County, Illinois
435. Cook County, Illinois
436. Dekalb County, Illinois
437. Dupage County, Illinois
438. East Aurora Public Schools, District
131, Illinois
439. Franklin County, Illinois
440. Harrisburg City, Illinois
441. Henry County, Illinois
442. Herrin City, Illinois
443. Jasper County, Illinois
444. Jefferson County, Illinois
445. Johnson County, Illinois
446. Joliet Public Schools, District 204,
Illinois
447. Kane County, Illinois
448. Kankakee County, Illinois
449. Kendall County, Illinois
450. Logan County, Illinois
451. Lawrence County, Illinois
452. Macon County, Illinois
453. Macoupin County, Illinois
454. Marion City, Illinois
455. Marion County, Illinois
456. McHenry County, Illinois
457. Piatt County, Illinois
458. Princeton City, Illinois
459. Putnam County, Illinois
460. Rock Island County, Illinois
461. Rockford City, Illinois
462. Saline County, Illinois
463. Sangamon County, Illinois
464. Schuyler County, Illinois
465. Shelby County, Illinois
466. Stephenson County, Illinois
467. Thornton High Schools, District 205,
Illinois
468. Thornton Fractional High Schools,
District 215, Illinois
469. Union County, Illinois
470. Wabash County, Illinois
471. West Frankfort City, Illinois
472. White County, Illinois
473. Will County, Illinois
474. Winnebago County, Illinois
475. Alexandria City, Indiana
476. Allen County, Indiana
477. Atlanta Town, Indiana
478. Beech Grove City, Indiana
479. Benton County, Indiana
480. Blackford County, Indiana
481. Bloomington City, Indiana
482. Brownstown Town, Indiana
483. Chandler Town, Indiana
484. Connersville City, Indiana
485. Danville Town, Indiana
486. Delaware County, Indiana
487. Evansville City, Indiana
488. Fishers City, Indiana
489. Fort Wayne City, Indiana
490. Franklin City, Indiana
491. Franklin County, Indiana
492. Gary City, Indiana
493. Greenwood City, Indiana
494. Hammond City, Indiana
495. Harrison County, Indiana
496. Hartford City, Indiana
497. Howard County, Indiana
498. Huntington City, Indiana
499. Indianapolis City, Indiana
500. Jackson County, Indiana
501. Jasper City, Indiana
502. Jay County, Indiana
503. Jeffersonville City, Indiana
504. Jennings County, Indiana
505. Lafayette City, Indiana
506. Lake County, Indiana
507. LaPorte County, Indiana
508. Lawrence City, Indiana
509. Lawrence County, Indiana
510. Logansport City, Indiana
511. Marion County, Indiana
512. Marshall County, Indiana
513. Martinsville City, Indiana
514. Monroe County, Indiana
515. Montpelier City, Indiana
WITH TECHNICAL CORRECTIONS 02.03.2023
C-7
516. Mooresville Town, Indiana
517. Morgan County, Indiana
518. Muncie City, Indiana
519. New Castle City, Indiana
520. Noblesville City, Indiana
521. Pendleton Town, Indiana
522. Peru City, Indiana
523. Plainfield Town, Indiana
524. Porter County, Indiana
525. Portland City, Indiana
526. Pulaski County, Indiana
527. Richmond City, Indiana
528. Ripley County, Indiana
529. Scott County, Indiana
530. Seymour City, Indiana
531. Sheridan Town, Indiana
532. South Bend City, Indiana
533. St. Joseph County, Indiana
534. Starke County, Indiana
535. Terre Haute City, Indiana
536. Tippecanoe County, Indiana
537. Upland Town, Indiana
538. Vanderburgh County, Indiana
539. Vigo County, Indiana
540. West Lafayette City, Indiana
541. Westfield City, Indiana
542. Zionsville Town, Indiana
543. Adair County, Iowa
544. Adams County, Iowa
545. Audubon County, Iowa
546. Allamakee County, Iowa
547. Appanoose County, Iowa
548. Benton County, Iowa
549. Black Hawk County, Iowa
550. Bremer County, Iowa
551. Buchanan County, Iowa
552. Buena Vista County, Iowa
553. Calhoun County, Iowa
554. Carroll County, Iowa
555. Cedar County, Iowa
556. Cerro Gordo County, Iowa
557. Cherokee County, Iowa
558. Chickasaw County, Iowa
559. Clay County, Iowa
560. Clayton County, Iowa
561. Clinton County, Iowa
562. Dallas County, Iowa
563. Delaware County, Iowa
564. Des Moines County, Iowa
565. Emmet County, Iowa
566. Fayette County, Iowa
567. Fremont County, Iowa
568. Hamilton County, Iowa
569. Hancock County, Iowa
570. Hardin County, Iowa
571. Harrison County, Iowa
572. Henry County, Iowa
573. Howard County, Iowa
574. Humboldt County, Iowa
575. Ida County, Iowa
576. Jasper County, Iowa
577. Johnson County, Iowa
578. Jones County, Iowa
579. Keokuk County, Iowa
580. Lee County, Iowa
581. Lyon County, Iowa
582. Madison County, Iowa
583. Mahaska County, Iowa
584. Marion County, Iowa
585. Mills County, Iowa
586. Mitchell County, Iowa
587. Monroe County, Iowa
588. Montgomery County, Iowa
589. Muscatine County, Iowa
590. O’Brien County, Iowa
591. Osceola County, Iowa
592. Plymouth County, Iowa
593. Pocahontas County, Iowa
594. Polk County, Iowa
595. Pottawattamie County, Iowa
596. Poweshiek County, Iowa
597. Sac County, Iowa
598. Scott County, Iowa
599. Shelby County, Iowa
600. Sioux County, Iowa
601. Tama County, Iowa
602. Taylor County, Iowa
603. Union County, Iowa
604. Webster County, Iowa
605. Winnebago County, Iowa
606. Winneshiek County, Iowa
607. Worth County, Iowa
WITH TECHNICAL CORRECTIONS 02.03.2023
C-8
608. Wright County, Iowa
609. Allen County, Kansas
610. Barber County, Kansas
611. Bourbon County, Kansas
612. Cowley County, Kansas
613. Dickinson County, Kansas
614. Elk County, Kansas
615. Elkhardt City, Kansas
616. Finney County, Kansas
617. Grant County, Kansas
618. Greenwood County, Kansas
619. Johnson County, Kansas
620. Kansas City, Kansas
621. Leavenworth County, Kansas
622. Manter City, Kansas
623. Meade County, Kansas
624. Morton County, Kansas
625. Overland Park City, Kansas
626. Reno County, Kansas
627. Sedgwick County, Kansas
628. Seward County, Kansas
629. Stanton County, Kansas
630. Ulysses City, Kansas
631. Wabaunsee County, Kansas
632. Wichita City, Kansas
633. Wyandotte County, Kansas
634. Adair County, Kentucky
635. Bellefont City, Kentucky
636. Benham City, Kentucky
637. Boone County, Kentucky
638. Bourbon County, Kentucky
639. Boyd County, Kentucky
640. Boyle County, Kentucky
641. Breckinridge County, Kentucky
642. Breathitt County Public Schools,
Kentucky
643. Buckhorn City, Kentucky
644. Bullitt County Public Schools,
Kentucky
645. Clark County, Kentucky
646. Covington City, Kentucky
647. Edmonson County Fiscal Court,
Kentucky
648. Estill County, Kentucky
649. Estill County Public Schools,
Kentucky
650. Fayette County Public Schools,
Kentucky
651. Floyd County, Kentucky
652. Franklin County, Kentucky
653. Green County, Kentucky
654. Greenup City, Kentucky
655. Greenup County, Kentucky
656. Hardin County, Kentucky
657. Harlan City, Kentucky
658. Harlan County, Kentucky
659. Harrison County Public Schools,
Kentucky
660. Hart County Public Schools,
Kentucky
661. Henderson City, Kentucky
662. Henderson County, Kentucky
663. Henry County, Kentucky
664. Hopkins County, Kentucky
665. Hyden City, Kentucky
666. Jefferson County Public Schools,
Kentucky
667. Jenkins City, Kentucky
668. Jessamine County, Kentucky
669. Johnson County Public Schools,
Kentucky
670. Kenton County, Kentucky
671. Knott County, Kentucky
672. Larue County Public Schools,
Kentucky
673. Lawrence County, Kentucky
674. Lawrence County Public Schools,
Kentucky
675. Lee County, Kentucky
676. Lexington-Fayette Urban County,
Kentucky
677. London City, Kentucky
678. Louisville-Jefferson County,
Kentucky
679. Loyall City, Kentucky
680. Lynch City, Kentucky
681. Madison County, Kentucky
682. Manchester City, Kentucky
683. Marshall County, Kentucky
684. Martin County Public Schools,
Kentucky
685. McCracken County, Kentucky
WITH TECHNICAL CORRECTIONS 02.03.2023
C-9
686. Meade County, Kentucky
687. Menifee County Public Schools,
Kentucky
688. Montgomery County, Kentucky
689. Morehead City, Kentucky
690. Ohio County, Kentucky
691. Oldham County, Kentucky
692. Owsley County, Kentucky
693. Owsley County Public Schools,
Kentucky
694. Paducah City, Kentucky
695. Pendleton County, Kentucky
696. Perry County, Kentucky
697. Pike County, Kentucky
698. Pineville City, Kentucky
699. Pippa Passes City, Kentucky
700. Pulaski County, Kentucky
701. Russell City, Kentucky
702. Scott County, Kentucky
703. Shelby County, Kentucky
704. South Shore City, Kentucky
705. Vanceburg City, Kentucky
706. Warren County, Kentucky
707. Whitesburg City, Kentucky
708. Woodford County, Kentucky
709. Wolfe County Public Schools,
Kentucky
710. Worthington City, Kentucky
711. Acadia-St. Landry Hospital Service
District d/b/a Acadia-St. Landry
Hospital, Louisiana
712. Ackal, Louis (Sheriff Iberia Parish),
Louisiana
713. Alexandria City, Louisiana
714. Anderson, Douglas (Sheriff
Avoyelles Parish), Louisiana
715. Anslum, Scott (Sheriff St. Mary
Parish), Louisiana
716. Ascension Parish, Louisiana
717. Ascension Parish School Board,
Louisiana
718. Assumption Parish Police Jury,
Louisiana
719. Avoyelles Parish Police Jury,
Louisiana
720. Baldwin Town, Louisiana
721. Bastrop City, Louisiana
722. Baton Rouge City, Louisiana
723. Beauregard Parish Police Jury,
Louisiana
724. Benton Fire District 4, Louisiana
725. Berwick Town, Louisiana
726. Bogalusa City, Louisiana
727. Bossier City, Louisiana
728. Bossier Parish, Louisiana
729. Caddo Fire District 1, Louisiana
730. Caddo Parish, Louisiana
731. Calcasieu Parish Policy Jury,
Louisiana
732. Caldwell Parish, Louisiana
733. Cameron Parish, Louisiana
734. Catahoula Parish Police Jury,
Louisiana
735. Champagne, Greg (Sheriff St.
Charles Parish), Louisiana
736. Claiborne Parish, Louisiana
737. Concordia Parish, Louisiana
738. Craft, John (Sheriff Vernon Parish),
Louisiana
739. Delhi Town, Louisiana
740. Desoto Fire District 8, Louisiana
741. Donaldsonville City, Louisiana
742. East Carroll Parish Police Jury,
Louisiana
743. Edwards, Toney (Sheriff Catahoula
Parish), Louisiana
744. Eunice City, Louisiana
745. Evangeline Parish Police Jury,
Louisiana
746. Falcon, Leland (Sheriff Assumption
Parish), Louisiana
747. Ferriday Town, Louisiana
748. Franklin City, Louisiana
749. Franklin Parish, Louisiana
750. Garber, Mark (Sheriff Lafayette
Parish), Louisiana
751. Gautreaux, Sid (Sheriff East Baton
Rouge Parish), Louisiana
752. Gilley, Gary (Sheriff Richland
Parish), Louisiana
753. Gramercy Town, Louisiana
754. Grant Parish, Louisiana
WITH TECHNICAL CORRECTIONS 02.03.2023
C-10
755. Guidroz, Bobby (Sheriff St. Landry
Parish), Louisiana
756. Gusman, Marlin (Sheriff Orleans
Parish), Louisiana
757. Hospital Service District No. 1 of the
Parish of Avoyelles, State of
Louisiana d/b/a Bunkie General
Hospital, Louisiana
758. Hospital Service District No. 1 of the
Parish of Lasalle, State of Louisiana
d/b/a Hardtner Medical Center,
Louisiana
759. Hebert, Douglas (Sheriff Allen
Parish), Louisiana
760. Hedrick, Kenneth (Sheriff Concordia
Parish), Louisiana
761. Hilton, William (Sheriff Rapides
Parish), Louisiana
762. Iberia Parish, Louisiana
763. Iberia Parish School Board,
Louisiana
764. Jackson Parish Police Jury,
Louisiana
765. Jefferson Davis Parish Police Jury,
Louisiana
766. Jefferson Parish, Louisiana
767. Jefferson Parish Hospital Service
District 1, Louisiana
768. Jefferson Parish Hospital Service
District 2, Louisiana
769. Jones, Rickey (Sheriff Tensas
Parish), Louisiana
770. Kenner City, Louisiana
771. Lafourche Parish, Louisiana
772. LaFourche Parish School Board,
Louisiana
773. Lake Charles City, Louisiana
774. Lake Providence Town, Louisiana
775. LaSalle Parish, Louisiana
776. Lopinto, Joseph (Sheriff Jefferson
Parish), Louisiana
777. Lutcher Town, Louisiana
778. Madisonville Town, Louisiana
779. Mancuso, Tony (Sheriff Calcasieu
Parish), Louisiana
780. Mandeville City, Louisiana
781. McCain, Steven (Sheriff Grant
Parish), Louisiana
782. Monroe City, Louisiana
783. Morehouse Parish Police Jury,
Louisiana
784. Natchitoches Parish Council,
Louisiana
785. New Iberia City, Louisiana
786. North Caddo Hospital Service
District d/b/a North Caddo Medical
Center, Louisiana
787. Opelousas City, Louisiana
788. Opelousas General Hospital
Authority, A Louisiana Public Trust,
d/b/a Opelousas General Health
System, Louisiana
789. Ouachita Parish Police Jury,
Louisiana
790. Patterson City, Louisiana
791. Pearl River Town, Louisiana
792. Philley, Jerry (Sheriff West Carroll
Parish), Louisiana
793. Pineville City, Louisiana
794. Rapides Parish Police Jury,
Louisiana
795. Red River Fire District, Louisiana
796. Red River Parish, Louisiana
797. Richardson, Ronald (Sheriff Sabine
Parish), Louisiana
798. Richland Parish, Louisiana
799. Richwood Town, Louisiana
800. Russel, Jay (Sheriff Ouachita
Parish), Louisiana
801. Sabine Parish Police Jury, Louisiana
802. Saint Martinville City, Louisiana
803. Seal, Randy (Sheriff Washington
Parish), Louisiana
804. Shreveport City, Louisiana
805. Slidell City, Louisiana
806. Smith, Randy (Sheriff St. Tammany
Parish), Louisiana
807. Soileau, Edrick (Sheriff, Evangeline
