By Brendan Pierson

Jan 28 (Reuters) - A West Virginia city and county on Tuesday urged the state's top court to revive their $2.5 billion lawsuit accusing the three largest U.S. drug distributors of fueling the opioid epidemic, asking it to rule that opioid sales can give rise to a public nuisance under state law.

The city of Huntington and its county, Cabell, in 2022 lost their case against Cencora COR.N, Cardinal Health CAH.N and McKesson MCK.N following a non-jury trial. They claimed that the companies sold an excessive amount of pills in the region while ignoring red flags that they were being diverted into illegal channels, resulting in an epidemic of addiction and overdose deaths.

U.S. District Judge David Faber in Charleston ruled that the conditions caused by legally selling prescription drugs could not be the basis for public nuisance claims. After the city and county appealed that ruling, the 4th U.S. Circuit Court of Appeals asked the West Virginia Supreme Court to decide whether public nuisance claims in the state could extend to opioid sales or not.

If the court rules that they cannot, Faber's ruling will stand. If it rules that they can, the case will go back to the 4th Circuit, which could decide the merits of the case or send it back to Faber.

"This court's cases have long held that public nuisance is a flexible doctrine," David Frederick, a lawyer for Huntington and Cabell told the court on Tuesday. He said that the public nuisance claim concerned "not just the sale of a product, but the manner of distribution of a highly addictive drug," and that the distributors had ignored their obligation under federal law to watch for red flags that drugs were being diverted to the black market.

Steven Ruby, representing the companies, said allowing the public nuisance claims "will create an avalanche of activist litigation."

"Public nuisance becomes the monster that devours the entire law of tort," he said, arguing that any harmful product could be said to create a public nuisance by burdening the public health system.

The five-member court did not clearly indicate how it would rule.

The case was one of the first of thousands of similar public nuisance lawsuits filed by state, local and Native American tribal governments against drugmakers, distributors and pharmacies over the opioid crisis. While most of the cases that went to trial were unsuccessful, the litigation has resulted in more than $50 billion in settlements.

The state of West Virginia has obtained more than $1 billion in opioid settlements, including $400 million from the three distributors, the largest amount per capita of any state. Huntington and Cabell cannot get any funds from the distributor settlement because they chose to go to trial against them.

Public nuisance claims have traditionally been used in cases involving conduct that interferes with a public right, such as obstruction of a public road or dumping waste on public land or water. Rather than allowing injured plaintiffs to seek damages to compensate them for their injuries, it allows courts to order responsible parties to abate the nuisance.

The opioid litigation is one of several recent efforts to expand the doctrine to include a wider range of claims, along with lawsuits over more general environmental pollution.

The case is City of Huntington v. AmerisourceBergen, Supreme Court of Appeals of West Virginia, No. 24-166.

For petitioners: Paul Farrell of Farrell and Fuller; and David Frederick of Kellogg, Hansen, Todd, Figel & Frederick

For respondents: Steven Ruby of Carey Douglas Kessler & Ruby

Read more:

4th Circuit sends West Virginia city's opioid case to state's top court

West Virginia cities reach $400 mln opioid distributor settlement

U.S. drug distributors prevail in $2.5 billion West Virginia opioid case

(Reporting By Brendan Pierson in New York)