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Johnson & Johnson Ordered to Pay $572M in Landmark Opioid Case; Tropical Storm Dorian Heads Toward Caribbean; Sen. Elizabeth Warren Drawing Big Crowds at Rallies. Aired 6-6:30a ET

Aired August 27, 2019 - 06:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

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UNIDENTIFIED MALE: Johnson & Johnson, motivated by greed and avarice, is responsible for the opioid epidemic in our state.

[05:59:12] UNIDENTIFIED FEMALE: A landmark decision and success for the state of Oklahoma.

SANJAY GUPTA, CNN MEDICAL CORRESPONDENT: For a long time these drug companies have been saying we weren't to blame here. This ruling suggests that that's not the case.

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: From the moment we got here we've been treated beautifully.

JIM ACOSTA, CNN CHIEF WHITE HOUSE CORRESPONDENT: Throughout this G-7 summit the president and his team offered conflicting and false statements on a whole range of topics.

UNIDENTIFIED FEMALE: He continues to diminish U.S. credibility by his erratic and unpredictable behaviors.

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ANNOUNCER: This is NEW DAY with Alisyn Camerota and John Berman.

ALISYN CAMEROTA, CNN ANCHOR: We want to welcome our viewers in the United States and around the world, this is NEW DAY, it is Tuesday, August 27, 6 a.m. here in New York.

And we begin with a landmark legal judgment in the opioid crisis. A judge in Oklahoma ordering pharmaceutical giant Johnson & Johnson to pay $572 million for its role in fueling the opioid crisis that has ravaged that state, leading to thousands of deaths.

This is the first time a judge has held a drug maker culpable for the impact of these painkillers. The company plans to appeal.

JOHN BERMAN, CNN ANCHOR: And we have breaking weather news this morning that could affect millions of Americans. Moments ago, the National Hurricane Center issued a tropical storm warning and hurricane watch for Puerto Rico. You can see right there what they're worried about. It's Tropical Storm Dorian. The island's new governor has declared a state of emergency as Puerto

Rico prepares for a direct strike. That could happen tomorrow. As you can see there, Florida is now in the cone for potential landfall as well. We have Chad Myers looking through the new data. He will track the storm for us and give us a forecast moments from now.

But first, we're going to be with CNN's Alexandra Field, live in Norman, Oklahoma. And Alexandra, this is an historic judgment in the opioid crisis.

ALEXANDRA FIELD, CNN CORRESPONDENT: A landmark decision, John. Look, Oklahoma says that the opioid crisis has claimed some 6,000 lives. They went after Johnson & Johnson for $17 billion. They won just a fraction of that, but the victory could have implications across the nation.

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JUDGE THAD BALKMAN, CLEVELAND COUNTY DISTRICT, OKLAHOMA: I am entering an abatement plan that consists of costs totaling $572,102,028.

FIELD (voice-over): A landmark decision worth over half a billion dollars with an Oklahoma judge ruling Johnson & Johnson bears responsibility for the state's opioid epidemic.

BALKMAN: The defendants caused an opioid crisis that is evidenced by increased rates of addiction, overdose deaths and neonatal abstinence syndrome in Oklahoma.

FIELD: After a trial more than seven weeks and dozens of witnesses taking the stand, Judge Thad Balkman ruling the drug manufacturer "engaged in false and misleading marketing of both their drugs and opioids."

BALKMAN: Those actions compromised the health and safety of thousands of Oklahomans.

FIELD: Prosecutors praising the judge's decision as more than 2,000 similar lawsuits have been rolled into one federal trial, slated for this fall, seeking similar outcoming outcomes against drug manufacturers, with the opioid epidemic devastating communities nationwide.

MICHAEL HUNTER, ATTORNEY GENERAL, OKLAHOMA: We have proven that Johnson & Johnson built its billion-dollar brand out of greed and on the backs of pain and suffering of innocent people.

FIELD: Johnson & Johnson writing in a statement it's "confident it has strong grounds to appeal this decision," adding, "The decision in this case is flawed."

SABRINA STRONG, ATTORNEY, JOHNSON & JOHNSON: Today's decision reflects a radical departure from more than a century of case law in this state. FIELD: In 2017, the state sued Johnson & Johnson, along with other

drug manufacturers, Purdue Pharma and Teva Pharmaceuticals, saying they aggressively marketed opioids to doctors and downplayed the addictive nature of their products. Both Purdue and Teva settled for a total of more than $350 million, now giving Oklahoma nearly $1 billion to put towards treatment and prevention programs.