Parish), Louisiana
808. St. Bernard Parish School Board,
Louisiana
809. St. Charles Parish, Louisiana
WITH TECHNICAL CORRECTIONS 02.03.2023
C-11
810. St. James Parish, Louisiana
811. St. James Parish School Board,
Louisiana
812. St. John the Baptist Parish, Louisiana
813. St. Landry Parish, Louisiana
814. St. Martin Parish, Louisiana
815. St. Mary Parish, Louisiana
816. St. Mary Parish School Board,
Louisiana
817. St. Tammany Fire District 1,
Louisiana
818. St. Tammany Fire District 12,
Louisiana
819. St. Tammany Fire District 13,
Louisiana
820. St. Tammany Fire District 2,
Louisiana
821. St. Tammany Fire District 3,
Louisiana
822. St. Tammany Fire District 4,
Louisiana
823. St. Tammany Fire District 5,
Louisiana
824. St. Tammany Parish, Louisiana
825. St. Tammany Parish Coroner,
Louisiana
826. Tubbs, Michael (Sheriff Morehouse
Parish), Louisiana
827. Union Parish, Louisiana
828. Vermilion Parish Police Jury,
Louisiana
829. Vernon Parish Police Jury, Louisiana
830. Washington Parish, Louisiana
831. Webster Parish, Louisiana
832. West Ascension Parish Hospital
Service District d/b/a Prevost
Memorial Hospital, Louisiana
833. West Baton Rouge Fire District 1,
Louisiana
834. West Baton Rouge Parish, Louisiana
835. West Carroll Parish Policy Jury,
Louisiana
836. West Monroe City, Louisiana
837. Wiley, Jeffrey (Sheriff, Ascension
Parish), Louisiana
838. Williams, Wydette (Sheriff East
Carroll Parish), Louisiana
839. Winn Parish, Louisiana
840. Woods, Ivy (Sheriff Jefferson Davis
Parish), Louisiana
841. Androscoggin County, Maine
842. Aroostook County, Maine
843. Auburn City, Maine
844. Augusta City, Maine
845. Bangor City, Maine
846. Bangor School Department, Maine
847. Biddeford City, Maine
848. Calais City, Maine
849. Cape Elizabeth School District,
Maine
850. Cumberland County, Maine
851. Ellsworth School Department, Maine
852. Kennebec County, Maine
853. Knox County, Maine
854. Lewiston City, Maine
855. Lincoln County, Maine
856. Maine Regional School Unit 10,
Maine
857. Maine Regional School Unit 13,
Maine
858. Maine Regional School Unit 25,
Maine
859. Maine Regional School Unit 26,
Maine
860. Maine Regional School Unit 29,
Maine
861. Maine Regional School Unit 34,
Maine
862. Maine Regional School Unit 40,
Maine
863. Maine Regional School Unit 50,
Maine
864. Maine Regional School Unit 57,
Maine
865. Maine Regional School Unit 60,
Maine
866. Maine Regional School Unit 71,
Maine
867. Maine Regional School Unit 9,
Maine
WITH TECHNICAL CORRECTIONS 02.03.2023
C-12
868. Maine School Administrative
District 11, Maine
869. Maine School Administrative
District 15, Maine
870. Maine School Administrative
District 28/Five Town Central
School District, Maine
871. Maine School Administrative
District 35, Maine
872. Maine School Administrative
District 44, Maine
873. Maine School Administrative
District 53, Maine
874. Maine School Administrative
District 55, Maine
875. Maine School Administrative
District 6, Maine
876. Maine School Administrative
District 61, Maine
877. Maine School Administrative
District 72, Maine
878. Penobscot County, Maine
879. Portland City, Maine
880. Portland School District, Maine
881. Rockland City, Maine
882. Saco City, Maine
883. Sagadahoc County, Maine
884. Sanford City, Maine
885. Scarborough School District, Maine
886. Somerset County, Maine
887. South Portland School Department,
Maine
888. St. George Municipal School
District, Maine
889. Waldo County, Maine
890. Washington County, Maine
891. Waterville City, Maine
892. Waterville School District, Maine
893. York County, Maine
894. Aberdeen City, Maryland
895. Allegany County, Maryland
896. Baltimore City, Maryland
897. Baltimore Public School District,
Maryland
898. Bel Air City, Maryland
899. Berlin City, Maryland
900. Bowie City, Maryland
901. Calvert County, Maryland
902. Cambridge City, Maryland
903. Caroline County, Maryland
904. Carroll County, Maryland
905. Charles County, Maryland
906. Charlestown City, Maryland
907. Cottage City Town, Maryland
908. Cumberland City, Maryland
909. Dorchester County, Maryland
910. Forest Heights Town, Maryland
911. Frederick City, Maryland
912. Frederick County, Maryland
913. Frostburg City, Maryland
914. Garrett County, Maryland
915. Grantsville City, Maryland
916. Hagerstown City, Maryland
917. Harford County, Maryland
918. Havre de Grace City, Maryland
919. Howard County, Maryland
920. Laurel City, Maryland
921. Montgomery County, Maryland
922. Mountain Lake Park City, Maryland
923. North Brentwood Town, Maryland
924. North East City, Maryland
925. Oakland City, Maryland
926. Perryville City, Maryland
927. Prince George’s County, Maryland
928. Seat Pleasant City, Maryland
929. Somerset County, Maryland
930. St. Mary’s County, Maryland
931. Talbot County, Maryland
932. Upper Marlboro Town, Maryland
933. Vienna City, Maryland
934. Washington County, Maryland
935. Wicomico County, Maryland
936. Acushnet Town, Massachusetts
937. Agawam Town, Massachusetts
938. Amesbury City, Massachusetts
939. Aquinnah Town, Massachusetts
940. Athol Town, Massachusetts
941. Auburn Town, Massachusetts
942. Ayer Town, Massachusetts
943. Barnstable Town, Massachusetts
944. Belchertown Town, Massachusetts
945. Beverly City, Massachusetts
WITH TECHNICAL CORRECTIONS 02.03.2023
C-13
946. Billerica Town, Massachusetts
947. Braintree Town, Massachusetts
948. Brewster Town, Massachusetts
949. Bridgewater Town, Massachusetts
950. Brockton City, Massachusetts
951. Brookline Town, Massachusetts
952. Cambridge City, Massachusetts
953. Canton Town, Massachusetts
954. Carver Town, Massachusetts
955. Charlton Town, Massachusetts
956. Chelmsford Town, Massachusetts
957. Chelsea City, Massachusetts
958. Chicopee City, Massachusetts
959. Clarksburg Town, Massachusetts
960. Clinton Town, Massachusetts
961. Danvers Town, Massachusetts
962. Dedham Town, Massachusetts
963. Dennis Town, Massachusetts
964. Douglas Town, Massachusetts
965. Dudley Town, Massachusetts
966. East Bridgewater Town,
Massachusetts
967. Eastham Town, Massachusetts
968. Easthampton City, Massachusetts
969. Easton Town, Massachusetts
970. Everett City, Massachusetts
971. Fairhaven Town, Massachusetts
972. Fall River City, Massachusetts
973. Falmouth Town, Massachusetts
974. Fitchburg City, Massachusetts
975. Framingham City, Massachusetts
976. Freetown Town, Massachusetts
977. Georgetown Town, Massachusetts
978. Gloucester City, Massachusetts
979. Grafton Town, Massachusetts
980. Greenfield City, Massachusetts
981. Hanson Town, Massachusetts
982. Haverhill City, Massachusetts
983. Holliston Town, Massachusetts
984. Holyoke City, Massachusetts
985. Hopedale Town, Massachusetts
986. Hull Town, Massachusetts
987. Kingston Town, Massachusetts
988. Lakeville Town, Massachusetts
989. Leicester Town, Massachusetts
990. Leominster City, Massachusetts
991. Leverett Town, Massachusetts
992. Longmeadow Town, Massachusetts
993. Lowell City, Massachusetts
994. Ludlow Town, Massachusetts
995. Lunenberg Town, Massachusetts
996. Lynn City, Massachusetts
997. Lynnfield Town, Massachusetts
998. Malden City, Massachusetts
999. Marblehead Town, Massachusetts
1000. Marshfield Town, Massachusetts
1001. Mashpee Town, Massachusetts
1002. Mattapoisett Town, Massachusetts
1003. Medford City, Massachusetts
1004. Melrose City, Massachusetts
1005. Methuen City, Massachusetts
1006. Middleborough Town,
Massachusetts
1007. Milford Town, Massachusetts
1008. Millbury Town, Massachusetts
1009. Millis Town, Massachusetts
1010. Natick Town, Massachusetts
1011. New Bedford City, Massachusetts
1012. Newburyport City, Massachusetts
1013. North Adams City, Massachusetts
1014. North Andover Town, Massachusetts
1015. North Attleborough Town,
Massachusetts
1016. North Reading Town, Massachusetts
1017. Northampton City, Massachusetts
1018. Northbridge Town, Massachusetts
1019. Norton Town, Massachusetts
1020. Norwell Town, Massachusetts
1021. Norwood Town, Massachusetts
1022. Orange Town, Massachusetts
1023. Oxford Town, Massachusetts
1024. Palmer Town, Massachusetts
1025. Peabody City, Massachusetts
1026. Pembroke Town, Massachusetts
1027. Pittsfield City, Massachusetts
1028. Plainville Town, Massachusetts
1029. Plymouth Town, Massachusetts
1030. Provincetown Town, Massachusetts
1031. Quincy City, Massachusetts
1032. Randolph Town, Massachusetts
1033. Rehoboth Town, Massachusetts
1034. Revere City, Massachusetts
WITH TECHNICAL CORRECTIONS 02.03.2023
C-14
1035. Rockland Town, Massachusetts
1036. Salem City, Massachusetts
1037. Salisbury Town, Massachusetts
1038. Sandwich Town, Massachusetts
1039. Scituate Town, Massachusetts
1040. Seekonk Town, Massachusetts
1041. Sheffield Town, Massachusetts
1042. Shirley Town, Massachusetts
1043. Somerset Town, Massachusetts
1044. Somerville City, Massachusetts
1045. South Hadley Town, Massachusetts
1046. Southbridge Town, Massachusetts
1047. Spencer Town, Massachusetts
1048. Springfield City, Massachusetts
1049. Stoneham Town, Massachusetts
1050. Stoughton Town, Massachusetts
1051. Sturbridge Town, Massachusetts
1052. Sudbury Town, Massachusetts
1053. Sutton Town, Massachusetts
1054. Swampscott Town, Massachusetts
1055. Templeton Town, Massachusetts
1056. Tewksbury Town, Massachusetts
1057. Truro Town, Massachusetts
1058. Tyngsborough Town, Massachusetts
1059. Upton Town, Massachusetts
1060. Wakefield Town, Massachusetts
1061. Walpole Town, Massachusetts
1062. Ware Town, Massachusetts
1063. Warren Town, Massachusetts
1064. Watertown Town, Massachusetts
1065. Wellfleet Town, Massachusetts
1066. West Boylston Town, Massachusetts
1067. West Bridgewater Town,
Massachusetts
1068. West Springfield Town,
Massachusetts
1069. Westborough Town, Massachusetts
1070. Westford Town, Massachusetts
1071. Weymouth Town, Massachusetts
1072. Williamsburg Town, Massachusetts
1073. Wilmington Town, Massachusetts
1074. Winchendon Town, Massachusetts
1075. Winthrop Town, Massachusetts
1076. Woburn City, Massachusetts
1077. Worcester City, Massachusetts
1078. Alcona County, Michigan
1079. Alger County, Michigan
1080. Alpena County, Michigan
1081. Antrim County, Michigan
1082. Arenac County, Michigan
1083. Baraga County, Michigan
1084. Benzie County, Michigan
1085. Berrien County, Michigan
1086. Branch County, Michigan
1087. Calhoun County, Michigan
1088. Canton Charter Township, Michigan
1089. Cass County, Michigan
1090. Charlevoix County, Michigan
1091. Chippewa County, Michigan
1092. Clinton Charter Township, Michigan
1093. Clinton County, New York
1094. Crawford County, Michigan
1095. Delta County, Michigan
1096. Detroit City, Michigan
1097. Dickinson County, Michigan
1098. East Lansing City, Michigan
1099. Eaton County, Michigan
1100. Escanaba City, Michigan
1101. Genesee County, Michigan
1102. Grand Rapids City, Michigan
1103. Grand Traverse County, Michigan
1104. Gratiot County, Michigan
1105. Hillsdale County, Michigan
1106. Houghton County, Michigan
1107. Huron Charter Township, Michigan
1108. Ingham County, Michigan
1109. Ionia County, Michigan
1110. Iosco County, Michigan
1111. Iron County, Michigan
1112. Iron Mountain City, Michigan
1113. Isabella County, Michigan
1114. Jackson City, Michigan
1115. Kalamazoo County, Michigan
1116. Kent County, Michigan
1117. Lake County, Michigan
1118. Lansing City, Michigan
1119. Leelanau County, Michigan
1120. Lenawee County, Michigan
1121. Livingston County, Michigan
1122. Livonia City, Michigan
1123. Luce County, Michigan
1124. Macomb County, Michigan
WITH TECHNICAL CORRECTIONS 02.03.2023
C-15
1125. Manistee County, Michigan
1126. Marquette County, Michigan
1127. Mason County, Michigan
1128. Monroe County, Michigan
1129. Montcalm County, Michigan
1130. Montmorency County, Michigan
1131. Muskegon County, Michigan
1132. Newaygo County, Michigan
1133. Northville Charter Township,
Michigan
1134. Oakland County, Michigan
1135. Oceana County, Michigan
1136. Ogemaw County, Michigan
1137. Ontonagon County, Michigan
1138. Osceola County, Michigan
1139. Otsego County, Michigan
1140. Pittsfield Charter Township,
Michigan
1141. Pontiac City, Michigan
1142. Presque Isle County, Michigan
1143. Romulus City, Michigan
1144. Roscommon County, Michigan
1145. Saginaw County, Michigan
1146. Sanilac County, Michigan
1147. Sault Ste. Marie City, Michigan
1148. Shiawassee County, Michigan
1149. St. Clair County, Michigan
1150. Traverse City, Michigan
1151. Tuscola County, Michigan
1152. Van Buren Charter Township,
Michigan
1153. Washtenaw County, Michigan
1154. Wayne City, Michigan
1155. Wayne County, Michigan
1156. Westland City, Michigan
1157. Wexford County, Michigan
1158. Anoka County, Minnesota
1159. Big Stone County, Minnesota
1160. Coon Rapids City, Minnesota
1161. Duluth City, Minnesota
1162. Minnetonka Public School District
