HomeMy WebLinkAbout25N234 - PURDUE & THE SACKLER FAMILYDocusign Envelope ID: B1989F9E-FFFB-4COE-8DE3-5767DA3F4316
New National Opioids Settlement: Purdue
Opioids Implementation Administrator
opioidsparticipationCcDrubris. com
Palm Springs city, CA
Reference Number: CL-1731146
TO LOCAL POLITICAL SUBDIVISIONS;
THIS PACKAGE CONTAINS DOCUMENTATION TO PARTICIPATE IN THE NEW
NATIONAL OPIOIDS SETTLEMENT. YOU MUST TAKE ACTION IN ORDER TO
PARTICIPATE.
Deadline: September 30, 2025
A new proposed national opioids settlement has been reached with Purdue (and
certain of its affiliates) and the Sackler family. This Participation Package is a follow-
up communication to the Notice of New National Opioids Settlement recently received
electronically by your subdivision.
The proposed settlement is being implemented in connection with Purdue's
bankruptcy proceedings, and consists of, among other things, a settlement of
Purdue's claims against the Sacklers and certain other parties (referred to as the
"Purdue Estate Settlement"), and settlements of direct claims against the Sacklers
held by States, local governments and other creditors (collectively, the "Purdue Direct
Settlement", and together with the Estate Settlement, the "Purdue Settlement"). The
Purdue Direct Settlement for States and local governments is documented in the
Governmental Entity and Shareholder Direct Settlement Agreement.
You are receiving this Participation Package because all eligible States and territories,
including California, are participating in the Purdue Direct Settlement.
This electronic envelope contains:
The Participation Form for the Purdue Direct Settlement, including a release of
any claims; and
The Proposed California State -Subdivision Agreement Regarding Distribution
and Use of Settlement Funds - Purdue/Sackler Settlement ("California State -
Subdivision Agreement"), which governs the allocation, distribution, and use of
abatement funds from the Purdue Settlement paid to California.
The Participation Form and California State -Subdivision Agreement must be
executed, without alteration, and submitted on or before September 30,
2025, in order for your subdivision to be considered for initial participation
calculations and payment eligibility under the Purdue Direct Settlement.
Based upon subdivision participation forms received on or before September 30,
2025, the subdivision participation rate will be used to determine whether
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participation is sufficient for the Purdue Settlement to move forward and whether a
state earns its maximum potential payment under the Purdue Direct Settlement. If
the Purdue Settlement moves forward and goes effective, your release will become
effective. If the Purdue Settlement does not move forward, that release will not
become effective.
Any subdivision that does not participate in the Purdue Direct Settlement cannot
directly share in the Purdue Direct Settlement funds, even if other subdivisions in the
state are participating and sharing in those Purdue Direct Settlement funds. Any
subdivision that does not participate may also reduce the amount of money for
programs to remediate the opioid crisis in its state. Please note, a subdivision will not
necessarily directly receive Purdue Settlement funds by participating; decisions on
how Purdue Settlement funds will be allocated within a state are subject to intrastate
agreements or state statutes.
You are encouraged to discuss the terms and benefits of the Purdue Settlement with
your counsel, your Attorney General's Office, and other contacts within your state.
The State of California, along with a group of cities and counties, negotiated the
California State -Subdivision Agreement, which governs the allocation, distribution,
and use of abatement funds from the Purdue Settlement paid to California. The
allocation of abatement funds will be similar to the allocation in the prior opioids
settlements, where the vast majority (85%) of abatement funds is expected to go to
local governments.
Information and documents regarding the Purdue Settlement, including a complete
copy of the Governmental Entity and Shareholder Direct Settlement Agreement, and
how it is being implemented in your state and how funds will be allocated within your
state can be found on the national settlement website at
https://nationalopioidsettlement.com/purdue-sacklers-settlements/. This website
will be supplemented as additional documents are created.
How to return signed forms:
There are three methods for returning the executed Participation Form and any
supporting documentation to the Implementation Administrator:
(1)Electronic Signature via DocuSign: Executing the Participation Form and
California State -Subdivision Agreement electronically through DocuSign will
return the signed form and agreement to the Implementation Administrator
and associate your form and agreement with your subdivision's records.
Electronic signature is the most efficient method for returning the Participation
Form and California State -Subdivision Agreement, allowing for more timely
participation and the potential to meet higher settlement payment thresholds,
and is therefore strongly encouraged.
(2)Manual Signature returned via DocuSign: DocuSign allows forms to be
downloaded, signed manually, then uploaded to DocuSign and returned
automatically to the Implementation Administrator. Please be sure to complete
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all fields. As with electronic signature, returning a manually signed
Participation Form and California State -Subdivision Agreement via DocuSign
will associate your signed form and agreement with your subdivision's records.