HUNTER: We're happy with the verdict. Obviously, we would have liked more, but we're very happy with the judge, again, finding that Johnson & Johnson was culpable for what's happened in Oklahoma.

(END VIDEOTAPE)

FIELD: Teva and Purdue have both said that they committed no wrongdoing.

The federal trial is set to start in October to further determine whether big pharmaceutical companies will be held responsible for fueling the opioid epidemic. So John and Alisyn, this decision in Oklahoma, the first of its kind, could really be just the beginning.

CAMEROTA: It sounds like it. Alexandra, thank you very much for all of that reporting.

Joining us now with legal analysis, we have CNN legal analysts Paul Callan and Elliot Williams, who's the former deputy assistant attorney general. Great to have both of you.

So Paul, Alexandra referred to this as landmark, as are so many people this morning. So what's the significance of what just happened?

PAUL CALLAN, CNN LEGAL ANALYST: Alisyn, it's an absolutely landmark decision, because there are thousands of litigants across the country bringing similar suits.

This is the first time a pharmaceutical company -- and it's a big one -- Johnson & Johnson and its subsidiary, Janssen, has been held liable for damages caused by drug overdoses, which were caused, say the state of Oklahoma, by misleading advertising relating to oxycontin and other pain-killing medications.

BERMAN: The way, Elliot, though, that the plaintiffs went after this case and the way that the judge ruled is based on a legal theory public nuisance, which we're used to hearing, you know, your dog is barking too loud. That's a public nuisance, not there's a major opioid crisis here. How might that play into whether or not this is the beginning of something much larger?

ELLIOT WILLIAMS, CNN LEGAL ANALYST: I think it will play into something -- the beginning of something much larger.

Look, even under the best of circumstances, Johnson & Johnson would have appealed the decision. That's their right as a litigant. But what you've got here, just as a touchstone, John, is it's a novel legal theory. It's often -- this public nuisance concept comes up in access to public waterways and so on. [06:05:15] Now, in the tort context, it came up with the tobacco cases

years and years ago. So it's entirely possible to sue an entity, a business entity for creating a public nuisance. But this is the first time we're seeing it with a drug company.

And so future courts, appeals courts are going to look very closely at this decision, and this certainly isn't the end of it. We're going to see a lot of appeals that are going to take a long time to sort out what -- you know, how far you can stretch the law on this very -- this new legal concept.

CAMEROTA: Paul, Johnson & Johnson is appealing, of course, and according to the court documents, they provided 1 percent of the prescription opioids in Oklahoma. So why are they shouldering the whole burden, and how strong do you think their case on appeal is?

CALLAN: Well, I think they do make a strong case here, but the judge in Oklahoma basically found that they had flooded the market through advertising with opioids and that they -- they led to possibly as many as 6,000 deaths in the state of Oklahoma. That was the claim that was made by the attorney general's office.

And a lot of people would say, "Well, why would that be -- why would the state be damaged by drug overdoses, as opposed to the individual family members?" Well, the state has to fund medical care for people who overdose, and there are a variety of damages that the state of Oklahoma has endured.

Defense attorneys said it's ridiculous to blame Johnson & Johnson for all of these deaths, and the judge compromised, I think, and came down with a slightly lower damage award.

BERMAN: One reason why Johnson & Johnson did this, or it's happening to Johnson & Johnson, is they're the only company that took it to trial. Other companies settled before a judge could reach a verdict there.

Elliot, I guess there are a couple of questions here. No. 1, why the drug company and not doctors? Doctors are the ones actually prescribing the medications. How come they're not part of this lawsuit? And then how does this become something bigger that potentially impacts the entire opioid crisis?

WILLIAMS: Well, OK, so taking your second question first, there's another massive case coming in Cleveland, Ohio. This fall, we were talking about 2,000 cases are brought together, nation -- touching literally, I believe, every municipality in the United States.

And so certainly, this was just one trial, as you've touched on, but there are so many more to come. And frankly, we're likely to see settlements. Now that you've seen someone lose at trial, other future parties are going to have an incentive to settle. Right?