No. 276, Minnesota
1163. North St. Paul City, Minnesota
1164. Pine County, Minnesota
1165. Proctor City, Minnesota
1166. Rochester City, Minnesota
1167. Saint Paul City, Minnesota
1168. Yellow Medicine County, Minnesota
1169. Adams County, Mississippi
1170. Amite County, Mississippi
1171. Arcola Town, Mississippi
1172. Bolivar County, Mississippi
1173. Centreville Town, Mississippi
1174. Clarksdale City, Mississippi
1175. Covington County, Mississippi
1176. DeSoto County, Mississippi
1177. Forrest County, Mississippi
1178. Greenwood City, Mississippi
1179. Grenada City, Mississippi
1180. Grenada County, Mississippi
1181. Gulfport City, Mississippi
1182. Harrison County, Mississippi
1183. Hattiesburg City, Mississippi
1184. Hinds County, Mississippi
1185. Holly Springs City, Mississippi
1186. Indianola City, Mississippi
1187. Issaquena County, Mississippi
1188. Jackson City, Mississippi
1189. Jonestown City, Mississippi
1190. Laurel City, Mississippi
1191. Leflore County, Mississippi
1192. Long Beach City, Mississippi
1193. Lumberton City, Mississippi
1194. Madison County, Mississippi
1195. Meridian City, Mississippi
1196. Mound Bayou City, Mississippi
1197. Pascagoula City, Mississippi
1198. Pearl River County, Mississippi
1199. Prentiss County, Mississippi
1200. Scott County, Mississippi
1201. Stone County, Mississippi
1202. Summit Town, Mississippi
1203. Tippah County, Mississippi
1204. Washington County, Mississippi
1205. Audrain County, Missouri
1206. Barton County, Missouri
1207. Boone County, Missouri
1208. Buchanan County, Missouri
1209. Callaway County, Missouri
1210. Camden County, Missouri
1211. Cass County, Missouri
1212. Chariton County, Missouri
WITH TECHNICAL CORRECTIONS 02.03.2023
C-16
1213. Cole County, Missouri
1214. Douglas County, Missouri
1215. Franklin County, Missouri
1216. Gasconade County, Missouri
1217. Harrisonville City, Missouri
1218. Howell County, Missouri
1219. Jackson County, Missouri
1220. Jefferson County, Missouri
1221. Johnson County, Missouri
1222. Kansas City, Missouri
1223. Knox County, Missouri
1224. Lewis County, Missouri
1225. Lincoln County, Missouri
1226. Maries County, Missouri
1227. Miller County, Missouri
1228. Moniteau County, Missouri
1229. Montgomery County, Missouri
1230. Morgan County, Missouri
1231. Osage County, Missouri
1232. Ozark County, Missouri
1233. Pemiscot County, Missouri
1234. Pettis County, Missouri
1235. Phelps County, Missouri
1236. Pulaski County, Missouri
1237. Randolph County, Missouri
1238. Reynolds County, Missouri
1239. Ripley County, Missouri
1240. Saint Joseph City, Missouri
1241. Schuyler County, Missouri
1242. Sedalia City, Missouri
1243. Shannon County, Missouri
1244. Shelby County, Missouri
1245. Springfield City, Missouri
1246. St. Charles County, Missouri
1247. St. Francois County, Missouri
1248. St. Louis County, Missouri
1249. Warren County, Missouri
1250. Webster County, Missouri
1251. Wright County, Missouri
1252. Anaconda-Deer Lodge County,
Montana
1253. Cascade County, Montana
1254. Gallatin County, Montana
1255. Great Falls City, Montana
1256. Lake County, Montana
1257. Missoula City, Montana
1258. Douglas County, Nebraska
1259. Knox County, Nebraska
1260. Lincoln County, Nebraska
1261. Sarpy County, Nebraska
1262. Boulder City, Nevada
1263. Carson City, Nevada
1264. Churchill County, Nevada
1265. Clark County, Nevada
1266. Henderson City, Nevada
1267. Las Vegas City, Nevada
1268. Mesquite City, Nevada
1269. North Las Vegas City, Nevada
1270. Nye County, Nevada
1271. Sparks City, Nevada
1272. Washoe County, Nevada
1273. West Wendover City, Nevada
1274. Belknap County, New Hampshire
1275. Belmont City, New Hampshire
1276. Berlin City, New Hampshire
1277. Carroll County, New Hampshire
1278. Cheshire County, New Hampshire
1279. Claremont City, New Hampshire
1280. Concord City, New Hampshire
1281. Coos County, New Hampshire
1282. Derry Town, New Hampshire
1283. Franklin City, New Hampshire
1284. Grafton County, New Hampshire
1285. Goshen School District, New
Hampshire
1286. Hillsborough County, New
Hampshire
1287. Keene City, New Hampshire
1288. Kearsarge Regional School DistrictSchool Administrative Unit 65, New Hampshire
1289. Laconia City, New Hampshire
1290. Lebanon School District, New
Hampshire
1291. Londonderry Town, New Hampshire
1292. Manchester City, New Hampshire
1293. Nashua City, New Hampshire
1294. Pittsfield School District, New
Hampshire
1295. Rockingham County, New
Hampshire
1296. Strafford County, New Hampshire
WITH TECHNICAL CORRECTIONS 02.03.2023
C-17
1297. Sullivan County, New Hampshire
1298. Tamworth School District, New
Hampshire
1299. Atlantic County, New Jersey
1300. Barnegat Township, New Jersey
1301. Bayonne City, New Jersey
1302. Bergen County, New Jersey
1303. Burlington County, New Jersey
1304. Camden County, New Jersey
1305. Clifton City, New Jersey
1306. Clinton Town, New Jersey
1307. Elizabeth City, New Jersey
1308. Essex County, New Jersey
1309. Hudson County, New Jersey
1310. Hunterdon County, New Jersey
1311. Jersey City, New Jersey
1312. Ocean County, New Jersey
1313. Paramus Borough, New Jersey
1314. Passaic County, New Jersey
1315. Paterson City, New Jersey
1316. Ridgefield Borough, New Jersey
1317. Saddle Brook Township, New Jersey
1318. Sussex County, New Jersey
1319. Trenton City, New Jersey
1320. Vineland City, New Jersey
1321. Albany City, New York
1322. Albany County, New York
1323. Allegany County, New York
1324. Amityville Village, New York
1325. Amsterdam City, New York
1326. Auburn City, New York
1327. Babylon Town, New York
1328. Babylon Village, New York
1329. Bellmore Fire District, New York
1330. Bellport Village, New York
1331. Branch Village, New York
1332. Brookhaven Town, New York
1333. Broome County, New York
1334. Buffalo City, New York
1335. Centereach Fire District, New York
1336. Clarkstown Town, New York
1337. Clinton County, Michigan
1338. Columbia County, New York
1339. Cortland County, New York
1340. Dutchess County, New York
1341. East Hampton Village, New York
1342. East Rockaway Village, New York
1343. Erie County, New York
1344. Farmingdale Village, New York
1345. Floral Park Village, New York
1346. Franklin County, New York
1347. Friendship Fire & Hose Co., New
York
1348. Fulton County, New York
1349. Garden City Village, New York
1350. Genesee County, New York
1351. Geneva City, New York
1352. Great Neck Village, New York
1353. Greene County, New York
1354. Greenport Village, New York
1355. Hamilton County, New York
1356. Hauppauge Fire District, New York
1357. Haverstraw Town, New York
1358. Hempstead Town, New York
1359. Hempstead Village, New York
1360. Herkimer County, New York
1361. Herkimer Village, New York
1362. Hicksville Water District, New York
1363. Huntington Town, New York
1364. Island Park Village, New York
1365. Islandia Village, New York
1366. Islip Terrance Fire District, New
York
1367. Islip Town, New York
1368. Ithaca City, New York
1369. Jefferson County, New York
1370. Kingston City, New York
1371. Lackawanna City, New York
1372. Lake Grove Village, New York
1373. Lawrence Village, New York
1374. Levittown Fire District, New York
1375. Lewis County, New York
1376. Lindenhurst Village, New York
1377. Lloyd Harbor Village, New York
1378. Long Beach City, New York
1379. Lynbrook Village, New York
1380. Massapequa Park Village, New York
1381. Melville Fire District, New York
1382. Merrick Library, New York
1383. Mill Neck Village, New York
1384. Miller Place Fire District, New York
1385. Monroe County, New York
WITH TECHNICAL CORRECTIONS 02.03.2023
C-18
1386. Montgomery County, New York
1387. Mount Sinai Fire District, New York
1388. Nesconset Fire District, New York
1389. New Hyde Park Village, New York
1390. New York City, New York
1391. Niagara County, New York
1392. Nissequogue Village, New York
1393. North Hempstead Town, New York
1394. North Merrick Fire District, New
York
1395. North Patchogue Fire District, New
York
1396. Northport Village, New York
1397. Ogdensburg City, New York
1398. Old Westbury Village, New York
1399. Oneida County, New York
1400. Onondaga County, New York
1401. Ontario County, New York
1402. Orange County, New York
1403. Orangetown Town, New York
1404. Oswego County, New York
1405. Oyster Bay Town, New York
1406. Patchogue Village, New York
1407. Plattsburgh City, New York
1408. Poquott Village, New York
1409. Port Washington North Village, New
York
1410. Port Washington Water District,
New York
1411. Poughkeepsie City, New York
1412. Poughkeepsie Town, New York
1413. Ramapo Town, New York
1414. Rensselaer County, New York
1415. Ridge Fire District, New York
1416. Riverhead Town, New York
1417. Rochester City, New York
1418. Rochester Public School District,
New York
1419. Rockland County, New York
1420. Rockville Centre Public Library,
New York
1421. Rome City, New York
1422. Roslyn Water District, New York
1423. Saltaire Village, New York
1424. Saratoga County, New York
1425. Saratoga Springs City, New York
1426. Schenectady City, New York
1427. Schenectady County, New York
1428. Schoharie County, New York
1429. Schuyler County, New York
1430. Seneca County, New York
1431. Smithtown Fire District, New York
1432. Smithtown Town, New York
1433. South Farmingdale Fire District,
New York
1434. Southampton Town, New York
1435. Southold Town, New York
1436. Southwestern Central School
District, New York
1437. St. James Fire District, New York
1438. St. Lawrence County, New York
1439. Steuben County, New York
1440. Stewart Manor Village, New York
1441. Stony Brook Fire District, New York
1442. Stony Point Town, New York
1443. Suffern Village, New York
1444. Sullivan County, New York
1445. Syracuse City, New York
1446. Tompkins County, New York
1447. Troy City, New York
1448. Ulster County, New York
1449. Utica City, New York
1450. Valley Stream Village, New York
1451. Washington County, New York
1452. West Hampton Dunes, New York
1453. West Haverstraw Village, New York
1454. West Hempstead Public Library,
New York
1455. Westbury Village, New York
1456. Westchester County, New York
1457. Wyoming County, New York
1458. Yonkers City, New York
1459. Alamance County, North Carolina
1460. Anson County, North Carolina
1461. Ashe County, North Carolina
1462. Beaufort County, North Carolina
1463. Bladen County, North Carolina
1464. Brunswick County, North Carolina
1465. Buncombe County, North Carolina
1466. Burke County, North Carolina
1467. Cabarrus County, North Carolina
1468. Caldwell County, North Carolina
WITH TECHNICAL CORRECTIONS 02.03.2023
C-19
1469. Camden County, North Carolina
1470. Canton City, North Carolina
1471. Carteret County, North Carolina
1472. Catawba County, North Carolina
1473. Chatham County, North Carolina
1474. Cleveland County, North Carolina
1475. Columbus County, North Carolina
1476. Craven County, North Carolina
1477. Cumberland County, North Carolina
1478. Dare County, North Carolina
1479. Davidson County, North Carolina
1480. Davie County, North Carolina
1481. Duplin County, North Carolina
1482. Durham County, North Carolina
1483. Fayetteville City, North Carolina
1484. Forsyth County, North Carolina
1485. Franklin County, North Carolina
1486. Gaston County, North Carolina
1487. Granville County, North Carolina
1488. Greensboro City, North Carolina
1489. Guilford County, North Carolina
1490. Halifax County, North Carolina
1491. Haywood County, North Carolina
1492. Henderson City, North Carolina
1493. Hickory City, North Carolina
1494. Iredell County, North Carolina
1495. Jacksonville City, North Carolina
1496. Lee County, North Carolina
1497. Lincoln County, North Carolina
1498. Madison County, North Carolina
1499. Martin County, North Carolina
1500. McDowell County, North Carolina
1501. Mecklenburg County, North
Carolina
1502. Mitchell County, North Carolina
1503. Moore County, North Carolina
1504. New Hanover County, North
Carolina
1505. Onslow County, North Carolina
1506. Orange County, North Carolina
1507. Pamlico County, North Carolina
1508. Pasquotank County, North Carolina
1509. Person County, North Carolina
1510. Pitt County, North Carolina
1511. Polk County, North Carolina
1512. Randolph County, North Carolina
1513. Richmond County, North Carolina
1514. Robeson County, North Carolina
1515. Rockingham County, North Carolina
1516. Rowan County, North Carolina
1517. Rutherford County, North Carolina
1518. Sampson County, North Carolina
1519. Scotland County, North Carolina
1520. Stokes County, North Carolina
1521. Surry County, North Carolina
1522. Vance County, North Carolina
1523. Watauga County, North Carolina
1524. Wayne County, North Carolina
1525. Wilkes County, North Carolina
1526. Wilmington City, North Carolina
1527. Winston-Salem City, North Carolina