(3)Manual Signature returned via electronic mail: If your subdivision is unable tc
return an executed Participation Form and California State -Subdivision
Agreement using DocuSign, the signed Participation Form and California State -
Subdivision Agreement may be returned via electronic mail to
opioidsparticipation@rubris.com. Please include the name, state, and
reference ID of your subdivision in the body of the email and use the subject
line Settlement Participation Form - [Subdivision Name, Subdivision State] -
[Reference ID].
Detailed instructions on how to sign and return the Participation Form and California
State -Subdivision Agreement, including changing the authorized signer, can be found
at https://nationalopioidsettlement.com/purdue-sacklers-settlements/. You may also
contact opioidsparticipation@rubris.com.
YOU MUST PARTICIPATE IN THE PURDUE DIRECT SETTLEMENT BY
RETURNING YOUR PARTICIPATION FORM AND CALIFORNIA STATE -
SUBDIVISION AGREEMENT IN ORDER TO RECEIVE THE BENEFITS OF THE
PURDUE SETTLEMENT.
Please note that this is NOT a solicitation or a request for subdivisions to
submit votes on the Purdue bankruptcy plan. This settlement package only
pertains to a decision to participate in the Purdue Direct Settlement. If you
receive a package to vote on the plan you should follow the applicable
instructions for voting. PLEASE NOTE THAT VOTING ON THE PLAN IS
SEPARATE FROM PARTICIPATION IN THE PURDUE DIRECT SETTLEMENT.
The sign -on period for subdivisions ends on September 30, 2025.
If you have any questions about executing the Participation Form, please contact
your counsel, the Implementation Administrator at
opioidsparticipation@rubris.com, or the California Attorney General's Office at
opioidsettlement-localgovernment@doj.ca.gov.
Thank you,
Implementation Administrator for the Purdue Direct Settlement
The Implementation Administrator is retained to provide the settlement notice
required by the Purdue Direct Settlement to manage the collection of the participation
forms for it.
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EXHIBIT K
Subdivision Participation and Release Form
Governmental Entity: Palm Springs city
State: CA
Authorized Signatory: scott c sti 1 es
Address1: 3200 E. Tahquitz Canyon way
Address 2:
City, State, Zip: Palm springs Cal i forni a 92263-2743
Phone: 7603228350
Email: scott.stiles@palmspringsca.gov
The governmental entity identified above ("Governmental Entity"), in order to obtain and
in consideration for the benefits provided to the Governmental Entity pursuant to that certain
Governmental Entity & Shareholder Direct Settlement Agreement accompanying this
participation form (the "Agreement")', and acting through the undersigned authorized official,
hereby elects to participate in the Agreement, grant the releases set forth below, and agrees as
follows.
1. The Governmental Entity is aware of and has reviewed the Agreement, and agrees that by
executing this Participation and Release Form, the Governmental Entity elects to
participate in the Agreement and become a Participating Subdivision as provided therein.
2. The Governmental Entity shall promptly after the Effective Date, and prior to the filing of
the Consent Judgment, dismiss with prejudice any Shareholder Released Claims and
Released Claims that it has filed. With respect to any Shareholder Released Claims and
Released Claims pending in In re National Prescription Opiate Litigation, MDL No. 2804,
the Governmental Entity authorizes the Plaintiffs' Executive Committee to execute and file
on behalf of the Governmental Entity a Stipulation of Dismissal with Prejudice
substantially in the form found at https:Hnationalopioidsettlement.com.
3. The Governmental Entity agrees to the terms of the Agreement pertaining to Participating
Subdivisions as defined therein.
4. By agreeing to the terms of the Agreement and becoming a Releasor, the Governmental
Entity is entitled to the benefits provided therein, including, if applicable, monetary
payments beginning following the Effective Date.
5. The Governmental Entity agrees to use any monies it receives through the Agreement
solely for the purposes provided therein.
6. The Governmental Entity submits to the jurisdiction of the court in the Governmental
Entity's state where the Consent Judgment is filed for purposes limited to that court's role
as and to the extent provided in, and for resolving disputes to the extent provided in, the
' Capitalized terms used in this Exhibit K but not otherwise defined in this Exhibit K have the meanings given to
them in the Agreement or, if not defined in the Agreement, the Master Settlement Agreement.
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Agreement. The Governmental Entity likewise agrees to arbitrate before the National
Arbitration Panel as provided in, and for resolving disputes to the extent otherwise
provided in, the Agreement.
