Latest / The Jon and Marc Podcast / Inside the $70B Opioid Litigation and the New Battle Against Pharmacy Benefit Managers

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Inside the $70B Opioid Litigation and the New Battle Against Pharmacy Benefit Managers · The Jon and Marc Podcast

0:00
We're not talking aspirin, you know, We're not talking
0:02
antibiotics. We're talking opium.
0:04
The most addictive molecule. Replicated it in massive
0:08
quantities of high potency. Put it in a pill.
0:11
And then sold it to the most trusted people in America
0:14
wearing white coats. At pharmacies.
0:17
As non addictive. As non addictive.
0:28
Thursday morning in Puerto Rico and our first guest today on the
0:31
John and Mark podcast is former presidential candidate.
0:35
Paul Farrell, also Co lead of the opioid litigation, also
0:41
involved in the Google antitrust litigation to help protect some
0:44
of the publishers, the small guys.
0:46
If you are in the mass tort world, you know, Paul, we're
0:49
going to get deep into some of his involvement in these
0:52
specific cases. And I want to know what actually
0:54
happened with your presidential run.
0:56
We will get into that too, but thank you so much for joining us
0:59
on the podcast. Thank.
1:00
You for having. Me, Paul, we're in Puerto Rico.
1:02
I'm covered in linen. We have a beautiful view.
1:05
And everyone I've talked to, I said I've we needed to speak
1:08
with you. OK.
1:09
They didn't say why, but they kept saying you need to talk to
1:12
Paul. Yeah.
1:13
So let's get into it. The opioid litigation.
1:16
I didn't realize you're the man behind the scenes on that
1:19
humongous like, litigation that's still ongoing.
1:21
Like, how much have you guys recovered so far?
1:23
Where is it in the process? We'd love to just learn more
1:26
about that because it is recently was just in the new
1:29
cycle again. The short answer is, is we've
1:31
recovered about $70 billion and most of the money we have.
1:35
Structured in settlement to cities, counties and states with
1:40
guardrails to use only for the abatement of opioid use, abuse,
1:45
morbidity and mortality. So in short, what we're trying
1:48
to do is avoid the tobacco settlement scenario where the
1:52
money gets picked up by the state legislatures and
1:55
disappears into the the the public digest and the budgets.
1:59
And so we have. We've created in each of the 50
2:02
states. Some type of structure so we
2:04
know the money gets spent to help addiction.
2:06
We started the case at the top of the food chain, the
2:10
manufacturers, Purdue Pharma, then the generics and then the
2:13
distributors. And then we moved on to the
2:16
chain pharmacies. And now we're on the fourth and
2:19
last iteration, I think, of the pharmacy benefit managers.
2:22
This is a a topic that like I, I personally care a lot about my
2:27
my father was addicted to opioids for a while and he got a
2:31
really bad accident when I was probably 12-13 years old.
2:35
I think you know the story Like he used to work in a prison and
2:39
the elevator malfunctioned. Big old prison elevator door
2:44
sensor broke and knocked him to the ground and knocked out all
2:50
of his teeth, hurt his back like couldn't work again after that.
2:53
And you know, the way that he dealt with it was with
2:57
oxycodone, hydrocodone, it doesn't just affect the
3:02
individual, it affects the family.
3:04
It's a major, major problem. I don't think people actually
3:08
know what you just said that the recoveries for, for this case is
3:14
going into fixing the problem as opposed to just compensation for
3:18
the damages that that have occurred.
3:20
And, and I personally, I did not know that.
3:23
And I, I thank you for that and for continuing to pursue that
3:26
because that is something that is especially.
3:27
The point we made with this this the city and state legislators
3:30
get the money, then it's it's gone, disappears.
3:33
Yeah. And no one gets helped.
3:35
So in West Virginia with the tobacco settlement, I think we
3:39
used the money to retire public debt to especially our workers
3:43
compensation public funds and for, you know, infrastructure in
3:47
the state. Very little that was actually
3:49
used for tobacco cessation. We had that consciously in mind
3:53
when we started this litigation, and it was the reason that we
3:57
structured it the way that we did.
3:59
So my hometown in Huntington, WV is Ground Zero.
4:03
It's one of the earliest places that you can see the blossom of
4:06
the opioid epidemic. There's a great book.
4:10
There's a lot of great books, but the book that I cherish the
4:12
most is called Dreamland by Sam Quinones, and he talks about the
4:17
intersection between the prescription pill flood and the
4:23
intersection with heroin, black tar heroin from Mexico.
4:26
In Chapter 2, it's called Huntington, WV, where he's
4:29
sitting on the riverbank sort of wondering how it is that we got
4:33
to this position we're in. It's one of the the early
4:36
foundations for how I began to think about it back in 2016.
4:42
We had newspaper headlines in West Virginia, which is going to
4:45
tie into my Google. Case later the Charleston
4:49
Gazette, the headlines of the Charleston Gazette said. 700
4:53
million pills, 1700 deaths. Some local journalist got a hold
4:59
of some data accidentally from the DEA that revealed the volume
5:03
of pills that were distributed into the state of West Virginia.
5:07
That's insane. Now, to give you some
5:08
perspective, we have 1.3 million people in the state of West
5:13
Virginia. 700,000 pills 700 million 700 million pills.
5:18
And a six year window. And 17,000 in West Virginia.
5:22
Yes, so that so my, my, my father's a judge and every
5:28
Sunday morning he has a breakfast for his the boys and
5:31
their families. You know, he puts on an apron
5:33
and he cooks eggs and bacon after church and say, I remember
5:36
we was. Sitting at the kitchen table.
5:39
And my mom has that newspaper and she plops it down in front
5:42
of me and she says. What are you going to do about?
5:46
It I said, Mama, that's not what I do.