Now, as to why not doctors, this is exactly, precisely the point that Johnson & Johnson tried to hide behind. They specifically had said, because these drugs are prescribed by trained professionals, we shouldn't be held liable at all.

Now, look, in some of these other trials, not just the drug companies, retailers and distributors are also being sued. So again, this was just one small subset of what you're going to see. You're just going to see a lot of litigation over the rest of this year and beyond, so this isn't going away anytime soon.

CAMEROTA: But Paul, do you think they make a good argument that, really, doctors are on the forefront of this and that they should be held as responsible?

CALLAN: Well, they make the argument that the FDA approved this drug as an effective pain-killing medication used for proper purposes and that the drugs are prescribed by physicians. So why should we, the pharmaceutical companies, be held responsible?

However, if you look, for instance, to an analogous situation, the tobacco litigation, you remember similar kinds of arguments were used for many years against the tobacco companies, and they won. In the end, though, they lost big-time, for millions and billions of dollars.

And I think that's what the big fear is here among major pharmaceutical companies. This is a precedent that they're going to get nailed, especially when they get in front of juries. This was a judge trial, and so the verdict was a little bit over $500 million. Watch what happens when a jury with a lot of sympathy for all of these families get -- get their hands on this case. Monster verdicts down the road here.

BERMAN: Which is why it may never get to a jury in some cases, because these companies may choose to settle. And we should note, this case in Ohio, the huge federal case begins, what, in October?

CALLAN: Yes.

BERMAN: So it will all happen very soon.

CALLAN: Yes. And there are cases pending in New York, I will tell you, that have been filed on behalf of counties throughout New York state and unions and other entities that were damaged by these horrible opioid deaths and this epidemic.

BERMAN: Paul Callan, Elliot, thank you very much for being with us this morning.

And coming up in our next hour, we are going to speak to attorneys on both sides of this case. Sabrina Strong, who represents Johnson & Johnson, and Brad Beckworth, who led the state of Oklahoma, who led -- was one of the lead plaintiffs on the other side.

CAMEROTA: All right. Meanwhile, we have breaking weather news. Puerto Rico and part of the Dominican Republic are now under a tropical storm warning and hurricane watch as Dorian gains strength. It could hit Puerto Rico as a hurricane tomorrow. And it is forecast to be off the Florida coast by the weekend. [06:10:06] CNN meteorologist Chad Myers has been tracking all this for

us. What do the latest storm tracks show, Chad?

CHAD MYERS, CNN AMS METEOROLOGIST: Well, the good news overnight, the Hurricane Center says it will be a tropical storm for its entire length in the Caribbean, which is down here.

Yesterday they had it turning into a Category 1 hurricane. And that is still possible. I mean, the -- the numbers are 70 miles per hour. You get to 75, and it's a hurricane, so do not let your guard down here.

The storm did not gain any strength overnight, although it did hit Barbados with winds at about 60 to 65 miles per hour. Right now, it's a 50 mile-per-hour storm because of that interaction with the island.

But look at the track. The track takes it very close to Punta Cana, or not that far from Ponce, in the -- in the Dominican Republic and also into Puerto Rico. This is the area that we're going to watch for that eye core, that center, if it develops.

But after that, by Sunday, it makes a run at Florida. This will turn back to the left, and not a big right-hand turn like sometimes we see. The models are taking it back toward the left and into the Florida east coast, so we're going to have to watch that. Could be anywhere from the Keys to Jacksonville. By the time the models get that far out, the air, plus or minus, is 200 miles. So keep that in mind.

One good thing, on the south side, if we don't get the wind in Ponce and in Puerto Rico, we will see a drought that is now extreme finally get a little bit of relief, John. A lot of these tropical systems that only are 50 or 60 miles, bring that rainfall that the tropical islands need in the summer time.

So here it goes, making a very close approach to Florida. We'll watch that by the weekend. It could be a bigger storm. The water in the areas around the Bahamas, 85, 90 degrees; and that's the fuel to the fire to maybe get it bigger. Can't keep your eyes off this one.

BERMAN: All right. Chad Myers, stand by. Keep your eye on this all throughout the morning. We'll check back with you in a little bit.

And we should note we'll have a live report from Puerto Rico coming up very shortly.