7. The Governmental Entity has the right to enforce the Agreement as provided therein.
The Governmental Entity, as a Participating Subdivision, hereby becomes a Releasor for all
purposes in the Agreement, including without limitation all provisions of Article 10
(Release), and along with all departments, agencies, divisions, boards, commissions,
districts, instrumentalities of any kind and attorneys, and any person in his or her 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, and any other entity identified
in the definition of Subdivision Releasor, to the maximum extent of its authority, for good
and valuable consideration, the adequacy of which is hereby confirmed, the Shareholder
Released Parties and Released Parties are, as of the Effective Date, hereby released and
forever discharged by the Governmental Entity and its Subdivision Releasors from: any
and all Causes of Action, including, without limitation, any Estate Cause of Action and any
claims that the Governmental Entity or its Subdivision Releasors would have presently or
in the future been legally entitled to assert in its own right (whether individually or
collectively), notwithstanding section 1542 of the California Civil Code or any law of any
jurisdiction that is similar, comparable or equivalent thereto (which shall conclusively be
deemed waived), whether existing or hereinafter arising, in each case, (A) directly or
indirectly based on, arising out of, or in any way relating to or concerning, in whole or in
part, (i) the Debtors, as such Entities existed prior to or after the Petition Date, and their
Affiliates, (ii) the Estates, (iii) the Chapter 11 Cases, or (iv) Covered Conduct and (B) as to
which any conduct, omission or liability of any Debtor or any Estate is the legal cause or is
otherwise a legally relevant factor (each such release, as it pertains to the Shareholder
Released Parties, the "Shareholder Released Claims", and as it pertains to the Released
Parties other than the Shareholder Released Parties, the "Released Claims"). For the
avoidance of doubt and without limiting the foregoing: the Shareholder Released Claims
and Released Claims include any Cause of Action that has been or may be asserted against
any Shareholder Released Party or Released Party by the Governmental Entity or its
Subdivision Releasors (whether or not such party has brought such action or proceeding) in
any federal, state, or local action or proceeding (whether judicial, arbitral, or
administrative) (A) directly or indirectly based on, arising out of, or in any way relating to
or concerning, in whole or in part, (i) the Debtors, as such Entities existed prior to or after
the Petition Date, and their Affiliates, (ii) the Estates, (iii) the Chapter 11 Cases, or (iv)
Covered Conduct and (B) as to which any conduct, omission or liability of any Debtor or
any Estate is the legal cause or is otherwise a legally relevant factor.
9. As a Releasor, the Governmental Entity hereby absolutely, unconditionally, and
irrevocably covenants not to bring, file, or claim, or to cause, assist or permit to be brought,
filed, or claimed, or to otherwise seek to establish liability for any Shareholder Released
Claims or Released Claims against any Shareholder Released Party or Released Party in
any forum whatsoever, subject in all respects to Section 9.02 of the Master Settlement
Agreement. The releases provided for herein (including the term "Shareholder Released
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Claims" and "Released Claims") are intended by the Governmental Entity and its
Subdivision Releasors to be broad and shall be interpreted so as to give the Shareholder
Released Parties and Released Parties the broadest possible release of any liability relating
in any way to Shareholder Released Claims and Released Claims and extend to the full
extent of the power of the Governmental Entity to release claims. The Agreement shall be a
complete bar to any Shareholder Released Claim and Released Claims.
10. To the maximum extent of the Governmental Entity's power, the Shareholder Released
Parties and the Released Parties are, as of the Effective Date, hereby released and
discharged from any and all Shareholder Released Claims and Released Claims of the
Subdivision Releasors.
11. The Governmental Entity hereby takes on all rights and obligations of a Participating
Subdivision as set forth in the Agreement.
12. In connection with the releases provided for in the Agreement, each Governmental Entity
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 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 Shareholder Released Claims or such
other Claims released pursuant to this release, but each Governmental Entity hereby
expressly waives and fully, finally, and forever settles, releases and discharges, upon the
Effective Date, any and all Shareholder Released Claims or such other Claims released
pursuant to this release that may exist as of such date but which Releasors do not know or
suspect to exist, whether through ignorance, oversight, error, negligence or through no fault
whatsoever, and which, if known, would materially affect the Governmental Entities'
decision to participate in the Agreement.
13. Nothing herein is intended to modify in any way the terms of the Agreement, to which
Governmental Entity hereby agrees. To the extent any portion of this Participation and
Release Form not relating to the release of, or bar against, liability is interpreted differently
from the Agreement in any respect, the Agreement controls.