5:48
I'm a. Personal injury lawyer and she
5:50
says. Well, you should do something
5:51
about it. So I took that challenge and
5:55
started thinking about it, and there was just something in the
5:59
back of my mind that triggered that.
6:02
What? This wasn't really a personal
6:04
injury case. It was like if the Exxon Valdez
6:08
crashed into the shores of Alaska and dumped oil
6:11
everywhere. The private land owners would
6:14
have a remedy. But in also in general, the
6:18
public would have a remedy for the damage to the
6:21
infrastructure, the water, the beach line, the ocean, right?
6:24
There's a public nuisance consequence.
6:26
A common law public nuisance consequence.
6:29
To to behavior, especially at a corporate level.
6:33
And so I got out the West Virginia code and I started
6:36
thinking about who has standing to bring a public nuisance case
6:41
on behalf of the public, not a private.
6:44
Cause of action for a public nuisance.
6:46
But if the public has a cause of action, who has standing?
6:50
And I started flipping through it.
6:52
And I came across this one code section that said that our
6:56
county commissioners. Have standing to eliminate
7:00
hazards to public health and safety and debate or cause to be
7:06
abated public nuisances. So I went to the next county
7:09
Commission meeting and said to the three commissioners.
7:12
I got this code section says here you have a.
7:15
Do you have a standing to do something about this?
7:18
Let me do something for you. I'll pay for it.
7:21
If we lose, I'll eat all the costs.
7:24
If we in, you know you owe me a. Fee and they said sure.
7:28
You you treated it like a a true plaintiff's lawyer.
7:31
I filed the first public nuisance case on behalf of my
7:34
hometown, Cabo County, West Virginia.
7:37
And then? I started as word started to
7:40
spread. I went down into southern coal
7:42
fields. I went across the Ohio River to
7:45
southern Ohio. I went over into Eastern
7:47
Kentucky and I wound up with about. 40 counties that were in
7:50
the heart of this devastation of pills in in basically at the
7:55
apex under the devastation. All of a sudden, like any true
7:59
epidemic, the hotspot started popping up in other places
8:02
around the country, right. New Mexico was a hotspot.
8:06
If you look at the CDC death maps now you can see.
8:09
Over time the flare of the opioid epidemic and slowly this
8:14
thing started, you know, getting more and more attention and MDL
8:18
was formed. I got appointed Co lead of the
8:21
MDL. And the little hillbilly lawyer
8:24
from West Virginia. Got to be in.
8:26
Charge of the biggest, most complex case in the history of
8:29
our MDL world. Where does it currently sit now?
8:34
So we're in Cleveland. Ohio still and there's about
8:38
3000 cases. 3000 counties and cities across the country have
8:42
all joined in. And we've settled with the three
8:46
of the four. There's a chain of distribution
8:48
that you can follow. The manufacturers, the
8:51
distributors, the pharmacies, those cases are 95% done since
8:55
Stradler's and the newest iteration is we're exploring the
9:01
role of pharmacy benefit managers, the health insurance
9:04
companies that evolve vertically and integrated and control the
9:07
formularies in America and have contracts, rebate contracts with
9:12
the manufacturers. I've, I've learned a little bit
9:14
about those recently. Yeah, those are quite a scheme.
9:18
It's a. It's a corporate structure that
9:21
seems to have grown so substantially and so
9:26
significantly. The amount of power and control
9:29
they have over healthcare decisions is astonishing.
9:32
So the premise of the case in a, in a 32nd summary is that the
9:41
manufacturers, the distributors, the pharmacies are all aware of
9:45
what's going on and that the pills aren't necessarily going
9:47
to the the end user to use them or they are.
9:51
And they're, they're clearly being done at a, or being
9:57
prescribed at a rate that they should not be prescribed.
9:59
Both, both, right? But those are the 2 avenues.
10:03
We call it. The legal term for it is.
10:05
Diversion is that the pills are going in such quantity to so
10:11
many people that it's clear, facially evident, that the pills
10:16
cannot have a legitimate medical purpose.
10:18
So when you look and you see a million pills a year going
10:22
through one pharmacy in a town of 1700 people, clearly and
10:29
objectively there is no legitimate medical.
10:31
Purpose for that right, there are controls in the system
10:35
required by federal law to identify those anomalies and to
10:40
prevent them. So whether it's from at the
10:42
manufacturer level or the distributor level or the CVSS of
10:46
the world, they have data points that indicate not just where the
10:50
pills are leaking, but where they're just gouts just flowing
10:54
out unrestricted like I can Pez dispenser and so.
10:59
It's for those people that we have held accountable for
11:02
controlling controlled substances because remember,
11:05
we're not talking aspirin, you know, we're not talking
11:08
antibiotics. We're talking opium.
11:11
And. We're not just talking opium,
11:14
we're talking the most. Addictive molecule created by
11:18
God, man, and in this case the American pharmaceutical.
11:23
Industry isolated that molecule, replicated it.
11:29
In massive quantities of high potency put it in a pill and
11:34
then sold it to the most trusted people in America.
11:37
Wearing red coat. Wearing white coats.
11:39
At pharmacies. As non addictive.
11:41
As non addictive. Have you have you ever taken a
11:45
pill? I have.
11:46
Absolutely. Have you ever taken a pill?
11:48
Yeah, like for surgery. How does it make you feel?
11:51
I get pretty sleepy. How did it make you feel sleepy?
11:55
Where are you going with this? I'm just.
11:58
I'm just no. No, like this is, this is like
12:02
the reality of it is it's, it's real people who take these
12:05
things for, for real reasons. And, and it turns into something
12:10
else. Like I've, I've, I have like an
12:12
emergency prescription of, I think it's hydrocodone.
12:16
So I have spinal stenosis in my back, OK, right.
12:18
And when the nerve in my back touches the herniated disc, I
12:23
can't move. I think I've, you've seen me
12:25
like this before where I'm stuck for like 3 days.
