Ottawa County Faces Sanctions for Delaying Opioid Payouts in Michigan

The Michigan County faces legal consequences after a judge found that officials had submitted frivolous court filings that unnecessarily delayed cash payments. 

MICHIGAN—What happens when one Michigan county’s legal shenanigans stand in the way of millions of dollars for hundreds of local communities? Ottawa County is about to find out.

A judge this week ruled that right-wing leaders in Ottawa County signed frivolous court filings, made deceptive claims, and relied on facts that they “had no reasonable basis to believe” when they sought more cash than they deserved during a recent state settlement, state officials said.

“Ottawa County held up this significant settlement distribution from which its residents stand to gain greatly,” Attorney General Dana Nessel said in a statement on Thursday. “Judge Fresard’s sanctions properly reflect the frivolous nature of Ottawa County’s misuse of the courts.”

Here’s the deal:

Nessel’s office finalized a massive settlement agreement with some of the nation’s largest wholesale drug distributors last year following a lawsuit over their role in exacerbating the state’s opioid addiction crisis. All told, Michigan reportedly received $776 million of the $26 billion nationwide settlement—the largest settlement reached in litigation that spans several cases.

The judgment against AmerisourceBergen, Cardinal Health, and McKesson Corp. called for the cash to be paid out incrementally over 18 years—half going to the state, half paid to local governments, and just about all of it earmarked for opioid addiction treatment and prevention.

About $81 million was slated to go to local governments this year, including about $700,000 to Ottawa County. But leaders there threw a wrench in the plan in November when they reportedly filed a legal complaint that demanded more cash than what had been allocated. 

Hillsdale County Commission Chairman Mark Wiley said the failed legal maneuvering by Ottawa County ultimately delayed the statewide payout in other Michigan counties by six months.

“The opioid epidemic isn’t limited to cities. It reaches deep into smaller communities like ours where, every day, we still see the havoc caused by opioid addiction,” Wiley said in a statement.

After dismissing Ottawa County’s request for more cash, a judge—in what state officials have since billed as a “rare move”—also decided this week to issue sanctions against the county for wasting time (and delaying the settlement) with “frivolous filings” and “deceptive claims.”

Conrad Mallet, an attorney for the city of Detroit, said Ottawa County’s actions “inflicted real harm by delaying the use of settlement funds to combat the worst drug crisis in history.”

Deputy Grand Traverse County Administrator Chris Forsyth added: “Opioid addiction doesn’t discriminate based on where someone lives or how much money they make. We are anxious to use settlement funds to help our community heal and prevent any more lives from being destroyed. Thankfully, this ruling finally allows us to move forward in that mission.”  

More than 50 local governments joined with Nessel to request the sanctions against Ottawa County. The exact consequences will be determined by a judge at a hearing on May 10.

Ottawa County will continue to receive the settlement payments it was initially allocated, per the agreement between the state and participating local governments, state officials said.