14. Notwithstanding anything to the contrary herein or in the Agreement, (x) nothing herein
shall (A) release any Excluded Claims or (B) be construed to impair in any way the rights
and obligations of any Person under the Agreement; and (y) the Releases set forth herein
shall be subject to being deemed void to the extent set forth in Section 9.02 of the Master
Settlement Agreement.
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I have all necessary power and authorization to execute this Participation and Release Form
on behalf of the Governmental Entity.
DocuSigned by:
Off WLS
Signature:
Name: Scott Stiles
Title: city Manager
Date: 7/28/202 5
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Proposed California State -Subdivision Agreement
Regarding Distribution and Use of Settlement Funds
Purdue/Sackler Settlement
1. Introduction
The State of California` and certain of its cities and counties have reached this proposed
agreement (the "California Purdue/Sackler State -Subdivision Agreement" or the "Agreement")
to govern the payments made to California in In re: Purdue Pharma L.P., et al, Case No. 19-
23649, pending in the United States Bankruptcy Court, Southern District of New York (the
"Purdue Bankruptcy Matter") and pursuant to the related settlement with the Sacklers.
This Agreement is proposed to govern the allocation, distribution, and use of payments,
including the Statewide Payment Amounts, consisting of Base Payments and Incentive
Payments, and Estate Distributions, paid to California pursuant to the Governmental Entity &
Shareholder Direct Settlement Agreement ("GESA"), the Master Settlement Agreement
("MSA"), the Thirteenth Amended Joint Chapter 11 Plan of Reorganization of Purdue Pharma
L.P. and its Affiliated Debtors (the "Plan"), and the Governmental Remediation Trust Agreement
("GRTA"), and any revisions thereto (collectively, the "Governing Documents"), filed in the
Purdue Bankruptcy Matter.
For the avoidance of doubt, this Agreement does not apply to payments of attorneys' fees and
costs made to California, including any payments to California from the Local Government
Costs and Expenses Fund and the State Expenses Fund and payments pursuant to Sections
9.01, 9.02, and 9.03 and Exhibit R of the GESA and Sections 5.9(a) and 5.9(b) of the Plan,
unless otherwise noted.
Pursuant to Exhibit O, paragraph 4, of the GESA, acceptance of this California State -Subdivision
Agreement is a requirement to be an Initial Participating Subdivision.
2. Definitions
a) CA Participating Subdivision means a General Purpose Government that is a
Participating Subdivision and also (a) a Plaintiff Subdivision; (b) a Primary
Subdivision; and/or (c) a Non -Litigating Threshold Subdivision. For the avoidance of
doubt, eligible CA Participating Subdivisions are those California Subdivisions listed
in Exhibits C (excluding Litigating Special Districts), I, and/or W to the GESA.
b) CA Litigating Special District means a Litigating Special District located in
California. For the avoidance of doubt, CA Litigating Special District does not
include School Districts and certain Health and Hospital Special Districts that fall
under a separate creditor group in the Purdue Bankruptcy Plan.
' For purposes of clarity, use of the term "California" refers to the geographic territory of
California and the state and its local governments therein. The term "State" or "State of
California" refers to the State of California as a governmental unit.
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c) Plaintiff Subdivision means a Subdivision located in California, other than a CA
Litigating Special District, that filed a lawsuit, on behalf of the Subdivision and/or
through an official of the Subdivision on behalf of the People of the State of
California, against one or more Opioid Defendants prior to October 1, 2020.
d) Opioid Defendant means any defendant (including but not limited to Alvogen, Inc.
Amneal Pharmaceuticals LLC; Apotex Corp., Hikma Pharmaceuticals USA Inc. f/k/a
West -Ward Pharmaceuticals Corp.; Indivior Inc.; Viatris Inc. a/k/a Mylan N.V.; Sun
Pharmaceutical Industries, Inc.; Zydus Pharmaceuticals (USA) Inc.; Kroger Co., Teva
Pharmaceutical Industries Ltd., Allergan Finance, LLC, Allergan Limited, CVS
Health Corporation, CVS Pharmacy, Inc., Walgreen Co., Walmart Inc., Johnson &
Johnson, Janssen Pharmaceuticals, Inc., Purdue Pharma L.P., Cardinal Health, Inc.,
Cencora, Inc. f/k/a AmerisourceBergen Corporation, McKesson Corporation, Dr.
Richard S. Sackler, Beverly Sackler, Jonathan Sackler, David Sackler, Marianna
Sackler, Theresa Sackler, Ilene Sackler Lefcourt, Dr. Kathe Sackler, and Mortimer
D.A. Sackler) named in a lawsuit seeking damages, abatement, or other remedies
related to or caused by the opioid public health crisis in any lawsuit brought by any
state or local government on or before October 1, 2020.