1528. Yadkin County, North Carolina
1529. Yancey County, North Carolina
1530. Barnes County, North Dakota
1531. Benson County, North Dakota
1532. Bismarck City, North Dakota
1533. Burleigh County, North Dakota
1534. Devils Lake City, North Dakota
1535. Dickey County, North Dakota
1536. Dunn County, North Dakota
1537. Eddy County, North Dakota
1538. Foster County, North Dakota
1539. Grand Forks County, North Dakota
1540. Lamoure County, North Dakota
1541. Lisbon City, North Dakota
1542. McKenzie County, North Dakota
1543. McLean County, North Dakota
1544. Mercer County, North Dakota
1545. Mountrail County, North Dakota
1546. Pembina County, North Dakota
1547. Pierce County, North Dakota
1548. Ramsey County, North Dakota
1549. Ransom County, North Dakota
1550. Richland County, North Dakota
1551. Rolette County, North Dakota
1552. Sargent County, North Dakota
1553. Stark County, North Dakota
1554. Towner County, North Dakota
1555. Walsh County, North Dakota
1556. Ward County, North Dakota
1557. Wells County, North Dakota
1558. Williams County, North Dakota
WITH TECHNICAL CORRECTIONS 02.03.2023
C-20
1559. Akron City, Ohio
1560. Ashland City, Ohio
1561. Ashland County, Ohio
1562. Ashtabula County, Ohio
1563. Athens County, Ohio
1564. Auglaize County, Ohio
1565. Barberton City, Ohio
1566. Belmont County, Ohio
1567. Boardman Local Schools BOE, Ohio
1568. Boston Heights Village, Ohio
1569. Boston Township, Ohio
1570. Broadview Heights City, Ohio
1571. Brooklyn Heights Village, Ohio
1572. Brown County, Ohio
1573. Butler County, Ohio
1574. Champaign County, Ohio
1575. Cincinnati City, Ohio
1576. Clermont County, Ohio
1577. Cleveland City, Ohio
1578. Clinton County, Ohio
1579. Clinton Village, Ohio
1580. Copley Township, Ohio
1581. Coshocton County, Ohio
1582. Coventry Township, Ohio
1583. Crawford County, Ohio
1584. Cuyahoga County, Ohio
1585. Cuyahoga Falls City, Ohio
1586. Darke County, Ohio
1587. Dayton City, Ohio
1588. Delaware County, Ohio
1589. East Cleveland City, Ohio
1590. Elyria City, Ohio
1591. Erie County, Ohio
1592. Euclid City, Ohio
1593. Fairfield City, Ohio
1594. Fairfield County, Ohio
1595. Fairlawn City, Ohio
1596. Fayette County, Ohio
1597. Findlay City, Ohio
1598. Franklin County, Ohio
1599. Fulton County, Ohio
1600. Gallia County, Ohio
1601. Garfield Heights City, Ohio
1602. Geauga County, Ohio
1603. Green City, Ohio
1604. Guernsey County, Ohio
1605. Hamilton City, Ohio
1606. Hamilton County, Ohio
1607. Hocking County, Ohio
1608. Huron City, Ohio
1609. Huron County, Ohio
1610. Ironton City, Ohio
1611. Jackson County, Ohio
1612. Jefferson County, Ohio
1613. Knox County, Ohio
1614. Lake County, Ohio
1615. Lakemore Village, Ohio
1616. Lakewood City, Ohio
1617. Lawrence County, Ohio
1618. Lebanon City, Ohio
1619. Lexington Village, Ohio
1620. Liberty Local Schools, Ohio
1621. Licking County, Ohio
1622. Logan County, Ohio
1623. Lorain City, Ohio
1624. Lorain County, Ohio
1625. Lucas County, Ohio
1626. Lyndhurst City, Ohio
1627. Macedonia City, Ohio
1628. Marion County, Ohio
1629. Mayfield Heights City, Ohio
1630. Meigs County, Ohio
1631. Mercer County, Ohio
1632. Middletown City, Ohio
1633. Mogadore Village, Ohio
1634. Montgomery County, Ohio
1635. Munroe Falls City, Ohio
1636. Muskingum County, Ohio
1637. New Franklin City, Ohio
1638. Newburgh Heights Village, Ohio
1639. Noble County, Ohio
1640. North Olmsted City, Ohio
1641. North Ridgeville City, Ohio
1642. North Royalton City, Ohio
1643. Norton City, Ohio
1644. Olmsted Falls City, Ohio
1645. Painesville Township, Ohio
1646. Parma City, Ohio
1647. Parma Heights City, Ohio
1648. Peninsula Village, Ohio
1649. Perry County, Ohio
1650. Portage County, Ohio
WITH TECHNICAL CORRECTIONS 02.03.2023
C-21
1651. Portsmouth City, Ohio
1652. Richfield Village, Ohio
1653. Richland County Children’s
Services, Ohio
1654. Ross County, Ohio
1655. Sandusky County, Ohio
1656. Scioto County, Ohio
1657. Seneca County, Ohio
1658. Seven Hills City, Ohio
1659. Shelby County, Ohio
1660. Silver Lake Village, Ohio
1661. Springfield Township, Summit
County, Ohio
1662. St. Mary’s City, Ohio
1663. Stark County, Ohio
1664. Stow City, Ohio
1665. Strongsville City, Ohio
1666. Summit County, Ohio
1667. Tallmadge City, Ohio
1668. Toledo City, Ohio
1669. Trumbull County, Ohio
1670. Tuscarawas County, Ohio
1671. Valley Fire District, Ohio
1672. Van Wert City, Ohio
1673. Van Wert County, Ohio
1674. Warren City, Ohio
1675. Warrensville Heights, Ohio
1676. Washington County, Ohio
1677. Wayne County, Ohio
1678. Wickliffe City, Ohio
1679. Williams County, Ohio
1680. Altus City, Oklahoma
1681. Atoka County, Oklahoma
1682. Beckham County, Oklahoma
1683. Caddo County, Oklahoma
1684. Choctaw County, Oklahoma
1685. Cimarron County, Oklahoma
1686. Cleveland County, Oklahoma
1687. Coal County, Oklahoma
1688. Collinsville City, Oklahoma
1689. Comanche County, Oklahoma
1690. Craig County, Oklahoma
1691. Creek County, Oklahoma
1692. Custer County, Oklahoma
1693. Delaware County, Oklahoma
1694. Dewey County, Oklahoma
1695. El Reno City, Oklahoma
1696. Elk City, Oklahoma
1697. Enid City, Oklahoma
1698. Garvin County, Oklahoma
1699. Grady County, Oklahoma
1700. Greer County, Oklahoma
1701. Harper County, Oklahoma
1702. Haskell County, Oklahoma
1703. Hughes County, Oklahoma
1704. Jackson County, Oklahoma
1705. Jefferson County, Oklahoma
1706. Jenks City, Oklahoma
1707. Johnston County, Oklahoma
1708. Kay County, Oklahoma
1709. Kiowa County, Oklahoma
1710. Latimer County, Oklahoma
1711. LeFlore County, Oklahoma
1712. Lincoln County, Oklahoma
1713. Logan County, Oklahoma
1714. Love County, Oklahoma
1715. Major County, Oklahoma
1716. Mayes County, Oklahoma
1717. McClain County, Oklahoma
1718. McCurtain County, Oklahoma
1719. Midwest City, Oklahoma
1720. Noble County, Oklahoma
1721. Nowata County, Oklahoma
1722. Okfuskee County, Oklahoma
1723. Oklahoma County, Oklahoma
1724. Okmulgee County, Oklahoma
1725. Osage County, Oklahoma
1726. Ottawa County, Oklahoma
1727. Pawnee County, Oklahoma
1728. Payne County, Oklahoma
1729. Pittsburg County, Oklahoma
1730. Pottawatomie County, Oklahoma
1731. Rogers County, Oklahoma
1732. Seminole County, Oklahoma
1733. Shawnee City, Oklahoma
1734. Stephens County, Oklahoma
1735. Stillwater City, Oklahoma
1736. Texas County, Oklahoma
1737. Tillman County, Oklahoma
1738. Tulsa City, Oklahoma
1739. Tulsa County, Oklahoma
1740. Washington County, Oklahoma
WITH TECHNICAL CORRECTIONS 02.03.2023
C-22
1741. Woods County, Oklahoma
1742. Woodward County, Oklahoma
1743. Yukon City, Oklahoma
1744. Coos County, Oregon
1745. Portland City, Oregon
1746. Adams County, Pennsylvania
1747. Allegheny County, Pennsylvania
1748. Armstrong County, Pennsylvania
1749. Bedford County, Pennsylvania
1750. Bensalem Township, Pennsylvania
1751. Bradford County, Pennsylvania
1752. Bristol Township, Pennsylvania
1753. Bucks County, Pennsylvania
1754. Cambria County, Pennsylvania
1755. Carbon County, Pennsylvania
1756. Chardo, District Attorney of
Dauphin County, Pennsylvania
1757. Clarion County, Pennsylvania
1758. Clearfield County, Pennsylvania
1759. Clinton County, Pennsylvania
1760. Coatesville City, Pennsylvania
1761. Columbia County, Pennsylvania
1762. Delaware County, Pennsylvania
1763. Edwardsville Borough, Pennsylvania
1764. Erie County, Pennsylvania
1765. Exeter Borough, Pennsylvania
1766. Fairview Township, Luzerne
County, Pennsylvania
1767. Fayette County, Pennsylvania
1768. Forty Fort Borough, Pennsylvania
1769. Franklin County, Pennsylvania
1770. Greene County, Pennsylvania
1771. Hanover Township, Luzerne County,
Pennsylvania
1772. Hazleton City, Pennsylvania
1773. Hirz, District Attorney of Erie
County, Pennsylvania
1774. Houck, District Attorney of
Northampton County, Pennsylvania
1775. Indiana County, Pennsylvania
1776. Kingston Borough, Pennsylvania
1777. Lackawanna County, Pennsylvania
1778. Lawrence County, Pennsylvania
1779. Lehigh County, Pennsylvania
1780. Lock Haven City, Pennsylvania
1781. Lower Makefield Township,
Pennsylvania
1782. Luzerne County, Pennsylvania
1783. Lycoming County, Pennsylvania
1784. Mercer County, Pennsylvania
1785. Middletown Township, Bucks
County, Pennsylvania
1786. Morrisville Borough, Pennsylvania
1787. Nanticoke City, Pennsylvania
1788. Newtown Township, Bucks County,
Pennsylvania
1789. Norristown Municipality,
Pennsylvania
1790. Northampton County, Pennsylvania
1791. Northumberland County,
Pennsylvania
1792. Philadelphia City, Pennsylvania
1793. Pike County, Pennsylvania
1794. Pittsburgh City, Pennsylvania
1795. Plains Township, Pennsylvania
1796. Ryan, District Attorney of Chester
County, Pennsylvania
1797. Schuylkill County, Pennsylvania
1798. Sugar Notch Borough, Pennsylvania
1799. Tioga County, Pennsylvania
1800. Warminster Township, Pennsylvania
1801. Warrington Township, Pennsylvania
1802. Washington County, Pennsylvania
1803. Weintraub, District Attorney of
Bucks County, Pennsylvania
1804. West Norriton Township,
Pennsylvania
1805. West Pittston, Pennsylvania
1806. Westmoreland County, Pennsylvania
1807. Wilkes-Barre City, Pennsylvania
1808. Wilkes-Barre Township,
Pennsylvania
1809. Wright Township, Pennsylvania
1810. Wyoming Borough, Pennsylvania
1811. Wyoming County, Pennsylvania
1812. Zappala, District Attorney of
Allegheny County, Pennsylvania
1813. Ziccarelli, District Attorney of
Westmoreland County, Pennsylvania
1814. Aibonito Municipality, Puerto Rico
1815. Aguada Municipality, Puerto Rico
WITH TECHNICAL CORRECTIONS 02.03.2023
C-23
1816. Aguadilla Municipality, Puerto Rico
1817. Anasco Municipality, Puerto Rico
1818. Arecibo Municipality, Puerto Rico
1819. Barranquitas Municipality, Puerto
Rico
1820. Cabo Rojo Municipality, Puerto Rico
1821. Camuy Municipality, Puerto Rico
1822. Canovanas Municipality, Puerto
Rico
1823. Comerio Municipality, Puerto Rico
1824. Dorado Municipality, Puerto Rico
1825. Fajardo Municipality, Puerto Rico
1826. Guanica Municipality, Puerto Rico
1827. Guayanilla Municipality, Puerto
Rico
1828. Hatillo Municipality, Puerto Rico
1829. Isabela Municipality, Puerto Rico
1830. Jayuya Municipality, Puerto Rico
1831. Juana Diaz Municipality, Puerto
Rico
1832. Juncos Municipality, Puerto Rico
1833. Lares Municipality, Puerto Rico
1834. Las Marias Municipality, Puerto
Rico
1835. Loiza Municipality, Puerto Rico
1836. Manati Municipality, Puerto Rico
1837. Maricao Municipality, Puerto Rico
1838. Moca Municipality, Puerto Rico
1839. Morovis Municipality, Puerto Rico
1840. Orocovis Municipality, Puerto Rico
1841. Penuelas Municipality, Puerto Rico
1842. Ponce Municipality, Puerto Rico
1843. Quebradillas Municipality, Puerto
Rico
1844. Rincon Municipality, Puerto Rico
1845. Rio Grande Municipality, Puerto
Rico
1846. Sabana Grande Municipality, Puerto
Rico
1847. Salinas Municipality, Puerto Rico
1848. San German Municipality, Puerto
Rico
1849. San Juan Municipality, Puerto Rico
1850. San Lorenzo Municipality, Puerto
Rico
1851. Santa Isabel Municipality, Puerto
Rico
1852. Toa Alta Municipality, Puerto Rico
1853. Trujillo Alto Municipality, Puerto
Rico
1854. Vega Alta Municipality, Puerto Rico
1855. Vega Baja Municipality, Puerto Rico
1856. Yabucoa Municipality, Puerto Rico
1857. Barrington Town, Rhode Island
1858. Bristol Town, Rhode Island
1859. Burrillville Town, Rhode Island
1860. Central Falls City, Rhode Island
1861. Charlestown Town, Rhode Island
1862. Coventry Town, Rhode Island
1863. Cranston City, Rhode Island
1864. Cumberland Town, Rhode Island
1865. East Greenwich Town, Rhode Island
1866. East Providence City, Rhode Island
1867. Foster Town, Rhode Island
1868. Glocester Town, Rhode Island
1869. Hopkinton Town, Rhode Island
1870. Jamestown Town, Rhode Island
1871. Johnston Town, Rhode Island
1872. Middletown Town, Rhode Island
1873. Narragansett Town, Rhode Island
1874. Newport City, Rhode Island
1875. North Kingstown Town, Rhode
Island
1876. North Providence Town, Rhode
Island
1877. Pawtucket City, Rhode Island
1878. Portsmouth Town, Rhode Island
1879. Richmond Town, Rhode Island
1880. Scituate Town, Rhode Island
1881. Smithfield Town, Rhode Island
1882. South Kingstown Town, Rhode
Island
1883. Warren Town, Rhode Island
1884. Warwick City, Rhode Island
1885. West Greenwich Town, Rhode
Island
1886. West Warwick Town, Rhode Island
1887. Westerly Town, Rhode Island
1888. Woonsocket City, Rhode Island
1889. Abbeville County, South Carolina
1890. Aiken County, South Carolina
WITH TECHNICAL CORRECTIONS 02.03.2023
C-24
1891. Allendale County, South Carolina
1892. Anderson County, South Carolina
1893. Bamberg County, South Carolina
1894. Barnwell County, South Carolina
1895. Beaufort County, South Carolina
1896. Berkeley County, South Carolina
1897. Calhoun County, South Carolina