12:28
The only thing that can get me to to move, to get up, to go to
12:33
the bathroom, to get dressed is to, to take, I take half a pill
12:38
and it's like the magical elixir, right?
12:41
All of a sudden I can get up, I can move.
12:43
I have this false sense of security that everything is good
12:45
now and then it comes back in four to six hours.
12:49
And I, I have a choice at that point, either can lay back down
12:53
and and be horizontal until the the issue subsides, or you can
12:57
take another pill. And not everyone has the
12:59
self-control to be able to say, I'm just going to lay down and
13:02
wait and do 15 minutes on 15 minutes off with ice.
13:05
You're just going to take another pill.
13:07
And that feeling of being able to just eliminate the pain and
13:11
the problems. Is it is not a safe thing?
13:16
You can live on that stuff. Yes.
13:19
So. I'm not a doctor, but I have now
13:21
been around enough families and enough.
13:23
You're almost pretty much an expert.
13:25
I've heard this story before. This is what I, I would say if
13:30
you were my client or if I were a doctor and you are my patient,
13:34
is that the pain is, is not being eliminated.
13:39
It's just being dampened, like the opium is covering the marker
13:44
of the pain. The pain is there for a reason.
13:46
It's your body's physiological response to something going on.
13:50
And so yes, taking an opiate does cover or mask the pain.
13:56
But what we know now from the CDC data is that if you are
14:03
prescribed a week of prescription opioids A7 day
14:07
supply, 7% of the population is refilling that prescription a
14:14
year later. So if you think about that just
14:17
as its own statistical proof, if you start a prescription or
14:22
prescription opioids A1 week prescription, if if you fill it,
14:25
the doctor writes it and you take it to a pharmacy, we know
14:28
now that 7% of that population is still refilling a year later
14:35
if you refill that week prescription.
14:39
Like you get a week and then you get a refill for the second
14:43
week. We know that 17% of the
14:47
population is still refilling a year later.
14:51
And if you have. A 30 day prescription and you
14:55
refill that prescription. We know more than 30.
14:58
Percent of the population is still.
15:00
Refilling it a year later. So are you saying like a seven
15:04
day prescription, like refilling on 7 day increments a year
15:08
later? I thought you were saying 7 days
15:12
and then a year later they refill.
15:14
They're still refilling a year late.
15:17
This is insane but. So what we're But again, it is
15:21
insane except for it's opium. Yeah, it's correct.
15:26
It's it's opium that's been processed the perfect way of
15:30
putting a pill by the smartest scientists in America.
15:32
Right now to put it in a little more context.
15:35
So of course I've had plenty of time to read about all of this
15:38
and it occurred to me that there have been other occasions where
15:42
where this has happened. And so to me, I found this
15:45
great. Quote that says that there's no
15:47
new evil in the world, we just reinvent ways to deliver pain,
15:51
right. And so it made me think about
15:53
the historical passages of all of this.
15:55
And so I was reading about when when England was colonizing
16:00
India the in the early 1800s. It became a cost prohibitive,
16:06
right? England was spending a whole
16:08
bunch of money on its colony in India.
16:10
And you know, back in England at Parliament, they're like, we, we
16:13
have these colony, this colony to make us money, to make us
16:17
the, the empire under the sun, right?
16:19
The money. Should flow back to us.
16:21
But it's draining our coffers. What's the biggest cash crop in
16:25
India? The poppy.
16:27
Fields the English parliament didn't want to sully itself with
16:33
being peddlers of opium, so they gave a charter to a company that
16:39
would take the the poppy in in England, the opium in England
16:43
and or in India and. Sell it somewhere else, the East
16:46
India Trade Company. And so the East India Trade
16:49
Company would take cannonball size, you know, balls of opium
16:54
and put them on these huge ships and take it to.
16:56
China think you, you might know where I'm going with this.
17:00
So that in China at this time in the early 1800s.
17:05
The the Chinese people thought the white man, they were
17:09
Barbarians, big, hairy, crude, rude, smelly white men on big
17:15
ships that were coming. And they would not let us come
17:18
inland. They had this one little port
17:21
with these big gates, and this is where all the camps were for
17:26
all the shippers who would come and land and they would have
17:29
markets outside of the gates and then the goods could be taken
17:33
inside the gates, right? Well, we started.
17:35
Bringing all the opium into China.
17:38
Well, all of a sudden opium became a problem in China and
17:43
the Chinese emperor decided. Looked.
17:45
I don't know what they're bringing.
17:46
To us. But this is awful, right?
17:48
So they decided to punish the users.
17:51
They were going to arrest their way out of the problem.
17:54
And So what they begin doing is flogging the opiate addicts in
17:59
the streets to teach them a lesson.
18:01
And all of a sudden they were, they were flogging 250,000
18:05
people. Like, I mean, it was, it was
18:06
perfect. So then they decided, OK, we
18:08
can't, we can't beat our way. We can't punish our way out of
18:13
the, the users. So if you get caught dealing the
18:17
white man's opium in China, we're going to publicly
18:21
strangulate you like you have to get on your knees in the town
18:24
square and we're going to strangle you well after they
18:27
executed 25,000 drug dealers, the Chinese emperor said.
18:31
This isn't working. So he created an embargo around
18:34
the this little inlet and put up his warships.
18:38
Well, unbeknownst to the Chinese emperor, the greatest sea
18:43
wartime Navy in the world at this point was owned by the East
18:48
India Trade Company. So the East India Trade Company,
18:52
under charter with Parliament had war powers, blew up the
18:56
blockade and occupied this little inlet called Hong Kong.
19:02
And Britain didn't give it up for another 100 years.
19:05
And it resulted in the toppling of the Chinese emperor, the
19:08
Chinese diaspora, the Boxer Rebellion, and it's how we wound
19:11
up with the Chinese immigrants. Into the West Coast of.
19:15
America and they brought with them their their opium.