3. General Terms
This Agreement is subject to the requirements of the Governing Documents, as well as
applicable law, and the Governing Documents govern over any inconsistent provision of this
California Purdue/Sackler State -Subdivision Agreement. Terms not otherwise defined herein
shall have the same meaning as in the Governing Documents.
All payments made to the State of California and CA Participating Subdivisions subject to this
Agreement will be used for Opioid Remediation, except as allowed by Section 5.02(b) of the
GESA and Section 4.01(f)(ii) of the MSA.
This Agreement does not apply to funds received by California for attorneys' fees and cost,
including payments from the Local Government Costs and Expenses Fund or the State Expenses
Fund, unless otherwise noted.
4. State Allocation
Funds allocated to California shall be combined pursuant to this Agreement, and 15% of that
total shall be allocated to the State of California (the "State of California Allocation"), 70% to
the California Abatement Accounts Fund ("CA Abatement Accounts Fund"), and 15% to the
California Subdivision Fund ("CA Subdivision Fund").
A. State of California Allocation
Fifteen percent of the payments to California subject to this Agreement will be allocated to the
State and used by the State for future Opioid Remediation.
i
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B. CA Abatement Accounts Fund
i. Allocation of CA Abatement Accounts Funds
a) Seventy percent of the payments to California subject to this Agreement will be allocated
to the CA Abatement Accounts Fund. The funds in the CA Abatement Accounts Fund
will be allocated based on the allocation model developed in connection with the
proposed negotiating class in the National Prescription Opiate Litigation (MDL No.
2804), as adjusted to reflect only those cities and counties that are eligible, based on
population or litigation status, to become a CA Participating Subdivision. The percentage
from the CA Abatement Accounts Fund allocated to each CA Participating Subdivision is
set forth in Appendix 1 in the column entitled abatement percentage (the "Local
Allocation"). For the avoidance of doubt, CA Litigating Special Districts and California
towns, cities, and counties with a population less than 10,000 (except those that are
Plaintiff Subdivisions) are not eligible to receive an allocation of CA Abatement
Accounts Funds.
b) A CA Participating Subdivision that is a county, or a city and county, will be allocated its
Local Allocation share as of the date on which it becomes a Participating Subdivision,
and will receive payments as provided in the Governing Documents and this Agreement.
c) A CA Participating Subdivision that is a city will be allocated its Local Allocation share
as of the date on which it becomes a Participating Subdivision. The Local Allocation
share for a city that is a CA Participating Subdivision will be paid to the county in which
the city is located, rather than to the city, so long as the county is a CA Participating
Subdivision; provided, however, that if a city currently receives direct payment of its
share of funds in the National Opioids Settlement with Distributors Cencora, Inc. (f/k/a
AmerisourceBergenCorporation), Cardinal Health, Inc., and McKesson Corporation (the
"Distributors Settlement"), that city's Local Allocation amount will be paid directly to
the city. A Local Allocation share allocated to a city but paid to a county is not required
to be spent exclusively for abatement activities in that city, but will become part of the
county's share of the CA Abatement Accounts Funds, which will be used in accordance
with Section 4.B.ii (Use of CA Abatement Accounts Funds).
d) A city within a county that is a CA Participating Subdivision may opt in or out of direct
payment at any time, and it may also elect direct payment of only a portion of its share,
with the remainder going to the county, by providing notice to the Settlement
Administrator at least 60 days prior to a Payment Date.
e) The State will receive the Local Allocation share of any payment that is attributable to a
county or city that is eligible to become a CA Participating Subdivision, but has not, for a
particular payment, become a Participating Subdivision.
f) Funds received by a CA Participating Subdivision, and not expended or encumbered
within five years of receipt and in accordance with the Governing Documents and this
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Agreement shall be transferred to the State; provided however, that CA Participating
Subdivisions have seven years to expend or encumber CA Abatement Accounts Funds
designated to support capital outlay projects before they must be transferred to the State.
ii. Use of CA Abatement Accounts Funds
a) The CA Abatement Accounts Funds will be used for future Opioid Remediation in one or
more of the areas described in the List of Opioid Remediation Uses, which is Exhibit E to
the GESA.