1898. Charleston City, South Carolina
1899. Charleston County, South Carolina
1900. Cherokee County, South Carolina
1901. Chester City, South Carolina
1902. Chester County, South Carolina
1903. Chesterfield County, South Carolina
1904. Clarendon County, South Carolina
1905. Colleton County, South Carolina
1906. Dillon County, South Carolina
1907. Dorchester County, South Carolina
1908. Edgefield County, South Carolina
1909. Fairfield County, South Carolina
1910. Florence County, South Carolina
1911. Georgetown City, South Carolina
1912. Georgetown County, South Carolina
1913. Greenville County, South Carolina
1914. Greenwood County, South Carolina
1915. Hampton County, South Carolina
1916. Horry County, South Carolina
1917. Jasper County, South Carolina
1918. Kershaw County, South Carolina
1919. Lancaster County, South Carolina
1920. Laurens County, South Carolina
1921. Lee County, South Carolina
1922. Lexington County, South Carolina
1923. Marion County, South Carolina
1924. Marlboro County, South Carolina
1925. McCormick County, South Carolina
1926. Mt. Pleasant Town, South Carolina
1927. Myrtle Beach City, South Carolina
1928. Newberry County, South Carolina
1929. North Charleston City, South
Carolina
1930. Oconee County, South Carolina
1931. Orangeburg City, South Carolina
1932. Orangeburg County, South Carolina
1933. Pickens County, South Carolina
1934. Richland County, South Carolina
1935. Saluda County, South Carolina
1936. Spartanburg County, South Carolina
1937. Summerville Town, South Carolina
1938. Sumter County, South Carolina
1939. Union County, South Carolina
1940. Williamsburg County, South
Carolina
1941. York County, South Carolina
1942. Anderson County, Tennessee
1943. Arlington Town, Tennessee
1944. Bledsoe County, Tennessee
1945. Blount County, Tennessee
1946. Bradley County, Tennessee
1947. Campbell County, Tennessee
1948. Claiborne County, Tennessee
1949. Clay County, Tennessee
1950. Cocke County, Tennessee
1951. Franklin County, Tennessee
1952. Gatlinburg City, Tennessee
1953. Grainger County, Tennessee
1954. Greene County, Tennessee
1955. Grundy County, Tennessee
1956. Hamblen County Board of
Education, Tennessee
1957. Hamilton County, Tennessee
1958. Hancock County Board of
Education, Tennessee
1959. Hawkins County, Tennessee
1960. Jefferson County, Tennessee
1961. Knox County, Tennessee
1962. Knoxville City, Tennessee
1963. Loudon County, Tennessee
1964. Madison County, Tennessee
1965. Marion County, Tennessee
1966. McMinn County, Tennessee
1967. Meigs County, Tennessee
1968. Memphis City, Tennessee
1969. Millington City, Tennessee
1970. Monroe County, Tennessee
1971. Polk County, Tennessee
1972. Rhea County, Tennessee
1973. Roane County, Tennessee
1974. Rutherford County, Tennessee
1975. Rutledge Town, Tennessee
1976. Sequatchie County, Tennessee
1977. Sevier County, Tennessee
1978. Shelby County, Tennessee
WITH TECHNICAL CORRECTIONS 02.03.2023
C-25
1979. Union County, Tennessee
1980. Washington County, Tennessee
1981. Williamson County, Tennessee
1982. Angelina County, Texas
1983. Bailey County, Texas
1984. Bexar County, Texas
1985. Bowie County, Texas
1986. Brazos County, Texas
1987. Camp County, Texas
1988. Cherokee County, Texas
1989. Clay County, Texas
1990. Coryell County, Texas
1991. Dallas County, Texas
1992. Dallas County Hospital District d/b/a
Parkland Health Hospital System,
Texas
1993. Duval County, Texas
1994. Eagle Pass City, Texas
1995. El Campo Memorial Hospital/West
Wharton County Hospital District,
Texas
1996. Ellis County, Texas
1997. Freestone County, Texas
1998. Guadalupe Valley Hospital a/k/a
Guadalupe Regional Medical Center,
Texas
1999. Harris County Hospital District d/b/a
Harris Health System, Texas
2000. Henderson County, Texas
2001. Jim Hogg County, Texas
2002. Jim Wells County, Texas
2003. Johnson County, Texas
2004. Kaufman County, Texas
2005. Kleberg County, Texas
2006. Lamar County, Texas
2007. Laredo City, Texas
2008. Maverick County, Texas
2009. McLennan County, Texas
2010. Montgomery County, Texas
2011. Ochiltree County Hospital District,
Texas
2012. Palo Pinto County Hospital District
a/k/a Palo Pinto General Hospital,
Texas
2013. Polk County, Texas
2014. Rockwall County, Texas
2015. Rusk County, Texas
2016. San Antonio City, Texas
2017. Smith County, Texas
2018. Stephens County, Texas
2019. Tarrant County, Texas
2020. Tarrant County Hospital District
d/b/a JPS Health, Texas
2021. Titus County, Texas
2022. Walker County, Texas
2023. Webb County, Texas
2024. Wichita County, Texas
2025. Williamson County, Texas
2026. Zavala County, Texas
2027. Cache County, Utah
2028. Sevier County, Utah
2029. Summit County, Utah
2030. Tooele County, Utah
2031. Uintah County, Utah
2032. Utah County, Utah
2033. Wasatch County, Utah
2034. Washington County, Utah
2035. Weber County, Utah
2036. Bennington Town, Vermont
2037. St. Albans City, Vermont
2038. Accomack County, Virginia
2039. Alexandria City, Virginia
2040. Alleghany County, Virginia
2041. Amherst County, Virginia
2042. Arlington County, Virginia
2043. Botetourt County, Virginia
2044. Bristol City, Virginia
2045. Buchanan County, Virginia
2046. Buena Vista City, Virginia
2047. Carroll County, Virginia
2048. Charlotte County, Virginia
2049. Chesapeake City, Virginia
2050. Chesterfield County, Virginia
2051. Covington City, Virginia
2052. Culpeper County, Virginia
2053. Cumberland County, Virginia
2054. Danville City, Virginia
2055. Dickenson County, Virginia
2056. Dinwiddie County, Virginia
2057. Emporia City, Virginia
2058. Fairfax City, Virginia
2059. Fairfax County, Virginia
WITH TECHNICAL CORRECTIONS 02.03.2023
C-26
2060. Fauquier County, Virginia
2061. Floyd County, Virginia
2062. Franklin County, Virginia
2063. Frederick County, Virginia
2064. Fredericksburg City, Virginia
2065. Galax City, Virginia
2066. Giles County, Virginia
2067. Goochland County, Virginia
2068. Greensville County, Virginia
2069. Halifax County, Virginia
2070. Henrico County, Virginia
2071. Henry County, Virginia
2072. Hopewell City, Virginia
2073. Isle of Wight County, Virginia
2074. King & Queen County, Virginia
2075. Lee County, Virginia
2076. Lexington City, Virginia
2077. Loudoun County, Virginia
2078. Louisa County, Virginia
2079. Madison County, Virginia
2080. Martinsville City, Virginia
2081. Mecklenburg County, Virginia
2082. Montgomery County, Virginia
2083. Norfolk City, Virginia
2084. Northampton County, Virginia
2085. Northumberland County, Virginia
2086. Norton City, Virginia
2087. Page County, Virginia
2088. Patrick County, Virginia
2089. Pittsylvania County, Virginia
2090. Portsmouth City, Virginia
2091. Prince George County, Virginia
2092. Prince William County, Virginia
2093. Pulaski County, Virginia
2094. Radford City, Virginia
2095. Richmond City, Virginia
2096. Richmond County, Virginia
2097. Roanoke City, Virginia
2098. Roanoke County, Virginia
2099. Rockbridge County, Virginia
2100. Salem City, Virginia
2101. Scott County, Virginia
2102. Shenandoah County, Virginia
2103. Smyth County, Virginia
2104. Stafford County, Virginia
2105. Tazewell County, Virginia
2106. Virginia Beach City, Virginia
2107. Warren County, Virginia
2108. Washington County, Virginia
2109. Waynesboro City, Virginia
2110. Westmoreland County, Virginia
2111. Winchester City, Virginia
2112. Wise County, Virginia
2113. Wythe County, Virginia
2114. Bainbridge Island City, Washington
2115. Chelan County, Washington
2116. Franklin County, Washington
2117. Island County, Washington
2118. Jefferson County, Washington
2119. King County, Washington
2120. Kitsap County, Washington
2121. Lewis County, Washington
2122. Pierce County, Washington
2123. Spokane City, Washington
2124. Spokane County, Washington
2125. Tacoma City, Washington
2126. Thurston County, Washington
2127. Walla Walla County, Washington
2128. Whatcom County, Washington
2129. Adams County, Wisconsin
2130. Ashland County, Wisconsin
2131. Barron County, Wisconsin
2132. Bayfield County, Wisconsin
2133. Brown County, Wisconsin
2134. Buffalo County, Wisconsin
2135. Burnett County, Wisconsin
2136. Calumet County, Wisconsin
2137. Chippewa County, Wisconsin
2138. Clark County, Wisconsin
2139. Columbia County, Wisconsin
2140. Crawford County, Wisconsin
2141. Cudahy City, Wisconsin
2142. Dane County, Wisconsin
2143. Dodge County, Wisconsin
2144. Door County, Wisconsin
2145. Douglas County, Wisconsin
2146. Dunn County, Wisconsin
2147. Eau Claire County, Wisconsin
2148. Florence County, Wisconsin
2149. Fond du Lac County, Wisconsin
2150. Forest County, Wisconsin
2151. Franklin City, Wisconsin
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C-27
2152. Grant County, Wisconsin
2153. Green County, Wisconsin
2154. Green Lake County, Wisconsin
2155. Greenfield City, Wisconsin
2156. Iowa County, Wisconsin
2157. Iron County, Wisconsin
2158. Jackson County, Wisconsin
2159. Jefferson County, Wisconsin
2160. Juneau County, Wisconsin
2161. Kenosha City, Wisconsin
2162. Kenosha County, Wisconsin
2163. Kewaunee County, Wisconsin
2164. La Crosse County, Wisconsin
2165. Lafayette County, Wisconsin
2166. Langlade County, Wisconsin
2167. Lincoln County, Wisconsin
2168. Manitowoc County, Wisconsin
2169. Marathon County, Wisconsin
2170. Marinette City, Wisconsin
2171. Marinette County, Wisconsin
2172. Marquette County, Wisconsin
2173. Menominee County, Wisconsin
2174. Milwaukee City, Wisconsin
2175. Milwaukee County, Wisconsin
2176. Monroe County, Wisconsin
2177. Oak Creek City, Wisconsin
2178. Oconto County, Wisconsin
2179. Oneida County, Wisconsin
2180. Outagamie County, Wisconsin
2181. Ozaukee County, Wisconsin
2182. Pepin County, Wisconsin
2183. Pierce County, Wisconsin
2184. Pleasant Prairie Village, Wisconsin
2185. Portage County, Wisconsin
2186. Price County, Wisconsin
2187. Racine County, Wisconsin
2188. Richland County, Wisconsin
2189. Rock County, Wisconsin
2190. Rusk County, Wisconsin
2191. Sauk County, Wisconsin
2192. Sawyer County, Wisconsin
2193. Shawano County, Wisconsin
2194. Sheboygan County, Wisconsin
2195. South Milwaukee City, Wisconsin
2196. St. Croix County, Wisconsin
2197. Superior City, Wisconsin
2198. Taylor County, Wisconsin
2199. Trempealeau County, Wisconsin
2200. Vernon County, Wisconsin
2201. Vilas County, Wisconsin
2202. Walworth County, Wisconsin
2203. Washburn County, Wisconsin
2204. Washington County, Wisconsin
2205. Waukesha County, Wisconsin
2206. Waupaca County, Wisconsin
2207. Waushara County, Wisconsin
2208. West Allis City, Wisconsin
2209. Winnebago County, Wisconsin
2210. Wood County, Wisconsin
2211. Sheridan City, Wyoming
WITH TECHNICAL CORRECTIONS 02.03.2023
D-1
EXHIBIT D
[Intentionally Omitted]
WITH TECHNICAL CORRECTIONS 02.03.2023
E-1
EXHIBIT E
List of Opioid Remediation Uses
Schedule A
Core Strategies
Settling States and Participating Subdivisions listed on Exhibit G may choose from among the abatement strategies listed in Schedule B. However, priority may be given to the following core abatement strategies (“Core Strategies”).1
A. NALOXONE OR OTHER FDA-APPROVED DRUG TO
REVERSE OPIOID OVERDOSES
1. Expand training for first responders, schools, community support groups and families; and
2. Increase distribution to individuals who are uninsured or whose insurance does not cover the needed service.
B. MEDICATION-ASSISTED TREATMENT (“MAT”)
DISTRIBUTION AND OTHER OPIOID-RELATED
TREATMENT
1. Increase distribution of MAT to individuals who are
uninsured or whose insurance does not cover the needed
service;
2. Provide education to school-based and youth-focused
programs that discourage or prevent misuse;
3. Provide MAT education and awareness training to
healthcare providers, EMTs, law enforcement, and other
first responders; and
4. Provide treatment and recovery support services such as residential and inpatient treatment, intensive outpatient treatment, outpatient therapy or counseling, and recovery housing that allow or integrate medication and with other support services.
1 As used in this Schedule A, words like “expand,” “fund,” “provide” or the like shall not indicate a preference for new or existing programs.
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E-2
C. PREGNANT & POSTPARTUM WOMEN
1. Expand Screening, Brief Intervention, and Referral to Treatment (“SBIRT”) services to non-Medicaid eligible or uninsured pregnant women;
2. Expand comprehensive evidence-based treatment and
recovery services, including MAT, for women with cooccurring Opioid Use Disorder (“OUD”) and other Substance Use Disorder (“SUD”)/Mental Health disorders
for uninsured individuals for up to 12 months postpartum; and
3. Provide comprehensive wrap-around services to individuals with OUD, including housing, transportation, job
placement/training, and childcare.