19:20
And so then we began to see the first signs of opiate addiction
19:24
and laudanum in the 19 teens in America.
19:27
And so, like I said, I've said this before.
19:31
It's like Pandora's. Box Every time we've figured out
19:34
a new, better delivery system of opium, we've had an outbreak.
19:40
Right when there was a new market in China, there was an
19:43
outbreak. When there was a new market in
19:45
America in the early 1900s, there was an outbreak.
19:48
And what we've done here in America is we created a new
19:52
market when the Pharmaceutical industry jumped on board with
19:55
opium. License.
19:57
And license to to dispense History repeats itself.
20:01
My brain is like now you said it all my it's all clicking and.
20:05
What's the alternative right if opiates go away right if the the
20:12
if you just get rid of them and remove them from society, What
20:15
is what is the alternative method of pain resolution for
20:21
individuals for you? It's surgery, right?
20:26
For cancer patients, for palliative care, it's morphine,
20:30
right? It's it's, it's what what I
20:34
think it there is an absolute place.
20:37
Not only in our society, but in the practice of medicine for.
20:40
Opiates, no question about it, but I think where we got where
20:46
this thing really went off the rails is, you know, in the
20:49
early. 2000s when they were clear signs of abuse.
20:54
It's when it wasn't pain specialists or oncologists or
20:59
board certified doctors that were prescribing it, when all of
21:02
a sudden we were pushing the pain pills through family
21:09
physicians that were just handing it out like aspirin or
21:12
an ibuprofen or an anti-inflammatory.
21:15
That's where it really turned the corner.
21:18
And there were supposed to be safety valves on all of this
21:21
distribution chain of supply and we just blew through it, right.
21:26
But again, it's not like. There was a speed limit for 55
21:30
and that there were there were doctors prescribing at 60 miles
21:34
an hour or 70 miles an hour, right?
21:37
On 1000 miles an. Hour, right?
21:39
It's like if the safety valve on your hot water tank is supposed
21:42
to be 120°. We were letting it get to 5.
21:44
100° I see a lot of parallels to like and same time frame to to
21:50
the mortgage crisis. There should have been so many
21:52
different, so many different clear indicators to people that
21:57
there was a problem. And the sad part about the
21:59
opioid epidemic is that in the mid 2000s.
22:01
The DEA did try to get to intervene.
22:05
It's a whole nother story. There's a great 60 minute series
22:08
on it with Joe Rinnazessi from the DEA who the the title of the
22:12
segment is called Whistleblower where he went after the
22:15
distributors to try to choke down the supply and they went to
22:19
Congress and got him fired. Funny other words, I when you're
22:23
going to the story. I've been in the mass tort world
22:26
for a good bit now. I actually, I see the the
22:30
verdicts come out or on the opioid stuff here or there pops
22:32
up. But generally it's been
22:33
extremely quiet in the news, in the news cycle.
22:36
And I'm very surprised that like, I want to know who's
22:39
behind the scenes making sure that none of this news is
22:42
getting out to the public because I don't, I didn't
22:45
realize it was 50 billion or what would you say, 7070
22:48
billion, 70? Billion now, yeah.
22:51
You you hear it, but it goes away.
22:53
The news. Very quick it'll be like, oh,
22:54
Walgreens get has to settle for whatever.
22:57
I don't think most of the audience knows a 70 billion and
22:59
it's like that new cycle. I know they had a bad PR section
23:03
for a while but the Pharmaceutical industry has kept
23:05
this under hush pretty well. The most astonishing thing to me
23:10
is that all of most of the companies that settled with us,
23:14
their stock prices rose after the settlement.
23:17
Yeah. They're reducing the exposure.
23:19
Yeah, it's, it's it's. These companies are so large
23:24
they're impossible to fail, and they.
23:27
They vertically integrate and consolidate the markets in a
23:30
contraction. There's more money in the market
23:32
than you've ever seen. So yeah, I mean, it's, it's it's
23:35
astonishing. Was the opioid issue related to
23:40
your presidential run? No.
23:43
Completely around the same time. The presidential run was right
23:47
before. I think right before all of this
23:50
happened, yeah. What?
23:51
How did that come about? What's the why?
23:55
So I'm from Southern West Virginia and a very heavy coal,
24:02
coal companies, you know, the industry.
24:04
And if you think about it, it's not just the coal miners, right?
24:07
Is that you have the pension funds, the healthcare funds, you
24:11
have the service supply, you have the people that make the
24:13
pipe, you have the people that make the steel, people that make
24:16
the machines, the electricity, the water pumps.
24:19
I mean, it's an entire ecosystem.
24:21
It's an, it's a, it's the entire infrastructure of southern West
24:25
Virginia revolves around coal. And we like to think that, you
24:30
know, we, we were there for World War Two.
24:33
We built the skyscrapers, we powered the company.
24:36
We, we, you know, we were strong for our country.
24:40
And then Barack Obama ran for president.
24:43
And one of his platform positions was that it was OK to
24:48
mine coal, but he was going to make it so expensive he would
24:51
bankrupt the coal mine, the coal companies.
24:53
That's a quote of his. He believed in the Clean Water
24:57
Act and he he wanted to transition away from fossil fuel
25:01
energy. And that was a big platform.
25:04
So Hillary ran against him in the first time for the
25:07
Democratic primary. And Hillary went and took the
25:11
opposite position. She came to West Virginia and
25:14
she went around campaigning that she was the granddaughter of a
25:17
coal miner that she'll never forget, Never forget.
25:22
So then it was Hillary's turn to run for president.
25:26
What? What year was this 20?
25:28
16 It was Hillary's turn to run for president, and she went on
25:33
national television and said she was going to continue Barack's
25:37
policy. And she literally said you can
25:40
find it on YouTube. We're going to put a lot of coal
25:44
companies and coal miners out of work.