b) In addition to this requirement, no less than 50% of the funds received by a CA
Participating Subdivision from the CA Abatement Accounts Fund in each calendar year
will be used for one or more of the following High Impact Abatement Activities:
(1) the provision of matching funds or operating costs for substance use disorder facilities
within the Behavioral Health Continuum Infrastructure Program;
(2) creating new or expanded Substance Use Disorder ("SUD") treatment infrastructure;
(3) addressing the needs of communities of color and vulnerable populations (including
sheltered and unsheltered homeless populations) that are disproportionately impacted
by SUD;
(4) diversion of people with SUD from the justice system into treatment, including by
providing training and resources to first and early responders (sworn and non -sworn)
and implementing best practices for outreach, diversion and deflection, employability,
restorative justice, and harm reduction;
(5) interventions to prevent drug addiction in vulnerable youth, including but not limited
to, youth in foster care, juvenile justice -impacted youth, youth experiencing
adversities related to socioeconomic status, and unhoused youth; and/or
(6) the purchase of naloxone for distribution and efforts to expand access to naloxone for
opioid overdose reversals.
c) The California Department of Health Care Services ("DHCS") may add to this list (but
not delete from it) by designating additional High Impact Abatement Activities. DHCS
will make reasonable efforts to consult with stakeholders, including the CA Participating
Subdivisions, before adding additional High Impact Abatement Activities to this list.
d) For the avoidance of doubt, and subject to the requirements of the Governing Documents
and applicable law, CA Participating Subdivisions may form agreements or ventures, or
otherwise work in collaboration with, federal, state, local, tribal or private sector entities
in pursuing Opioid Remediation activities funded from the CA Abatement Accounts
Fund. Further, provided that all CA Abatement Accounts Funds are used for Opioid
Remediation consistent with the Governing Documents and this Agreement, a county and
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any cities or towns within the county may agree to reallocate their respective shares of
the CA Abatement Accounts Funds among themselves, provided that any direct
distribution may only be to a CA Participating Subdivision and any CA Participating
Subdivision must agree to their share being reallocated.
iii. CA Abatement Accounts Fund Oversight
a) Pursuant to Section 5 below, CA Participating Subdivisions receiving funds pursuant to
the Purdue Bankruptcy Plan and related Sackler settlement must prepare and file reports
annually regarding the use of those funds. DHCS may regularly review the reports
prepared by CA Participating Subdivisions about the use of CA Abatement Accounts
Funds for compliance with the Governing Documents and this Agreement.
b) If DHCS determines that a CA Participating Subdivision's use of CA Abatement
Accounts Funds is inconsistent with the Governing Documents or this Agreement,
whether through review of reports or information from any other sources, DHCS shall
send a request to meet and confer with the CA Participating Subdivision. The parties
shall meet and confer in an effort to resolve the concern.
c) If the parties are unable to reach a resolution, DHCS may conduct an audit of the
Subdivision's use of the CA Abatement Accounts Funds within one year of the request to
meet and confer, unless the parties mutually agree in writing to extend the meet and
confer time frame.
d) If the concern still cannot be resolved, the State may bring a motion or action against the
Subdivision in the court where the State has filed its Consent Judgment to resolve the
concern or otherwise enforce the requirements of the Governing Documents or this
Agreement. However, in no case shall any audit be conducted, or motion be brought, as
to a specific expenditure of funds, more than five years after the date on which the
expenditure of the funds was reported to DHCS, in accordance with this Agreement.
e) Notwithstanding the foregoing, this Agreement does not limit the statutory or
constitutional authority of any state or local agency or official to conduct audits,
investigations, or other oversight activities, or to pursue administrative, civil, or criminal
enforcement actions.
C. CA Subdivision Fund
i. Fifteen percent of the payments to California subject to this Agreement will be allocated
to the CA Subdivision Fund. All funds in the CA Subdivision Fund will be allocated
among the Plaintiff Subdivisions that are Initial Participating Subdivisions. The funds
will be used, subject to any limits imposed by the Governing Documents and this
Agreement, to fund future Opioid Remediation and reimburse past opioid-related
expenses, which may include fees and expenses related to litigation.
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However, in no event shall more than one-third (5% out of the 15%) be used for
litigation -related fees and expenses.
D. Provision for State Back -Stop Agreement
On August 6, 2021, Judge Dan Polster of the U.S. District Court, Northern District of Ohio,
Eastern Division, issued an order (ECF Docket Number 3814) ("MDL Fees Order") in the
National Prescription Opiate Litigation (MDL No. 2804) "cap[ping] all applicable contingent fee
agreements at 15%." Private counsel representing Plaintiff Subdivisions should seek its
contingency fees and costs from the Local Government Costs and Expenses Fund pursuant to the
Governing Documents, and if applicable, the Attorney Fee Fund or Cost Funds under the
settlement agreements with other Opioid Defendants.