D. EXPANDING TREATMENT FOR NEONATAL
ABSTINENCE SYNDROME (“NAS”)
1. Expand comprehensive evidence-based and recovery
support for NAS babies;
2. Expand services for better continuum of care with infantneed dyad; and
3. Expand long-term treatment and services for medical
monitoring of NAS babies and their families.
E. EXPANSION OF WARM HAND-OFF PROGRAMS AND
RECOVERY SERVICES
1. Expand services such as navigators and on-call teams to begin MAT in hospital emergency departments;
2. Expand warm hand-off services to transition to recovery services;
3. Broaden scope of recovery services to include co-occurring SUD or mental health conditions;
4. Provide comprehensive wrap-around services to individuals in recovery, including housing, transportation, job
placement/training, and childcare; and
WITH TECHNICAL CORRECTIONS 02.03.2023
E-3
5. Hire additional social workers or other behavioral health workers to facilitate expansions above.
F. TREATMENT FOR INCARCERATED POPULATION
1. Provide evidence-based treatment and recovery support, including MAT for persons with OUD and co-occurring
SUD/MH disorders within and transitioning out of the
criminal justice system; and
2. Increase funding for jails to provide treatment to inmates with OUD.
G. PREVENTION PROGRAMS
1. Funding for media campaigns to prevent opioid use (similar to the FDA’s “Real Cost” campaign to prevent youth from
misusing tobacco);
2. Funding for evidence-based prevention programs in schools;
3. Funding for medical provider education and outreach regarding best prescribing practices for opioids consistent with the CDC guidelines, including providers at hospitals (academic
detailing);
4. Funding for community drug disposal programs; and
5. Funding and training for first responders to participate in prearrest diversion programs, post-overdose response teams, or similar strategies that connect at-risk individuals to behavioral health services and supports.
H. EXPANDING SYRINGE SERVICE PROGRAMS
1. Provide comprehensive syringe services programs with more wrap-around services, including linkage to OUD
treatment, access to sterile syringes and linkage to care and treatment of infectious diseases.
I. EVIDENCE-BASED DATA COLLECTION AND
RESEARCH ANALYZING THE EFFECTIVENESS OF THE
ABATEMENT STRATEGIES WITHIN THE STATE
WITH TECHNICAL CORRECTIONS 02.03.2023
E-4
Schedule B
Approved Uses
Support treatment of Opioid Use Disorder (OUD) and any co-occurring Substance Use Disorder or Mental Health (SUD/MH) conditions through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:
PART ONE: TREATMENT
A. TREAT OPIOID USE DISORDER (OUD)
Support treatment of Opioid Use Disorder (“OUD”) and any co-occurring Substance Use Disorder or Mental Health (“SUD/MH”) conditions through evidence-based or evidenceinformed programs or strategies that may include, but are not limited to, those that:2
1. Expand availability of treatment for OUD and any co-occurring SUD/MH conditions, including all forms of Medication-Assisted Treatment (“MAT”) approved by the U.S.
Food and Drug Administration.
2. Support and reimburse evidence-based services that adhere to the American Society of Addiction Medicine (“ASAM”) continuum of care for OUD and any co-occurring SUD/MH conditions.
3. Expand telehealth to increase access to treatment for OUD and any co-occurring SUD/MH conditions, including MAT, as well as counseling, psychiatric support, and other treatment and recovery support services.
4. Improve oversight of Opioid Treatment Programs (“OTPs”) to assure evidence-based or evidence-informed practices such as adequate methadone dosing and low threshold approaches to treatment.
5. Support mobile intervention, treatment, and recovery services, offered by qualified professionals and service providers, such as peer recovery coaches, for persons with OUD and any co-occurring SUD/MH conditions and for persons who have experienced an opioid overdose.
6. Provide treatment of trauma for individuals with OUD (e.g., violence, sexual assault, human trafficking, or adverse childhood experiences) and family members (e.g., surviving family members after an overdose or overdose fatality), and training of health care personnel to identify and address such trauma. 2 As used in this Schedule B, words like “expand,” “fund,” “provide” or the like shall not indicate a preference for new or existing programs.
WITH TECHNICAL CORRECTIONS 02.03.2023
E-5
7. Support evidence-based withdrawal management services for people with OUD and any co-occurring mental health conditions.
8. Provide training on MAT for health care providers, first responders, students, or other supporting professionals, such as peer recovery coaches or recovery outreach specialists, including telementoring to assist community-based providers in rural or underserved areas.
9. Support workforce development for addiction professionals who work with persons with OUD and any co-occurring SUD/MH conditions.
10. Offer fellowships for addiction medicine specialists for direct patient care, instructors, and clinical research for treatments.
11. Offer scholarships and supports for behavioral health practitioners or workers involved in addressing OUD and any co-occurring SUD/MH or mental health conditions, including, but not limited to, training, scholarships, fellowships, loan repayment programs, or other incentives for providers to work in rural or underserved areas.
12. Provide funding and training for clinicians to obtain a waiver under the federal Drug Addiction Treatment Act of 2000 (“DATA 2000”) to prescribe MAT for OUD, and provide technical assistance and professional support to clinicians who have obtained a DATA 2000 waiver.
13. Disseminate web-based training curricula, such as the American Academy of Addiction Psychiatry’s Provider Clinical Support Service–Opioids web-based training curriculum and motivational interviewing.
14. Develop and disseminate new curricula, such as the American Academy of Addiction Psychiatry’s Provider Clinical Support Service for Medication–Assisted Treatment.
B. SUPPORT PEOPLE IN TREATMENT AND RECOVERY
Support people in recovery from OUD and any co-occurring SUD/MH conditions through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the programs or strategies that:
1. Provide comprehensive wrap-around services to individuals with OUD and any cooccurring SUD/MH conditions, including housing, transportation, education, job placement, job training, or childcare.
2. Provide the full continuum of care of treatment and recovery services for OUD and any co-occurring SUD/MH conditions, including supportive housing, peer support WITH TECHNICAL CORRECTIONS 02.03.2023
E-6
services and counseling, community navigators, case management, and connections to community-based services.
3. Provide counseling, peer-support, recovery case management and residential treatment with access to medications for those who need it to persons with OUD and any co-occurring SUD/MH conditions.
4. Provide access to housing for people with OUD and any co-occurring SUD/MH conditions, including supportive housing, recovery housing, housing assistance programs, training for housing providers, or recovery housing programs that allow or integrate FDA-approved mediation with other support services.
5. Provide community support services, including social and legal services, to assist in deinstitutionalizing persons with OUD and any co-occurring SUD/MH conditions.
6. Support or expand peer-recovery centers, which may include support groups, social events, computer access, or other services for persons with OUD and any cooccurring SUD/MH conditions.
7. Provide or support transportation to treatment or recovery programs or services for persons with OUD and any co-occurring SUD/MH conditions.
8. Provide employment training or educational services for persons in treatment for or recovery from OUD and any co-occurring SUD/MH conditions.
9. Identify successful recovery programs such as physician, pilot, and college recovery programs, and provide support and technical assistance to increase the number and capacity of high-quality programs to help those in recovery.
10. Engage non-profits, faith-based communities, and community coalitions to support people in treatment and recovery and to support family members in their efforts to support the person with OUD in the family.
11. Provide training and development of procedures for government staff to appropriately interact and provide social and other services to individuals with or in recovery from OUD, including reducing stigma.
12. Support stigma reduction efforts regarding treatment and support for persons with OUD, including reducing the stigma on effective treatment.
13. Create or support culturally appropriate services and programs for persons with OUD and any co-occurring SUD/MH conditions, including new Americans.
14. Create and/or support recovery high schools.
WITH TECHNICAL CORRECTIONS 02.03.2023
E-7
15. Hire or train behavioral health workers to provide or expand any of the services or supports listed above.
C. CONNECT PEOPLE WHO NEED HELP TO THE HELP THEY NEED
(CONNECTIONS TO CARE)
Provide connections to care for people who have—or are at risk of developing—OUD and any co-occurring SUD/MH conditions through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, those that:
1. Ensure that health care providers are screening for OUD and other risk factors and know how to appropriately counsel and treat (or refer if necessary) a patient for OUD treatment.
2. Fund SBIRT programs to reduce the transition from use to disorders, including SBIRT services to pregnant women who are uninsured or not eligible for Medicaid.
3. Provide training and long-term implementation of SBIRT in key systems (health, schools, colleges, criminal justice, and probation), with a focus on youth and young adults when transition from misuse to opioid disorder is common.
4. Purchase automated versions of SBIRT and support ongoing costs of the technology.
5. Expand services such as navigators and on-call teams to begin MAT in hospital emergency departments.
6. Provide training for emergency room personnel treating opioid overdose patients on post-discharge planning, including community referrals for MAT, recovery case management or support services.
7. Support hospital programs that transition persons with OUD and any co-occurring SUD/MH conditions, or persons who have experienced an opioid overdose, into clinically appropriate follow-up care through a bridge clinic or similar approach.
8. Support crisis stabilization centers that serve as an alternative to hospital emergency departments for persons with OUD and any co-occurring SUD/MH conditions or persons that have experienced an opioid overdose.
9. Support the work of Emergency Medical Systems, including peer support specialists, to connect individuals to treatment or other appropriate services following an opioid overdose or other opioid-related adverse event.
10. Provide funding for peer support specialists or recovery coaches in emergency departments, detox facilities, recovery centers, recovery housing, or similar settings; offer services, supports, or connections to care to persons with OUD and any co- WITH TECHNICAL CORRECTIONS 02.03.2023
E-8
occurring SUD/MH conditions or to persons who have experienced an opioid overdose.
11. Expand warm hand-off services to transition to recovery services.
12. Create or support school-based contacts that parents can engage with to seek immediate treatment services for their child; and support prevention, intervention, treatment, and recovery programs focused on young people.
13. Develop and support best practices on addressing OUD in the workplace.
14. Support assistance programs for health care providers with OUD.
15. Engage non-profits and the faith community as a system to support outreach for treatment.
16. Support centralized call centers that provide information and connections to appropriate services and supports for persons with OUD and any co-occurring SUD/MH conditions.
D. ADDRESS THE NEEDS OF CRIMINAL JUSTICE-INVOLVED PERSONS Address the needs of persons with OUD and any co-occurring SUD/MH conditions who are involved in, are at risk of becoming involved in, or are transitioning out of the criminal justice system through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, those that:
1. Support pre-arrest or pre-arraignment diversion and deflection strategies for persons with OUD and any co-occurring SUD/MH conditions, including established strategies such as:
1. Self-referral strategies such as the Angel Programs or the Police Assisted Addiction Recovery Initiative (“PAARI”);
2. Active outreach strategies such as the Drug Abuse Response Team (“DART”) model;
3. “Naloxone Plus” strategies, which work to ensure that individuals who have received naloxone to reverse the effects of an overdose are then linked to treatment programs or other appropriate services;
4. Officer prevention strategies, such as the Law Enforcement Assisted Diversion (“LEAD”) model;
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E-9
5. Officer intervention strategies such as the Leon County, Florida Adult Civil Citation Network or the Chicago Westside Narcotics Diversion to Treatment Initiative; or
6. Co-responder and/or alternative responder models to address OUD-related 911 calls with greater SUD expertise.
2. Support pre-trial services that connect individuals with OUD and any co-occurring SUD/MH conditions to evidence-informed treatment, including MAT, and related services.
3. Support treatment and recovery courts that provide evidence-based options for persons with OUD and any co-occurring SUD/MH conditions.
4. Provide evidence-informed treatment, including MAT, recovery support, harm reduction, or other appropriate services to individuals with OUD and any cooccurring SUD/MH conditions who are incarcerated in jail or prison.
5. Provide evidence-informed treatment, including MAT, recovery support, harm reduction, or other appropriate services to individuals with OUD and any cooccurring SUD/MH conditions who are leaving jail or prison or have recently left jail or prison, are on probation or parole, are under community corrections supervision, or are in re-entry programs or facilities.
6. Support critical time interventions (“CTI”), particularly for individuals living with dual-diagnosis OUD/serious mental illness, and services for individuals who face immediate risks and service needs and risks upon release from correctional settings.
7. Provide training on best practices for addressing the needs of criminal justiceinvolved persons with OUD and any co-occurring SUD/MH conditions to law enforcement, correctional, or judicial personnel or to providers of treatment, recovery, harm reduction, case management, or other services offered in connection with any of the strategies described in this section.
E. ADDRESS THE NEEDS OF PREGNANT OR PARENTING WOMEN AND
THEIR FAMILIES, INCLUDING BABIES WITH NEONATAL ABSTINENCE
SYNDROME
Address the needs of pregnant or parenting women with OUD and any co-occurring SUD/MH conditions, and the needs of their families, including babies with neonatal abstinence syndrome (“NAS”), through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, those that:
1. Support evidence-based or evidence-informed treatment, including MAT, recovery services and supports, and prevention services for pregnant women—or women who WITH TECHNICAL CORRECTIONS 02.03.2023
E-10
could become pregnant—who have OUD and any co-occurring SUD/MH conditions, and other measures to educate and provide support to families affected by Neonatal Abstinence Syndrome.
2. Expand comprehensive evidence-based treatment and recovery services, including MAT, for uninsured women with OUD and any co-occurring SUD/MH conditions for up to 12 months postpartum.
3. Provide training for obstetricians or other healthcare personnel who work with pregnant women and their families regarding treatment of OUD and any co-occurring SUD/MH conditions.
4. Expand comprehensive evidence-based treatment and recovery support for NAS babies; expand services for better continuum of care with infant-need dyad; and expand long-term treatment and services for medical monitoring of NAS babies and their families.
5. Provide training to health care providers who work with pregnant or parenting women on best practices for compliance with federal requirements that children born with NAS get referred to appropriate services and receive a plan of safe care.
6. Provide child and family supports for parenting women with OUD and any cooccurring SUD/MH conditions.
7. Provide enhanced family support and child care services for parents with OUD and any co-occurring SUD/MH conditions.
8. Provide enhanced support for children and family members suffering trauma as a result of addiction in the family; and offer trauma-informed behavioral health treatment for adverse childhood events.
9. Offer home-based wrap-around services to persons with OUD and any co-occurring SUD/MH conditions, including, but not limited to, parent skills training.
10. Provide support for Children’s Services—Fund additional positions and services, including supportive housing and other residential services, relating to children being removed from the home and/or placed in foster care due to custodial opioid use.