25:46
We're going to put a lot of coal miners and coal companies out of
25:50
business, right, Tim? And we're going to make it clear
25:53
that we don't want to forget those people.
25:56
Those people labored in those mines for generations.
26:01
She said that out loud and I remembered what she had said in
26:06
West Virginia and she it pissed me off.
26:08
In fact, I think what she actually said was we're going to
26:10
put a lot of coal companies and coal miners out of business.
26:14
Write Ted to somebody in the audience.
26:17
I spent a tremendous amount of time finding trying to find Ted.
26:20
I can't remember. That's his name.
26:21
Or not, but that's the quote. She wasn't in West Virginia when
26:24
she said this on her campaign trail.
26:26
But she did have to come back to West Virginia and do a round
26:30
table at one of our local community halls to try to repair
26:33
the damage. But by that time it was too
26:35
late. Well, it pissed me off when this
26:36
happened, so I started doing some research into it and there
26:43
were two things that I found interesting.
26:45
One was that what Barack Obama did was genius.
26:50
So he couldn't get his bill through Congress.
26:54
And so he used the EPA, He used administrative action to the EPA
27:00
to adopt policies and procedures that no other president had been
27:03
able to do. So I went back and started
27:05
looking. It's like in 1970, the clean
27:07
water, the no, we, we developed this EPA emissions regulations
27:12
and then we studied it through to George Bush.
27:16
The George Bush EPA administration found there was
27:20
not enough sufficient evidence to show mercury and coal
27:23
emissions. And then Clinton reversed it.
27:26
And then George Bush Junior reversed it.
27:29
And then Obama came in and put it through.
27:31
And through administrative Fiat, he was able to shut down our
27:36
industry. And I warned people about giving
27:41
too much power to the person sitting behind the Oval the the
27:46
the desk in the Oval Office. Because what happens if one day
27:50
the man sitting or woman sitting back there doesn't share your
27:52
ideology? It's a little.
27:55
Foreshadowing. But in general, what I did was I
27:58
went to to my Senator Joe Manchin and Joe had just taken
28:03
Bob Byrd's seat, the long time West Virginia senator and I had
28:08
was reading Bob Byrd's book to Senator.
28:12
Bob Byrd was the senator from West Virginia forever.
28:16
And one of the stories that I read about was the 1976 he ran
28:20
for president as the sitting US Senator in West Virginia.
28:26
And he won 31 of the 33 delegates.
28:30
And that was the year Jimmy Carter was nominated as
28:32
president. And Jimmy Carter had to go
28:35
through like 10/11/13 votes to get the consensus.
28:40
And then everybody pledged their delegates to Jimmy Carter except
28:43
Bob Byrd, the young senator from West Virginia.
28:46
So Jimmy Carter went to him and said, hey, everybody's we're
28:50
going to be unanimous here. It's what we do is, you know,
28:53
after all the votes, you pledge your delegates to me.
28:56
And Bob Byrd said, no, I'm not giving them to you.
28:59
And Jimmy Carter said, what do you want?
29:00
And he goes, I want to be Senate Appropriations chair.
29:04
That's how Bob Byrd got to be Senate Appropriations chair.
29:08
So when this cycle came around, I called my senator Joe Manchin,
29:13
and I said, I just you're in Bob Byrd's seat.
29:15
I just read this chapter. Let me tell you what he did.
29:18
You're in an off cycle. You don't have to get up your
29:21
Senate seat, right? You don't run for Senate for
29:23
another four years. You can run for president right
29:26
now in West Virginia alone. You can go around the state
29:30
saying that you won't forget that you'll always remember.
29:34
And by the way, you're having trouble getting your pension
29:37
fund bill, the UMWA pension funds bill through Congress,
29:41
right? So you can hold on to that.
29:43
And then when you're when you win 31 of 33 delegates, you can
29:47
tell Hillary that you'll pledge your delegates, but she has to
29:51
put your pension bill on her 100 day plan.
29:53
It's a no brainer. You can raise a war chest.
29:56
You'll be the, the you know you'll, you'll be taking the
29:59
place of Bob Byrd's seat. You're beloved in our state.
30:03
It's a no brainer, Joe, you know, and he said I can't do it.
30:08
I can't do it, Paul, He said. I've already pledged my support
30:11
to Hillary. The Clintons are heavy-handed on
30:15
the Democratic Party and they'll be consequences if I do that,
30:18
and I'm afraid to do it. So I got pissed off.
30:21
At least he was honest with you. He was.
30:23
Perfectly honest. So So I got pissed off now.
30:27
Walked across the street to the state capitol and I wrote a
30:29
$2500 check to put my name on the ballot so that it would say
30:33
Bernie Sanders, Vermont, Hillary Clinton, New York, Paul Farrell,
30:39
Junior West Virginia. I got 9% of the vote.
30:43
I was about 200 votes shy of getting 3 delegates to the
30:46
National Convention. I didn't spend a dollar.
30:49
I didn't raise a dollar. I just knew that when people
30:51
looked at the ballot and they saw, you know, the choice of
30:55
West Virginia versus New York and Hillary and Bernie, that
30:59
that it was a protest vote. I guess if you would, and I tell
31:03
you this, if Bernie had dropped out of the race, I don't want
31:07
West Virginia. I would have won West Virginia.
31:10
What story? So you're telling me you're
31:12
going to run again? No, no, I was, I was making a
31:16
point, I think, to the state Democratic Party to pay
31:21
attention to what's happening in our home.
31:24
And they didn't. And that's why my state is as
31:28
red today as any state in the country.
31:33
Speaking of the EPA thing, I'm pretty sure a bunch of all that
31:35
got rolled back because the Supreme Court said that the EPA
31:38
cannot make up laws because they're not a governing body.
31:41
A. Little bit too late for my home.
31:42
Yes. Want to shift gears?