Beyond that, are we waking up to an entirely new Democratic race for president? The new poll that has the political world buzzing. Should it be buzzing quite as big as it is about this? It comes as Senator Elizabeth Warren attacks these huge crowds. What do these tell us? Next.

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[06:16:54] BERMAN: So this morning, one new national poll shows a big change at the top of the race for the Democratic nomination. Now, it is just one poll, but the new Monmouth poll shows this three-way race among senators Bernie Sanders and Elizabeth Warren and former Vice President Joe Biden. This is the first poll to really show Biden as part of the pack.

There is more momentum in polls for Elizabeth Warren. Look at these crowds she's been drawing: 15,000 people, her campaign says, in Seattle this past weekend. They say she drew another 12,000 in Minnesota last week.

Joining us now, CNN political analysts David Gregory and Sarah Isgur; and Joe Lockhart, former Clinton White House press secretary and CNN political commentator.

All the caveats -- just one poll, the margin of error is plus or minus around 6 percent, which means that Biden could still have a 12-point lead. However, if your whole campaign is based on electability and the fact, David, that you are the most assured in your argument to win the race, a poll that doesn't show you necessarily winning, how problematic is that?

DAVID GREGORY, CNN POLITICAL ANALYST: I think it is problematic. This is about enthusiasm. You know, it's why we have campaigns. People actually start showing up and listening to what the candidates are saying, not just what they perceive the strengths and weaknesses of the candidates are. It's why the debates matter, as well.

And I think what Elizabeth Warren is showing is a couple of things. One, there's a lot of enthusiasm among the progressive ranks of the Democratic Party. There's a lot of sorting out that Democrats are trying to do about what's a winning strategy, what kind of party that it wants to be moving forward. And I think she and Bernie Sanders are tapping into that.

But I think she's doing something pretty smart by reaching out to donors, by protecting her left flank, but also saying, "Look, I've campaigned for Democrats across the country. I've helped Democrats win. I really see a future for the whole Democratic Party."

And I think that Biden has to -- has to keep showing up and do something about some of the lack of enthusiasm he sees in certain quarters. I have always thought there's going to be this kind of moderate track and the progressive track, and they're both going to be real strong for a long time.

CAMEROTA: Sarah, it's very interesting what David brings up, which is that behind the scenes, at least, she is making the argument that she -- Elizabeth Warren -- that she is not a radical choice. She is a practical choice. And that she brings in the crowds and she can bring in money and that that has a ripple effect to other Democrats. And I mean, just based on her crowds, people are very interested in what she has to say at the moment.

SARAH ISGUR, CNN POLITICAL ANALYST: It's why polls like this can be so deadly for a frontrunner like Joe Biden, because it gives Elizabeth Warren exactly what she needs, that opening on viability as a candidate. So many people at this point in a race are really backing the

frontrunner, because they're the frontrunner because that's who's going to win. And they may have a preferred candidate but don't think that preferred candidate has a real route to the nomination.

A poll like this, whether it's right or wrong, frankly, David's exactly right, it's about perception. And if the perception is that there's a pack, and there are other options. And voters really get to start to say, "Well, wait, who's actually my favorite candidate?" And that's where Elizabeth Warren has really seized her moment here in saying, "I'm a viable candidate for this nomination. Just you wait."

[06:20:12] BERMAN: Yes. Voters are looking for a permission structure, that argument goes, to vote for the candidate that their heart is telling them to vote for.

Joe Lockhart, I'm old enough to remember when Howard Dean was drawing 10,000 people and he was assured to be the Democratic nominee in 2004. Likewise, I'm old enough to remember when Donald Trump was drawing 10 or 15,000 people in 2016, and people told me it didn't matter. So which is it?

JOE LOCKHART, CNN POLITICAL COMMENTATOR: Well, I mean, they're both right. It matters, and it doesn't matter.

I think Elizabeth Warren is going through kind of a period that we saw with Bernie Sanders in 2017, where lots of crowds, lots of young people.

But there are a series of caveats that we should go through. One is the poll is a very small sample size. But you know, it's going to get a lot of attention, so it matters.

Second is Elizabeth Warren, you know, has not been seen as the frontrunner and has not really been attacked. We're going to have to see on the next debate stage how she defends the idea of abolishing private health insurance. I think that's a very unpopular idea, and it hasn't been tested very much with her.