PART TWO: PREVENTION
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F. PREVENT OVER-PRESCRIBING AND ENSURE APPROPRIATE
PRESCRIBING AND DISPENSING OF OPIOIDS
Support efforts to prevent over-prescribing and ensure appropriate prescribing and dispensing of opioids through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:
1. Funding medical provider education and outreach regarding best prescribing practices for opioids consistent with the Guidelines for Prescribing Opioids for Chronic Pain from the U.S. Centers for Disease Control and Prevention, including providers at hospitals (academic detailing).
2. Training for health care providers regarding safe and responsible opioid prescribing, dosing, and tapering patients off opioids.
3. Continuing Medical Education (CME) on appropriate prescribing of opioids.
4. Providing Support for non-opioid pain treatment alternatives, including training providers to offer or refer to multi-modal, evidence-informed treatment of pain.
5. Supporting enhancements or improvements to Prescription Drug Monitoring Programs (“PDMPs”), including, but not limited to, improvements that:
1. Increase the number of prescribers using PDMPs;
2. Improve point-of-care decision-making by increasing the quantity, quality, or format of data available to prescribers using PDMPs, by improving the interface that prescribers use to access PDMP data, or both; or
3. Enable states to use PDMP data in support of surveillance or intervention strategies, including MAT referrals and follow-up for individuals identified within PDMP data as likely to experience OUD in a manner that complies with all relevant privacy and security laws and rules.
6. Ensuring PDMPs incorporate available overdose/naloxone deployment data, including the United States Department of Transportation’s Emergency Medical Technician overdose database in a manner that complies with all relevant privacy and security laws and rules.
7. Increasing electronic prescribing to prevent diversion or forgery.
8. Educating dispensers on appropriate opioid dispensing.
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G. PREVENT MISUSE OF OPIOIDS
Support efforts to discourage or prevent misuse of opioids through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:
1. Funding media campaigns to prevent opioid misuse.
2. Corrective advertising or affirmative public education campaigns based on evidence.
3. Public education relating to drug disposal.
4. Drug take-back disposal or destruction programs.
5. Funding community anti-drug coalitions that engage in drug prevention efforts.
6. Supporting community coalitions in implementing evidence-informed prevention, such as reduced social access and physical access, stigma reduction—including staffing, educational campaigns, support for people in treatment or recovery, or training of coalitions in evidence-informed implementation, including the Strategic Prevention Framework developed by the U.S. Substance Abuse and Mental Health Services Administration (“SAMHSA”).
7. Engaging non-profits and faith-based communities as systems to support prevention.
8. Funding evidence-based prevention programs in schools or evidence-informed school and community education programs and campaigns for students, families, school employees, school athletic programs, parent-teacher and student associations, and others.
9. School-based or youth-focused programs or strategies that have demonstrated effectiveness in preventing drug misuse and seem likely to be effective in preventing the uptake and use of opioids.
10. Create or support community-based education or intervention services for families, youth, and adolescents at risk for OUD and any co-occurring SUD/MH conditions.
11. Support evidence-informed programs or curricula to address mental health needs of young people who may be at risk of misusing opioids or other drugs, including emotional modulation and resilience skills.
12. Support greater access to mental health services and supports for young people, including services and supports provided by school nurses, behavioral health workers or other school staff, to address mental health needs in young people that (when not properly addressed) increase the risk of opioid or another drug misuse.
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H. PREVENT OVERDOSE DEATHS AND OTHER HARMS (HARM REDUCTION) Support efforts to prevent or reduce overdose deaths or other opioid-related harms through evidence-based or evidence-informed programs or strategies that may include, but are not limited to, the following:
1. Increased availability and distribution of naloxone and other drugs that treat overdoses for first responders, overdose patients, individuals with OUD and their friends and family members, schools, community navigators and outreach workers, persons being released from jail or prison, or other members of the general public.
2. Public health entities providing free naloxone to anyone in the community.
3. Training and education regarding naloxone and other drugs that treat overdoses for first responders, overdose patients, patients taking opioids, families, schools, community support groups, and other members of the general public.
4. Enabling school nurses and other school staff to respond to opioid overdoses, and provide them with naloxone, training, and support.
5. Expanding, improving, or developing data tracking software and applications for overdoses/naloxone revivals.
6. Public education relating to emergency responses to overdoses.
7. Public education relating to immunity and Good Samaritan laws.
8. Educating first responders regarding the existence and operation of immunity and Good Samaritan laws.
9. Syringe service programs and other evidence-informed programs to reduce harms associated with intravenous drug use, including supplies, staffing, space, peer support services, referrals to treatment, fentanyl checking, connections to care, and the full range of harm reduction and treatment services provided by these programs.
10. Expanding access to testing and treatment for infectious diseases such as HIV and Hepatitis C resulting from intravenous opioid use.
11. Supporting mobile units that offer or provide referrals to harm reduction services, treatment, recovery supports, health care, or other appropriate services to persons that use opioids or persons with OUD and any co-occurring SUD/MH conditions.
12. Providing training in harm reduction strategies to health care providers, students, peer recovery coaches, recovery outreach specialists, or other professionals that provide care to persons who use opioids or persons with OUD and any co-occurring SUD/MH conditions.
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13. Supporting screening for fentanyl in routine clinical toxicology testing.
PART THREE: OTHER STRATEGIES
I. FIRST RESPONDERS
In addition to items in section C, D and H relating to first responders, support the following:
1. Education of law enforcement or other first responders regarding appropriate practices and precautions when dealing with fentanyl or other drugs.
2. Provision of wellness and support services for first responders and others who experience secondary trauma associated with opioid-related emergency events.
J. LEADERSHIP, PLANNING AND COORDINATION
Support efforts to provide leadership, planning, coordination, facilitations, training and technical assistance to abate the opioid epidemic through activities, programs, or strategies that may include, but are not limited to, the following:
1. Statewide, regional, local or community regional planning to identify root causes of addiction and overdose, goals for reducing harms related to the opioid epidemic, and areas and populations with the greatest needs for treatment intervention services, and to support training and technical assistance and other strategies to abate the opioid epidemic described in this opioid abatement strategy list.
2. A dashboard to (a) share reports, recommendations, or plans to spend opioid settlement funds; (b) to show how opioid settlement funds have been spent; (c) to report program or strategy outcomes; or (d) to track, share or visualize key opioid- or health-related indicators and supports as identified through collaborative statewide, regional, local or community processes.
3. Invest in infrastructure or staffing at government or not-for-profit agencies to support collaborative, cross-system coordination with the purpose of preventing overprescribing, opioid misuse, or opioid overdoses, treating those with OUD and any co-occurring SUD/MH conditions, supporting them in treatment or recovery, connecting them to care, or implementing other strategies to abate the opioid epidemic described in this opioid abatement strategy list.
4. Provide resources to staff government oversight and management of opioid abatement programs.
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K. TRAINING
In addition to the training referred to throughout this document, support training to abate the opioid epidemic through activities, programs, or strategies that may include, but are not limited to, those that:
1. Provide funding for staff training or networking programs and services to improve the capability of government, community, and not-for-profit entities to abate the opioid crisis.
2. Support infrastructure and staffing for collaborative cross-system coordination to prevent opioid misuse, prevent overdoses, and treat those with OUD and any cooccurring SUD/MH conditions, or implement other strategies to abate the opioid epidemic described in this opioid abatement strategy list (e.g., health care, primary care, pharmacies, PDMPs, etc.).
L. RESEARCH
Support opioid abatement research that may include, but is not limited to, the following:
1. Monitoring, surveillance, data collection and evaluation of programs and strategies described in this opioid abatement strategy list.
2. Research non-opioid treatment of chronic pain.
3. Research on improved service delivery for modalities such as SBIRT that demonstrate promising but mixed results in populations vulnerable to opioid use disorders.
4. Research on novel harm reduction and prevention efforts such as the provision of fentanyl test strips.
5. Research on innovative supply-side enforcement efforts such as improved detection of mail-based delivery of synthetic opioids.
6. Expanded research on swift/certain/fair models to reduce and deter opioid misuse within criminal justice populations that build upon promising approaches used to address other substances (e.g., Hawaii HOPE and Dakota 24/7).
7. Epidemiological surveillance of OUD-related behaviors in critical populations, including individuals entering the criminal justice system, including, but not limited to approaches modeled on the Arrestee Drug Abuse Monitoring (“ADAM”) system.
8. Qualitative and quantitative research regarding public health risks and harm reduction opportunities within illicit drug markets, including surveys of market participants who sell or distribute illicit opioids.
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Geospatial analysis of access barriers to MAT and their association with treatment engagement and treatment outcomes
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F-1
EXHIBIT F
Exhibit F-1: List of States and State Global Allocation Percentage Alabama 1.5958653635%
Alaska 0.2283101787%
American Samoa 0.0171221696%
Arizona 2.3755949882%
Arkansas 0.9322152924%
California 9.9213830698%
Colorado 1.6616291219%
Connecticut 1.2938102647%
Delaware 0.4420285052%
District of Columbia 0.1799774824%
Florida 7.0259134409%
Georgia 2.7882080114%
Guam 0.0480366565%
Hawaii 0.3246488040%
Idaho 0.4919080117%
Illinois 3.3263363702%
Indiana 2.2168933059%
Iowa 0.7419256132%
Kansas 0.7840793410%
Kentucky 1.9963344879%
Louisiana 1.4650905059%
Maine 0.5293231313%
Maryland 2.1106090494%
Massachusetts 2.3035761083%
Michigan 3.4020234989%
Minnesota 1.2972597706%
Mississippi 0.8624327860%
Missouri 2.0056475170%
Montana 0.3125481816%
N. Mariana Islands 0.0167059202%
Nebraska 0.4171546352%
Nevada 1.2017657135%
New Hampshire 0.5784834777%
New Jersey 2.7551354545%
New Mexico 0.7989379794%
New York 5.3903813405%
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F-2
North Carolina 3.2502525994%
North Dakota 0.1700251989%
Ohio 4.3567051408%
Oklahoma 1.5322312508%
Oregon 1.3741405009%
Pennsylvania 4.5882419559%
Puerto Rico 0.7101195950%
Rhode Island 0.4465429178%
South Carolina 1.5393083548%
South Dakota 0.1982071487%
Tennessee 2.6881474977%
Texas 6.2932157196%
Utah 1.1466798699%
Vermont 0.2544890561%
Virgin Islands 0.0315673573%
Virginia 2.2801150757%
Washington 2.3189040182%
West Virginia 1.0567416533%
Wisconsin 1.7582560561%
Wyoming 0.1668134842%
WITH TECHNICAL CORRECTIONS 02.03.2023
F-3
Exhibit F-2: Adjusted Allocation Percentages (to be multiplied by $4,279,160,837) Alabama 1.7662713506%
Alaska 0.2526890657%
American Samoa 0.0189504693%
Arizona 2.6292602523%
Arkansas 1.0317569396%
California 10.9807851434%
Colorado 1.8390573418%
Connecticut 1.4319629061%
Delaware 0.4892281659%
District of Columbia 0.1991954197%
Georgia 3.0859319606%
Guam 0.0531659951%
Hawaii 0.3593146982%
Idaho 0.5444337900%
Illinois 3.6815214914%
Indiana 2.4536124557%
Iowa 0.8211481901%
Kansas 0.8678030794%
Kentucky 2.2095024385%
Louisiana 1.6215323960%
Maine 0.5858440840%
Maryland 2.3359792007%
Massachusetts 2.5495512198%
Michigan 3.7652904672%
Minnesota 1.4357807492%
Mississippi 0.9545230798%
Missouri 2.2198099098%
Montana 0.3459219753%
N. Mariana Islands 0.0184897729%
Nebraska 0.4616982721%
Nevada 1.3300898675%
New Hampshire 0.6402537562%
New Jersey 3.0493279268%
New York 5.1179635833%
North Carolina 3.5973135202%
North Dakota 0.1881804346%
Ohio 4.8219127059%
Oklahoma 1.6958424079%
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F-4
Oregon 1.5208707790%
Pennsylvania 5.0781729473%
Puerto Rico 0.7859459356%
Rhode Island 0.4942246260%
South Carolina 1.7036752028%
South Dakota 0.2193716438%
Tennessee 2.9751870176%
Texas 6.9652032577%
Utah 1.2691219754%
Vermont 0.2816633151%
Virgin Islands 0.0349381095%
Virginia 2.5235850256%
Washington 2.5665158389%
Wisconsin 1.9460020688%
Wyoming 0.1846257740%
WITH TECHNICAL CORRECTIONS 02.03.2023
G-1
EXHIBIT G
Subdivisions Eligible to Receive Direct Allocations from the Subdivision Fund and Default Subdivision Fund Allocation Percentages
The Subdivisions set forth on this Exhibit G are eligible to receive direct allocations from the Subdivision Fund, if such Subdivisions are otherwise eligible to receive such funds under this Agreement. By default, the Subdivisions set forth on this Exhibit G shall include all Subdivisions set forth on Exhibit G of the national opioid settlement agreement dated July 21, 2021 with Janssen Pharmaceuticals, Inc., et al., including all amendments up to the Preliminary Agreement Date of this Agreement. A State may elect to add any additional Subdivisions to this Exhibit G at any time prior to the Initial Subdivision Participation Date.
Immediately upon the effectiveness of any State-Subdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3 (or upon the effectiveness of an amendment to any State-Subdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3) that addresses allocation from the Subdivision Fund, whether before or after the Initial Subdivision Participation Date, this Exhibit G will automatically be amended to reflect the allocation from the Subdivision Fund pursuant to the StateSubdivision Agreement, Allocation Statute, Statutory Trust, or voluntary redistribution allowed by Section V.D.3.
For the avoidance of doubt, inclusion on this Exhibit G shall not create any claim for any amount of the Settlement Fund, and no such amounts shall be allocated or distributed to any Subdivision included herein if such Subdivision does not otherwise meet all requirements to receive any such funds pursuant to the Agreement.