31:46
Talk about your involvement with another litigation, the Google
31:51
antitrust cases. You're you're quite the
31:53
Renaissance man. Or either that or Or, you know,
31:58
tilting at windmills, chasing Dragons.
32:03
For the the law firms, the partners who are watching this.
32:06
Who have a vision for enacting change, right?
32:13
I I think your story is empowering and insightful for
32:18
them to understand that if you truly believe in something and
32:22
you want to make change in something, that is the power
32:25
that a single individual has. You have your bar license.
32:28
All you got to do is go and figure out like, how is this
32:31
actually happening behind the scenes?
32:33
And how can we use the system to enact change, which is listen to
32:38
the plaintiffs lawyers. They, they win a lot of money
32:40
for their clients. They help them in times of need.
32:43
But even a level beneath that, actually being able to fix a
32:47
broken system is rewarding and outlasts you, right?
32:54
You know, change in society. I think it's fantastic.
32:57
You know, it's, it's, I think that in, in and of itself is a
33:00
great take away for, for lawyers who are watching, who truly
33:03
believe in something that doesn't have an MDL wrapped
33:06
around it or doesn't have a templated process.
33:08
And you just see like this is a thing, it's opioids or it's the
33:12
newspapers, right? Or it's the coal miners to pull
33:15
on that thread and figure out how to get behind it.
33:19
And and it could become a $70 billion change the world moment.
33:23
Well, you, you never chase the money, right is what I've always
33:26
said is that is that what you chase is doing the right thing
33:30
and that doing the right thing doesn't always make you money,
33:34
but doing the right thing is always the guiding principle.
33:36
And so, you know, some people find their passion in politics,
33:40
some people find it in medicine, some find it in law.
33:43
And so if you if you keep a principled approach of I'm a
33:46
flawed man. But, well, we all are.
33:49
I'm going to do my best to try to make a difference.
33:53
And so it, it is coming small things and it's coming very
33:57
large things. You know, I've rebuilt Little
33:58
League fields. I've, I've coached Youth League
34:02
soccer teams, you know, but I wasn't the guy that stocked the
34:06
YMCA soccer team with all the little Johnny studs.
34:10
I'm the one that took the team that didn't, the kids didn't get
34:15
picked. And then I put my kids on that
34:17
team. And so I think it may be, I do
34:21
probably have a little anti authority in me a little.
34:24
I don't like bullies. But I think that's kind of what
34:28
the driving force of being what a a trial lawyer is, is standing
34:31
up for the little guy. And what happens when the little
34:34
guy's your entire hometown? Then now you have a fight.
34:37
Let's talk about the newspapers, right?
34:40
So you identified an issue with the newspaper publishers being
34:49
edged out by Google. Can you can you talk about what
34:54
you identified and how you you aggregated this group of
34:59
newspaper publishers and turned it into something larger and
35:02
more meaningful? So I think we need to start with
35:09
a casual observation about newspapers in general in, in the
35:14
early 1900s. Everybody has seen the, the
35:17
television depictions or the new of the, of the kid with the, the
35:21
newspaper bag standing on the corner.
35:24
You know, extra, extra. Read all about it.
35:27
You know $0.05 for the Daily Times, right?
35:30
Newspapers never made their money on the actual sale of the
35:33
newspaper nickels and quarters or whatever it is it cost in
35:37
different times. They made their money on
35:40
advertising and the classifieds. That's their business model.
35:45
So when the Internet tide came, it took away Craigslist and all
35:49
these other bulletin boards, took away the the classified
35:53
ads. And that was a big problem for
35:55
the newspapers. But they still had their
35:56
advertising. But nonetheless, the business
35:59
model still remained as it was, Right.
36:02
So now let me shift gears and tell you the story.
36:04
Link the story back to the Charleston Gazette and the $700
36:07
million. That newspaper article was
36:10
written by a journalist by the name of Eric Eyre Eyre.
36:15
He wrote a three-part article about the opioid epidemic in
36:18
2016, and he won the Pulitzer Prize for Journalism, the first
36:22
out of West Virginia. The.
36:24
Charleston Gazette, right? That's local newspaper.
36:30
It's a local newspaper. Won the Pulitzer Prize and
36:33
started the opioid litigation by this one individual journalist
36:39
being curious enough to ask tough questions and publish
36:43
something that got him in trouble a little bit because it
36:46
was sensitive information. So Charleston, WV back in the
36:51
day had two newspapers, a left-leaning and a right leaning
36:54
newspaper. And most people growing up
36:57
remember that two newspapers in your town, whether you're in
36:59
Iowa, Nebraska, West Virginia, there was a left and a right
37:03
leaning newspaper. Well, when the classified ads
37:07
became digital and when the digital advertising started
37:12
become prominent, newspapers began to struggle and the
37:16
Charleston Gazette and the Charleston Daily Mail tried to
37:20
merge, not sharing ideology, but tried to merge their operating
37:26
print press so that they could survive.
37:30
And the Department of Justice came in and broke apart that
37:36
merger agreement under antitrust, separated them back
37:41
out, and they both failed, right?
37:46
So I started thinking, what happens if you can figure out
37:51
how to, instead of using antitrust to destroy the 1st
37:56
Amendment and free speech in newspapers, use it to enable it.
38:00
Because what what I was learning from the owner of the newspaper
38:04
that won the Pulitzer Prize was that he's not going to be able
38:07
to survive much longer in the current environment.
38:09
And we started digging into it and researching and trying to
38:12
understand it better. So in general, without getting
38:16
into all the boring details, is Google began with the search
38:21
engine and built the search engine into the single largest
38:25
generator of advertising in the world.
38:29
And then they got tired of people clicking on their links
38:32
and going to other people's websites and spending money
38:35
somewhere else. So then they started buying
38:38
websites to bring inside their walled garden, like YouTube and
38:43
Maps and images and building the infrastructure so that people
38:49
that not only they came to the search engine, but when they
38:52
clicked on a link, they still stayed within the Google family
38:55
and generated more revenue, right?