A Plaintiff Subdivision may separately agree to use up to one-third (5% out of the 15%) of its
share of the CA Subdivision Fund to pay for fees or costs incurred by its contingency -fee counsel
("State Back -Stop Agreement"), pursuant to Exhibit R of the GESA and the MDL Fees Order, so
long as: (1) such payments, together with any payments to contingency -fee counsel from the
Local Government Costs and Expenses Fund related to such Plaintiff Subdivision, do not exceed
15% of a Plaintiff Subdivision's total gross recovery under this Agreement; and (2) Plaintiff
Subdivision certifies that any payments made under a State Back -Stop Agreement will be made
in accordance with the 95% Opioid Abatement use requirements under Section 5.02(a) of the
GESA and Section 4.01(f)(i) of the MSA. Before seeking fees or litigation costs and expenses
from a State Back -Stop Agreement, private counsel representing Plaintiff Subdivisions must first
seek contingency fees and costs from the Local Government Costs and Expenses Fund funded
pursuant to the Governing Documents. Further, private counsel may only seek reimbursement for
litigation fees and costs that have not previously been reimbursed through prior settlements or
judgments.
To effectuate a State Back -Stop Agreement pursuant to this section, an agreement in the form of
Appendix 2 may be entered into by a Plaintiff Subdivision, private counsel, and the California
Office of the Attorney General. The California Office of the Attorney General shall, upon the
request of a Plaintiff Subdivision, execute any agreement executed by a Plaintiff Subdivision and
its private counsel if it is in the form of Appendix 2. The California Office of the Attorney
General will also consider requests from Plaintiff Subdivisions to execute and enter into
agreements presented in other forms.
For the avoidance of doubt, this Agreement does not require a Plaintiff Subdivision to request or
enter into a State Back -Stop Agreement, and no State Back -Stop Agreement shall impose any
duty or obligation on the State of California or any of its agencies or officers, including without
limitation the Attorney General.
s
Docusign Envelope ID: B1989F9E-FFFB-4COE-8DE3-5767DA3F4316
5. State and Subdivision Reporting
a) DHCS will prepare an annual written report regarding the State's use of funds from the
settlement until those funds are fully expended and for one year thereafter. These reports
will be made publicly available on the DHCS web site.
b) Each CA Participating Subdivision that receives payments of funds from the Purdue
Bankruptcy Plan and related Sackler settlement will prepare written reports at least
annually regarding the use of those funds, until those funds are fully expended and for
one year thereafter. These reports will also include a certification that all funds that the
CA Participating Subdivision has received through the Purdue Bankruptcy Plan and
related Sackler settlement have been used in compliance with the Governing Documents
and this Agreement. The report will be in a form reasonably determined by DHCS. Prior
to specifying the form of the report DHCS will confer with representatives of the Plaintiff
Subdivisions.
c) The State and all CA Participating Subdivisions receiving CA Abatement Accounts
Funds will track all deposits and expenditures. Each such subdivision is responsible
solely for the CA Abatement Accounts Funds it receives. A county is not responsible for
oversight, reporting, or monitoring of CA Abatement Accounts Funds received by a city
within that county that receives direct payment. Unless otherwise exempt, Subdivisions'
expenditures and uses of CA Abatement Accounts Funds and other payments will be
subject to the normal budgetary and expenditure process of the Subdivision.
d) Each Plaintiff Subdivision receiving CA Subdivision Funds will track all deposits and
expenditures, as required by the Governing Documents and this Agreement. Among other
things, Plaintiff Subdivisions using monies from the CA Subdivision Fund for purposes
that do not qualify as Opioid Remediation must identify and include in their annual
report, the amount and how such funds were used, including if used to pay attorneys'
fees, investigation costs, or litigation costs. Pursuant to Section 5.02(b) of the GESA and
Section 4.01(f)(ii) of the MSA, such information must also be reported to the Settlement
Administrator and Sackler Parties' Representative.
e) In each year in which DHCS prepares an annual report DHCS will also host a meeting to
discuss the annual report and the Opioid Remediation activities being carried out by the
State and Participating Subdivisions.
6. Miscellaneous
a) The State or any CA Participating Subdivision may bring a motion or action in the court
where the State has filed its Consent Judgment to enforce the requirements of this
California Purdue/Sackler State -Subdivision Agreement. Before filing such a motion or
action the State will meet and confer with any CA Participating Subdivision that is the
subject of the anticipated motion or action, and vice versa.