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G-2
State ID Qualifying Subdivision
Consolidated State
Allocation
AL1 Abbeville City, Alabama 0.05373276788371%
AL2 Alabaster City, Alabama 0.50906155914420%
AL3 Albertville City, Alabama 0.30073173498551%
AL4 Alexander City, Alabama 0.31021586558805%
AL5 Anniston City, Alabama 0.80101152336447%
AL6 Arab City, Alabama 0.19249341507944%
AL7 Argo Town, Alabama 0.02394095067075%
AL8 Ashland Town, Alabama 0.03903714157458%
AL9 Ashville City, Alabama 0.01799180180480%
AL10 Athens City, Alabama 0.34982234331958%
AL11 Attalla City, Alabama 0.16452490218524%
AL12 Auburn City, Alabama 0.49379760320342%
AL13 Autauga County, Alabama 0.25196509791885%
AL14 Baldwin County, Alabama 1.47023732753838%
AL15 Barbour County, Alabama 0.07277031699064%
AL235 Bay Minette City, Alabama 0.12614031368064%
AL16 Berry Town, Alabama 0.02060389726110%
AL17 Bessemer City, Alabama 0.58643322270761%
AL18 Bibb County, Alabama 0.32904730429155%
AL19 Birmingham City, Alabama 4.18442675390468%
AL20 Blount County, Alabama 0.74378299576171%
AL21 Boaz City, Alabama 0.16593254403002%
AL22 Brent City, Alabama 0.06233303941215%
AL236 Brewton City, Alabama 0.22130588319049%
AL23 Bridgeport City, Alabama 0.00151300231408%
AL24 Brookwood Town, Alabama 0.00696629136887%
AL25 Brundidge City, Alabama 0.01089862331296%
AL26 Bullock County, Alabama 0.06418709145492%
AL27 Butler County, Alabama 0.05373624201937%
AL28 Butler Town, Alabama 0.08203304449913%
AL29 Calera City, Alabama 0.24319709382201%
AL30 Calhoun County, Alabama 0.73004532177506%
AL31 Camp Hill Town, Alabama 0.00607441256105%
AL32 Carbon Hill City, Alabama 0.09325758719295%
AL33 Cedar Bluff Town, Alabama 0.05726177540570%
AL34 Center Point City, Alabama 0.01073160505284%
AL35 Centre City, Alabama 0.14450358825257%
AL36 Centreville City, Alabama 0.02291656767950%
AL37 Chambers County, Alabama 0.42645541213545%
AL39 Cherokee County, Alabama 0.30474566041478%
AL40 Cherokee Town, Alabama 0.00837480986470%
AL41 Chickasaw City, Alabama 0.08065098787772%
AL237 Childersburg City, Alabama 0.09673766459870%
AL42 Chilton County, Alabama 0.65834253848868%
AL43 Choctaw County, Alabama 0.12575403525127%
AL44 Clanton City, Alabama 0.16879497206515%
AL45 Clarke County, Alabama 0.24012462668797%
AL46 Clay County, Alabama 0.16558350703617%
AL47 Cleburne County, Alabama 0.20515352257755%
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G-3
State ID Qualifying Subdivision
Consolidated State
Allocation
AL48 Cleveland Town, Alabama 0.01274799988344%
AL49 Coffee County, Alabama 0.31178909707642%
AL50 Colbert County, Alabama 0.31838531182613%
AL238 Columbiana City, Alabama 0.05006719760858%
AL51 Conecuh County, Alabama 0.15445396734178%
AL52 Coosa County, Alabama 0.12178647492221%
AL53 Cordova City, Alabama 0.09563175305939%
AL54 Covington County, Alabama 0.45692575726444%
AL55 Crenshaw County, Alabama 0.14376470128801%
AL56 Cullman City, Alabama 0.53795721169973%
AL57 Cullman County, Alabama 0.89679454743357%
AL58 Dadeville City, Alabama 0.02418310117309%
AL59 Dale County, Alabama 0.24320907471975%
AL60 Daleville City, Alabama 0.07752611649176%
AL61 Dallas County, Alabama 0.20683597829357%
AL62 Daphne City, Alabama 0.32129647516618%
AL63 Dauphin Island Town, Alabama 0.04612275489251%
AL64 De Kalb County, Alabama 0.40059258260517%
AL65 Decatur City, Alabama 1.88368966680214%
AL66 Demopolis City, Alabama 0.14633737991542%
AL67 Dora City, Alabama 0.09240281994643%
AL68 Dothan City, Alabama 1.09030734534639%
AL69 Double Springs Town, Alabama 0.08025220905367%
AL70 Douglas Town, Alabama 0.00097275798472%
AL239 East Brewton City, Alabama 0.02656781932074%
AL71 Elmore County, Alabama 0.55644997087924%
AL72 Enterprise City, Alabama 0.33245406769430%
AL73 Escambia County, Alabama 0.65163401499834%
AL74 Etowah County, Alabama 1.02826912043695%
AL75 Eufaula City, Alabama 0.21259346526420%
AL76 Evergreen City, Alabama 0.04145059439568%
AL77 Fairfield City, Alabama 0.11699106378085%
AL78 Fairhope City, Alabama 0.22328055592462%
AL79 Faunsdale Town, Alabama 0.00027565805375%
AL80 Fayette City, Alabama 0.07882554063416%
AL81 Fayette County, Alabama 0.13876915395782%
AL82 Florence City, Alabama 0.89173419286246%
AL83 Foley City, Alabama 0.34393082614331%
AL84 Fort Deposit Town, Alabama 0.00516071488254%
AL85 Fort Payne City, Alabama 0.58210250156216%
AL86 Franklin County, Alabama 0.28807497174883%
AL87 Fultondale City, Alabama 0.09530547652440%
AL88 Gadsden City, Alabama 0.83652189774753%
AL90 Geneva City, Alabama 0.06639031036577%
AL91 Geneva County, Alabama 0.22068995465343%
AL92 Georgiana Town, Alabama 0.01833389052733%
AL93 Geraldine Town, Alabama 0.01101187364176%
AL94 Gilbertown, Alabama 0.00201561558522%
AL95 Grant Town, Alabama 0.01702349201247%
WITH TECHNICAL CORRECTIONS 02.03.2023
G-4
State ID Qualifying Subdivision
Consolidated State
Allocation
AL96 Graysville City, Alabama 0.03683772148497%
AL97 Greene County, Alabama 0.07053609060731%
AL98 Greensboro City, Alabama 0.02495617752877%
AL99 Greenville City, Alabama 0.17114173446901%
AL100 Guin City, Alabama 0.02535375501618%
AL101 Gulf Shores City, Alabama 0.48785192847313%
AL102 Guntersville City, Alabama 0.25418471345127%
AL103 Gurley Town, Alabama 0.00751669835675%
AL104 Hale County, Alabama 0.13189455379552%
AL105 Haleyville City, Alabama 0.14259976191105%
AL106 Hamilton City, Alabama 0.09032285168011%
AL107 Hammondville Town, Alabama 0.00490310934680%
AL108 Hartselle City, Alabama 0.06358502699195%
AL109 Headland City, Alabama 0.06278880055472%
AL110 Helena City, Alabama 0.13940462856652%
AL111 Henagar City, Alabama 0.03432173295908%
AL112 Henry County, Alabama 0.08134656178648%
AL113 Homewood City, Alabama 0.40003759755067%
AL114 Hoover City, Alabama 1.41830120728766%
AL115 Houston County, Alabama 0.55870611353893%
AL116 Hueytown City, Alabama 0.19444760015375%
AL117 Huntsville City, Alabama 3.18917672789720%
AL118 Irondale City, Alabama 0.17364096921920%
AL119 Jackson County, Alabama 0.15808077015917%
AL120 Jacksonville City, Alabama 0.25009708439633%
AL121 Jasper City, Alabama 1.40982301753567%
AL122 Jefferson County, Alabama 5.50780373047089%
AL123 Killen Town, Alabama 0.01833161772830%
AL124 Lamar County, Alabama 0.16280419850840%
AL125 Lanett City, Alabama 0.12800105424627%
AL126 Lauderdale County, Alabama 0.47859088932963%
AL127 Lawrence County, Alabama 0.45357831391636%
AL129 Leeds City, Alabama 0.14992359703585%
AL130 Leesburg Town, Alabama 0.01918722915732%
AL131 Leighton Town, Alabama 0.00564699646923%
AL132 Level Plains Town, Alabama 0.00350595484612%
AL133 Limestone County, Alabama 0.58188759217962%
AL134 Lincoln City, Alabama 0.18466222627409%
AL135 Linden City, Alabama 0.01718012033418%
AL136 Locust Fork Town, Alabama 0.00390814286871%
AL137 Louisville Town, Alabama 0.00463180207977%
AL138 Lowndes County, Alabama 0.06941452922326%
AL240 Loxley Town, Alabama 0.04113340905681%
AL139 Luverne City, Alabama 0.01532252921863%
AL140 Macon County, Alabama 0.13647706860490%
AL141 Madison City, Alabama 0.47088048355844%
AL142 Madison County, Alabama 1.31238390221929%
AL143 Marengo County, Alabama 0.04980089049941%
AL144 Marion City, Alabama 0.02355243191090%
WITH TECHNICAL CORRECTIONS 02.03.2023
G-5
State ID Qualifying Subdivision
Consolidated State
Allocation
AL145 Marion County, Alabama 0.22296850061784%
AL146 Marshall County, Alabama 0.74162828487587%
AL147 McKenzie Town, Alabama 0.00440552870209%
AL148 Midfield City, Alabama 0.00038923306812%
AL149 Millbrook City, Alabama 0.24754158163587%
AL150 Mobile City, Alabama 3.22757190115156%
AL151 Mobile County, Alabama 2.76021701591658%
AL152 Monroe County, Alabama 0.18825776187055%
AL153 Monroeville City, Alabama 0.10619523592115%
AL154 Montgomery City, Alabama 1.77726471583620%
AL155 Montgomery County, Alabama 0.98033322388421%
AL156 Moody City, Alabama 0.03620711715990%
AL157 Morgan County, Alabama 0.31373818458719%
AL158 Moulton City, Alabama 0.13546080275305%
AL159 Mountain Brook City, Alabama 0.35653362663731%
AL160 Munford Town, Alabama 0.02417891272917%
AL161 Muscle Shoals City, Alabama 0.26828019094231%
AL162 Nauvoo Town, Alabama 0.01870510354600%
AL163 New Hope City, Alabama 0.01307908176496%
AL164 Northport City, Alabama 0.42416628142128%
AL165 Oakman Town, Alabama 0.04189836827309%
AL166 Oneonta City, Alabama 0.27040610221760%
AL167 Opelika City, Alabama 0.53658372677752%
AL168 Opp City, Alabama 0.09265286030826%
AL169 Orange Beach City, Alabama 0.29416707967375%
AL170 Oxford City, Alabama 0.35237875519965%
AL171 Ozark City, Alabama 0.29499421617778%
AL172 Parrish Town, Alabama 0.11686245582433%
AL173 Pelham City, Alabama 0.68738196181712%
AL174 Pell City, Alabama 0.44443071991301%
AL175 Perry County, Alabama 0.05087894401632%
AL176 Phenix City, Alabama 0.62594382078864%
AL177 Pickens County, Alabama 0.28661898422184%
AL178 Piedmont City, Alabama 0.14348703018370%
AL179 Pike County, Alabama 0.02971580831969%
AL181 Pleasant Grove City, Alabama 0.05168400190121%
AL182 Powell Town, Alabama 0.00530497268382%
AL183 Prattville City, Alabama 0.60331346344410%
AL184 Priceville Town, Alabama 0.01217687795583%
AL185 Prichard City, Alabama 0.11003827933194%
AL186 Ragland Town, Alabama 0.01519801230036%
AL187 Rainbow City, Alabama 0.13460113275434%
AL188 Rainsville City, Alabama 0.18816655769234%
AL189 Randolph County, Alabama 0.17748105799125%
AL190 Red Bay City, Alabama 0.06274639661854%
AL241 Roanoke City, Alabama 0.10908084650639%
AL191 Robertsdale City, Alabama 0.08564458709446%
AL192 Rockford Town, Alabama 0.00588596505293%
AL193 Russell County, Alabama 0.17037596353878%
WITH TECHNICAL CORRECTIONS 02.03.2023
G-6
State ID Qualifying Subdivision
Consolidated State
Allocation
AL194 Russellville City, Alabama 0.31690084937415%
AL195 Saraland City, Alabama 0.24847953332688%
AL196 Satsuma City, Alabama 0.06260301546832%
AL197 Scottsboro City, Alabama 0.66355520306333%
AL198 Selma City, Alabama 0.26395099581907%
AL271 Semmes City, Alabama 0.04200467033057%
AL199 Sheffield City, Alabama 0.16093939937308%
AL200 Shelby County, Alabama 1.63752907032528%
AL201 Sipsey Town, Alabama 0.03758758282199%
AL202 Slocomb City, Alabama 0.04424009805052%
AL203 Spanish Fort City, Alabama 0.02939683721014%
AL204 Springville City, Alabama 0.05781214992503%
AL205 St Clair County, Alabama 1.03787114437202%
AL206 Sumiton City, Alabama 0.23258714845438%
AL242 Summerdale Town, Alabama 0.02450324115071%
AL207 Sumter County, Alabama 0.11813782076557%
AL208 Sweet Water Town, Alabama 0.00030000947192%
AL209 Sylacauga City, Alabama 0.23084021018303%
AL210 Talladega City, Alabama 0.22820288665750%
AL211 Talladega County, Alabama 0.51585677368324%
AL212 Tallapoosa County, Alabama 0.19470098477700%
AL213 Tarrant City, Alabama 0.09199699544540%
AL214 Thomasville City, Alabama 0.08852500271049%
AL215 Troy City, Alabama 0.32823721378024%
AL216 Trussville City, Alabama 0.24448154995938%
AL217 Tuscaloosa City, Alabama 1.95122494838196%
AL218 Tuscaloosa County, Alabama 1.01248511560961%
AL219 Tuscumbia City, Alabama 0.08432211027618%
AL220 Tuskegee City, Alabama 0.09179124219610%
AL221 Union Springs City, Alabama 0.04230906305776%
AL222 Uniontown, Alabama 0.01814515080219%
AL223 Vance Town, Alabama 0.00962932999198%
AL224 Vernon City, Alabama 0.03170902060019%
AL225 Vestavia Hills City, Alabama 0.30835957321481%
AL226 Walker County, Alabama 1.46359656592768%
AL227 Washington County, Alabama 0.16134379525758%
AL228 Weaver City, Alabama 0.04227639968885%
AL229 West Blocton Town, Alabama 0.04044773805810%
AL243 Wetumpka City, Alabama 0.16601095559654%
AL230 Wilcox County, Alabama 0.08791066513276%
AL231 Winfield City, Alabama 0.19023873350485%
AL233 Woodville Town, Alabama 0.00046128079736%
AL234 Yellow Bluff Town, Alabama 0.00293074188026%
AL243 Attentus Mouton, LLC d/b/a
Lawrence Medical Center
(Lawrence County Health Care
Authority), Alabama
0.14143420563150%
WITH TECHNICAL CORRECTIONS 02.03.2023
G-7
State ID Qualifying Subdivision
Consolidated State
Allocation
AL244 Bibb County Healthcare Authority
d/b/a Bibb Medical Center,
Alabama