38:59
And so you got to think about it.
39:00
It's like if you're Pampers and you want to reach out to people
39:06
that want to buy diapers, you can put a billboard up on a busy
39:10
highway and maybe catch the attention of one out of every 50
39:14
drivers. Or you can give less money to
39:17
Google. Who will say?
39:18
I will put your logo on every page that the newborn Mama goes
39:27
to. Because they have enough data to
39:30
know who those people. Are we know all the data about
39:32
these people within their walled garden?
39:34
It became a powerful advertising tool.
39:38
But that's not what the newspaper's problem was.
39:41
The newspaper's problem was Google wasn't just, they weren't
39:45
just OK with that. They were still looking at
39:47
everybody else's website that was generating clicks because
39:52
they have news. They had news aggregators.
39:54
So they were always looking at other people's websites and say
39:57
how do we capture more money there?
39:59
So what they came up with is they came up with a template
40:03
like a picture frame that goes around your website and they
40:07
sold that to companies and said. That on your website, we will
40:14
generate the advertising that goes around.
40:16
You no longer have to go out and sell your advertising to other
40:19
people. We'll generate it for you,
40:23
right? Say we'll give you a portion of.
40:27
And, and so, so if you think about this platform now is that
40:31
if you want Google to generate it for you, you have to pay
40:35
Google a portion of the the revenue you're generating.
40:39
This is double click right OK. And if you're the advertiser and
40:43
you want to go on that platform, you have to hire Google and pay
40:49
them a portion of the fee to do it.
40:51
So it's like having the stock market when Google gets paid by
40:54
the buyer of the stock and the seller of the stock.
40:57
And by the way, Google's running the Stock Exchange.
41:01
Right, they control the price. They control the price and they
41:04
get a cut left, they get a cut right.
41:07
They could have cut in the middle.
41:08
And they literally get to control it.
41:10
And then you have like the Jedi Blue where they go to Facebook
41:14
and they say, Facebook says, hey, we're going to start a
41:16
competing stock market like a NASDAQ.
41:19
And Google says, I got an idea, don't compete with us.
41:21
Instead, we'll give you preferential treatment on the
41:23
bidding process. So anyway, what ends up
41:27
happening now is the newspapers. So the newspapers have already
41:32
lost their classifieds and now they are late to the game on
41:37
digital advertising because they're still stuck on selling
41:41
ads on their printed newspapers, right?
41:45
And so they're late to the transition game and they're
41:48
trying to stay alive. So now they're going to Google,
41:51
Now they're going to and they're trying to figure out how it is
41:54
we can generate revenue, but at this point in time, there's no
41:58
way that they have tenfold increase their viewership.
42:02
They've gone from 25,000 printed copies to 250,000 hits a day,
42:08
but they're making 10% of the revenue.
42:11
The model doesn't survive. This digital advertising model
42:14
doesn't survive. Then Google does something in
42:16
addition to that is the newspapers.
42:19
In order to survive for the first time in their in the
42:22
history of newspapers, they have to go to a subscriber based
42:25
model, the paywall, right? Well, Google says to them if
42:32
you. Put up a paywall.
42:34
We're not going to list you on our news hits on our search on
42:38
our Google Machine. Because it's gated and they
42:40
can't crawl it. So you have to give us, you have
42:44
to give every independent user 10 free hits a month.
42:49
That's why when you go to Google and you click on the link,
42:52
sometimes you can read the content and sometimes you can't.
42:57
So as a result, all of these smaller newspapers, in order to
43:00
show up on Google, they have to give 10 free clicks a month or
43:04
whatever the time period is. And so when you click on the
43:08
Charleston Gazette, now you go to the Charleston Gazette, you
43:11
hit the pay wall and then what do you do?
43:13
You go back to Google, they get another round of revenue, and
43:16
then you click on the next newspaper on the same topic and
43:19
then you get the free look. Which has ads posted by Google.
43:23
Which has ads posted by Google. So if you go to the UNC School
43:28
of Journalism, North Carolina School of Journalism, they have
43:32
a map called the News Desert. And you can see on the news
43:37
desert the continued diminishment of journalism in
43:42
America. We're eventually we're going to
43:44
wind up with, you know, the New York Times and the Wall Street
43:48
Journal, right? It's like we're going to end up
43:50
with Fox and CNN, right? We are moving toward the a a.
43:55
We're going to lose more and more of our newspapers.
43:57
We're going to lose local journalism and we're going to
43:59
become a nation leading to the left or leading to the right on
44:03
national politics. How has that litigation evolved?
44:08
Because now you're talking about 2016, when this started.
44:11
We're in 2026, right? The digital landscape is very
44:14
different now than it was a decade ago, but the litigation
44:17
is still ongoing. It's expanded beyond the initial
44:19
200 publishers. It is massive.
44:22
And so the federal government has stepped in, the state
44:25
attorney generals have stepped in.
44:27
There's going to be some monumental break.
44:30
They're going to do something with Google in my humble they.
44:32
Already started like. They've already started the
44:34
dismantling. There's going to be some
44:36
fundamental separation of the walled garden from the double
44:40
click, right? And then there'll be a spin off
44:44
or something. But in the meantime, the largest
44:47
of the newspaper publishers that have aggregated, they're going
44:50
to be able to recover fractions of pennies on a click multiplied
44:56
by billions of clicks that are going to recover.
44:59
But the fractions of the pennies of the click recovery that
45:01
happens at antitrust is not going to be enough to save local
45:04
journalism. There's going to have to be a
45:06
new evolution of journalism that survives the collapse of our
45:11
local newspapers across America. Are you working with Zeke Derose
45:16
and the Lanier firm on on these cases as well?