Docusign Envelope ID: B1989F9E-FFFB-4COE-8DE3-5767DA3F4316
b) Except as provided in the Governing Documents, this California Purdue/Sackler State -
Subdivision Agreement is not enforceable by any party other than the State and the CA
Participating Subdivisions. It does not confer any rights or remedies upon, and shall not
be enforceable by, any third party.
c) Except as provided in this Agreement, if any provision of this Agreement or the
application thereof to any person, entity, or circumstance shall, to any extent, be invalid
or unenforceable, the remainder of this Agreement, or the application of such provision to
persons, entities, or circumstances other than those as to which it is invalid or
unenforceable, will not be affected thereby, and each other provision of this Agreement
will be valid and enforceable to the fullest extent permitted by law.
d) Except as provided in the Governing Documents, this Agreement shall be governed by
and interpreted in accordance with the laws of California.
Docusign Envelope ID: B1989F9E-FFFB-4COE-8DE3-5767DA3F4316
The undersigned, Palm Springs city, CA, ACKNOWLEDGES acceptance of this Proposed
California State -Subdivision Agreement Regarding Distribution and Use of Settlement Funds -
Purdue/Sackler Settlement is a requirement to be an Initial Participating Subdivision and
ACCEPTS this Proposed California State -Subdivision Agreement Regarding Distribution and
Use of Settlement Funds - Purdue/Sackler Settlement.
I swear under penalty of perjury that I have all necessary power and authorization to execute this
agreement on behalf of the Governmental Entity. DocuSigned by:
Signature: S(# NI's
Name: scott stiles
Title: city Manager
Date: 7/28/2025
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Docusign Envelope ID: B1989F9E-FFFB-4COE-8DE3-5767DA3F4316
APPENDIX 2
CALIFORNIA-SUBDIVISION BACKSTOP AGREEMENT
On August 6, 2021, Judge Polster of the US District Court for the Northern District of Ohio
issued an Order (the Order), docket number 3814, in In Re National Prescription Opiate
Litigation, MDL 2804, addressing contingent attorney fee contracts between political
subdivisions eligible to participate in the Purdue/Sackler settlement and their counsel.
In light of the Order, and at the request of [SUBDIVISION], the [SUBDIVISION], its counsel
[COUNSEL], and the California Attorney General, on behalf of the State of California, are
entering into this California -Subdivision Backstop Agreement (Backstop Agreement).
[SUBDIVISION] and [COUNSEL] intend this Backstop Agreement to constitute a State Back -
Stop Agreement as that term is used in the Order and in Exhibit R (Agreement on Attorneys'
Fees, Expenses and Costs) of the Governmental Entity & Shareholder Settlement Agreement
(GESA).
Pursuant to this Backstop Agreement, [SUBDIVISION] may, subject to the limitations of the
Governing Documents and California Purdue/Sackler State -Subdivision Agreement, as well as
any other limitations imposed by law, use funds that it receives from the CA Subdivision Fund of
the Purdue/Sackler settlement to pay a contingent fee to [COUNSEL]. Any such payment from
[SUBDIVISION] to [COUNSEL] from [SUBDIVISION'S] CA Subdivision Fund allocation will
not exceed [PERCENTAGE NOT TO EXCEED ONE-THIRD OR 5% OUT OF THE 15%] out
of the [SUBDIVISION'S] 15% CA Subdivision Fund allocation; provided further that such
payments, together with any contingency -fees that [COUNSEL] may receive from the Local
Government Costs and Expenses Fund, will not exceed a total contingency fee of
[PERCENTAGE NOT TO EXCEED 15%] of the [SUBDIVISION'S] total gross recovery from
the Purdue/Sackler settlement. [SUBDIVISION] further certifies that any payments made under
this Backstop Agreement will be made in accordance with the 95% Opioid Abatement use
requirements under Section 5.02 A of the GESA and Section 4.01(f)(i) of the Master Settlement
Agreement.
[COUNSEL] certify that they first sought fees and costs from the Local Government Costs and
Expenses Fund created under the Governing Documents before seeking or accepting payment
under this backstop agreement. [COUNSEL] further certify that they are not seeking and will not
accept payment under this backstop agreement of any litigation fees or costs that have been
reimbursed through prior settlements or judgments.
The Attorney General is executing this agreement solely because the definition of "State Back -
Stop Agreement" in Exhibit R of the Governmental Entity & Shareholder Settlement Agreement
requires such agreements to be between "a Settling State" and private counsel for a participating
subdivision. Neither the California Attorney General nor the State of California have any
obligations under this Backstop Agreement, and this Backstop Agreement does not require the
payment of any state funds to [SUBDIVISION], [COUNSEL], or any other party.
Docusign Envelope ID: B1989F9E-FFFB-4COE-8DE3-5767DA3F4316
[DATE]
[DATE]
[DATE]
[SUBDIVISION SIGNATURE BLOCK]
[COUNSEL SIGNATURE BLOCK]
[ATTORNEY GENERAL SIGNATURE BLOCK]
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