Enthusiasm matters particularly in the caucus states. So in Iowa that matters a lot. It matters a lot less, I think, in the primaries.

The last thing is -- and I haven't seen the insides of the poll -- Warren's path to the nomination has to go through some traditional Democratic constituencies, particularly African-Americans and non- college educated whites. And she doesn't in the previous polls, particularly the CNN poll, you don't see a lot of support for her there. If she can breakthrough, then she might become the legitimate frontrunner.

GREGORY: Can I --

CAMEROTA: Go ahead.

GREGORY: There's one bit of skepticism there that I want to underline from Joe, which is what happens in the -- in the process of the primary fight, where other Democrats say to her, "Look, your ideas, they may get a lot of smiles in these early states, but we have to think about how they're going to square with Trump and what Trump is going to say about, you know, quote unquote, 'radical leftist ideas.'"

And there's anecdotally of course, but you talk to people who are Trump supporters who may disagree with lots of what he does. They don't like the alternative. And we have to remember this is going to get to a stage in a general election where it is an alternative. It's not simply a referendum on Trump.

And I think that's where, to the point about the debates, that's where you're going to want to see some Democrats say is this really something that's going to be viable when we get to a national election?

CAMEROTA: I suppose. I mean, Sarah, you know, people are saying that at her rallies, there's a chant that's emerged, which is "2 cents," "2 cents." Because maybe it's not that radical for people to think that the billionaires and the wealthiest among us and corporations should pay 2 extra cents on the dollar. I mean, maybe you know, at first, some of the things she was saying sounded like, you know, because nobody else had said them, it sounded radical. But maybe people are starting to respond to those things.

ISGUR: Well, you set aside some of the details of the policies, and voters in general, actually don't like candidates who run to the far extremes very often.

But I think we've also seen at the debates, to David's point on how important those can be, where Senator Harris had had a great run. She was surging and then kind of fell apart in the debate when she was pushed as a quasi-frontrunner, a quasi-surging candidate. To exactly what Joe said. Can Elizabeth Warren, when she's the frontrunner, when she's surging, take it to the debates? She's a Harvard law professor we'll see.

Berman: Spoken like a Harvard Law grad.

Let me put two -- let me put two graphics up on the screen. First, I just want to show you this poll compared to the other polls, so you can see. You hear the phrase "outlier." This poll is different than other polls. Other polls do show Joe Biden with a fair lead here. That's from 202.

CAMEROTA: She has been consistent with a 20.

BERMAN: She's at 20. She appears to be at 20, really at almost everything. He in the other polls is generally higher.

The other screen, Joe, and this is where I want to shift to, is the ten candidates who will likely be on the Democratic debate stage next, the ABC debate. It will just be ten, it looks like, right now. One debate. And to the point that you've all been making, who among these ten is going to take it to Elizabeth Warren? If someone is going to stand up to her and say, "Your ideas aren't realistic," if that's the argument they want to make, who will it be? LOCKHART: Well, I think, certainly, Joe Biden will be one, and I

think you saw a little bit of it in the last debate. She wasn't on the same stage with him.

I think the rest of the field will go after this idea that eliminating private insurance is a somewhat radical idea, is something that will help Donald Trump and the Republicans and, you know, I think she'll bear the brunt of it.

[06:25:03] You know, I think she's been smart in trying to make sure that the, you know, so-called establishment in the party gets normalized to her.

If I were her, I would remind people in the 2016, she was for Hillary Clinton, not Bernie Sanders. But I do expect there to be -- the next debate to not just be everyone aiming at Joe Biden. I think they'll be aiming at Joe Biden and Elizabeth Warren.

CAMEROTA: OK. Joe, Sarah, David, we're out of time. Thank you very much.

BERMAN: You heard the David Gregory nod of affirmation there.

CAMEROTA: Good, thank you.

BERMAN: People can take that into break.

CAMEROTA: People can -- can interpret that how they'd like.

All right. Meanwhile, we could potentially learn more about President Trump's tax returns today. Two banks could be forced to reveal what they know. That's next.

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CAMEROTA: Two major banks, Deutsche Bank and Capital One, have until 4 p.m. Eastern to tell a New York court whether they have President Trump's tax returns. If they refuse to answer.

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