45:21
I, I have been the, the, the we've shared a lot of
45:24
information. They're operating at a much
45:26
higher level, at a much bigger level, a much more important
45:28
level. They're going to impact national
45:31
policy. I'm just trying to save a couple
45:33
of newspapers. How do you think that the those
45:36
publishers and and any publisher on the web now, right?
45:39
Like news is, I don't want to say it's commoditized right now,
45:42
but like I can go to the beach and I could film, you know,
45:45
something that happens like that becomes news.
45:47
Like everybody is a media outlet.
45:49
But when you have someone like like Google or Open AI who is
45:54
ingesting all of this and then providing the summarized
46:01
responses on their own platforms, at some point there's
46:05
a break with the publishers and the creators, the news media
46:09
outlets, where if they're not getting the clicks, they're not
46:12
generating the revenue. They are now they just ingest
46:14
all the news and they serve it up and that response and make it
46:17
so that you don't get any ad revenue because they never even
46:20
go to the site it. It it potentially turns from a
46:23
news desert into a complete creation desert, a publisher
46:26
desert where new content isn't being created created because
46:29
there's no incentive to do so. I think did Elon Musk have
46:34
something he, he had an every man kind of platform of every
46:38
man can be their own journalist. You know, his idea was that news
46:42
is going to be created on the ground by individuals.
46:45
Well, that was kind of why he bought Twitter and turned it
46:47
into X The keep it to keep it a a a public town hall that anyone
46:51
could publish on that isn't regulated.
46:53
That's the the idea. Well, you know, my biggest
46:57
concern is that what we're going to lose is we're going to lose
47:01
the local journalist who is, you know, has enough courage to
47:06
write an article about 700 million pills that effectuates
47:13
change. And so, you know, to me, maybe
47:17
I'm just old enough now to be old school.
47:20
Professional journalism is important in America for
47:23
visibility, transparency, accountability.
47:26
And maybe what ends up happening is we have a couple of
47:30
influencers that have enough credibility that they can report
47:33
on the news accurately and that people trust them.
47:36
But there is going to be a seismic change, especially with
47:39
AI, with the news aggregators. But as long as Google maintains
47:43
its stranglehold on the largest monopoly ever created it in the
47:47
world, you know the digital revenues going to still flow in
47:50
One Direction. Do you think?
47:53
That it's a a calculated play by Google to keep ads out of Gemini
48:01
right now. So, you know, what we're talking
48:05
about is we're talking geopolitical strategy, right?
48:09
We're talking about the largest companies in the world.
48:12
It's like the same thing when you're talking about, you know,
48:15
Chinese, Russia and America and, you know, policy positions on on
48:20
their power struggle. This is no different.
48:22
These are corporations in an amoral setting.
48:26
And I don't mean immoral, I mean amoral in the absence of
48:30
morality. These are corporations acting in
48:33
some type of business enterprise of gross and, and survival.
48:38
And so, you know, Google has its own AI strategy.
48:44
I think everybody does. I think it's just they're going
48:47
to hold on to, they're going to hold on to what they have for as
48:49
long as they can until the Department of Justice antitrust
48:53
division gets involved. What do you think the landscape
48:55
looks like 5 to 10 years from now?
48:59
I have no idea. It's still, it's still, I mean,
49:03
with AI in the legal world, I just, I can't fathom AI is going
49:07
to replace thinking lawyers, just like I can't envision AI
49:10
replacing thinking journalists or thinking doctors.
49:14
But you know, the world, the world is quickly evolving.
49:18
The technology. It's, it's what we've learned
49:22
from the social media stuff, right, Is that there are
49:25
patterns to the way the human brain thinks and it can be
49:29
influenced by the way in which we feed it information.
49:33
And that's scary. Elon Musk in a a recent
49:37
interview I saw him in a paraphrase, he said he was asked
49:41
about AI eating jobs and and replacing humans and he said
49:50
that the last frontier of AI replacing humans is in the real
49:57
world, right like physical interactions, right Paul John,
50:03
can you replace me with an AI? No can I use AI to help me
50:08
understand your background quicker to help prepare for this
50:11
interview better Sure that could be done but there is not a robot
50:15
that can sit here powered by AI that can actually have real
50:19
world interactions. We're here at mass towards
50:22
Puerto Rico, having real human interactions.
50:24
And until there is some way that no one can really conceptualize
50:30
right now of what the future will look like, where where AI
50:32
actually integrates itself into like physical manifestation,
50:36
that is the last frontier that I think we have to hold on to real
50:40
people, real interactions, doing real things assisted by AI.
50:45
That's OK. Here's the interesting thing,
50:47
right? You and I can't replace the
50:51
connection we've just had, right?
50:53
The three of us that had a conversation, we've connected,
50:57
we've we've spoken our minds and our hearts.
50:59
We've had an experience that can't be replicated by machines.
51:03
Yeah, I can't replicate the feeling I had when you said like
51:05
700 million pills. But I'll tell you what you could
51:08
do is you could probably ask AI to generate a fictional panel to
51:13
show on a on a on ATV screen to other people that have the
51:19
impact on other people, right? Is AI can figure out what
51:23
combination of interaction works best in a podcast with enough
51:27
emotional connection that it makes somebody feel something
51:31
watching it on a television screen.
51:33
But it can never replace our personal interaction here today
51:37
and. We'll never replace this
51:39
conversation. This is awesome.
51:42
This is great. I love learning about your
51:44
background and. Fascinating.
51:47
The change that you've already enacted and continue to enact in
51:52
this country is absolutely fucking incredible.
51:56
Thank you for the work that you continue to do for this country
51:59
and, and I really appreciate you joining us on the show.
52:02
Thank you. Thanks, Paul.
52:04
Awesome. Paul, Farrell.
52:05
Farrell and Fuller. Hi, I'm Paul Farrell Junior of
52:08
Farrell and Fuller. I'm on the John and Mark
52:11
podcast. It's subscribing like.