In this March 31, 2020 file photo, a woman pulls groceries from a cart to her vehicle outside of a Walmart store in Pearl, Miss. Walmart is teaming with the General Motors' Cruise autonomous vehicle unit to test automated package delivery in Arizona. (AP Photo/Julio Cortez, File)
By Michael Balsamo and Ann D'Innocenzio
The Justice Department is suing Walmart, alleging the company unlawfully dispensed controlled substances through its pharmacies, helping to fuel the opioid crisis in America.
The civil complaint being filed Tuesday points to the role Walmart’s pharmacies may have played in the crisis by filling opioid prescriptions and by unlawfully distributing controlled substances to the pharmacies during the height of the opioid crisis. Walmart operates more than 5,000 pharmacies in its stores around the country.
The Justice Department alleges Walmart violated federal law by selling thousands of prescriptions for controlled substances that its pharmacists “knew were invalid,” said Jeffrey Clark, the acting assistant attorney general in charge of the Justice Department’s civil division.
Federal law required Walmart to spot suspicious orders for controlled substances and report those to the Drug Enforcement Administration, but prosecutors charge the company didn’t do that. Walmart couldn’t immediately be reached for comment.
“Walmart knew that its distribution centers were using an inadequate system for detecting and reporting suspicious orders,” said Jason Dunn, the U.S. attorney in Colorado. “As a result of this inadequate system, for years Walmart reported virtually no suspicious orders at all. In other words, Walmart’s pharmacies ordered opioids in a way that went essentially unmonitored and unregulated.”
The suit alleges that Walmart made it difficult for its pharmacists to follow the rules, putting “enormous pressure" on them to fill a high volume of prescriptions as fast as possible, while at the same time denying them the authority to categorically refuse to fill prescriptions issued by prescribers the pharmacists knew were continually issuing invalid prescriptions.
AP reported the news of the lawsuit ahead of the Justice Department's public announcement, citing a person who could not discuss the matter publicly before the announced move. The person spoke to the AP on condition of anonymity.
The Justice Department’s lawsuit comes nearly two months after Walmart filed its own preemptive suit against the Justice Department, Attorney General William Barr, and the Drug Enforcement Administration.
In its lawsuit, Walmart said the Justice Department’s investigation — launched in 2016 — had identified hundreds of doctors who wrote problematic prescriptions that Walmart’s pharmacists should not have filled. But the lawsuit charged that nearly 70% of the doctors still have active registrations with the DEA.
Walmart’s lawsuit alleged the government was blaming it for the lack of regulatory and enforcement policies to stem the crisis. The company is asking a federal judge to declare the suit has no basis to seek civil damages. That suit remains ongoing.
The initial investigation was the subject of a ProPublica story published in March. ProPublica reported that Joe Brown, then U.S. attorney for the Eastern District of Texas office, spent years pursuing a criminal case against Walmart for its opioid prescription practices, only to have it stymied after the retail giant’s lawyers appealed to senior officials in the Justice Department.
Two months later, Brown resigned. He didn’t give a reason for his departure except to say he would be “pursuing opportunities in the private and public sectors." Brown went into private practice in the Dallas area.
Updated on December 22, 2020, at 3:44 p.m. ET with additional details.
Housing has been one of the bright spots in the broader economy in 2021, as Americans borrowed more than ever to buy homes. Mortgage lenders issued an estimated $1.61 trillion in purchase loans this past year with sales of existing homes expected to reach their highest level since 2006. Orla McCaffrey, reporter at The Wall Street Journal, joins Cheddar News.
Brian Walker, Chief Strategy Officer at Bloomreach, breaks down the impact returning gifts have on retailers and how stores can benefit from the rise in ecommerce.
Events and media company Emerald X has acquired Colorado-based news company Marijuana Business Daily for $120 million, which includes the live business conference, MJBizCon. David Doft, chief financial officer at Emerald X, and Chris Walsh, CEO at MJBizDaily, joined Cheddar to talk about the deal and what it means for the growth of the legal cannabis industry. As cannabis becomes more mainstream, Walsh noted that part of the industry's growth will come from major corporations that now "feel more comfortable" conducting business with the industry.
General Motors rolled out the newest addition to its EV fleet with the all-electric Silverado pickup truck. Deborah Wahl, chief marketing officer at GM, joined Cheddar to talk about the latest EV offering and how it matches up to its past gas-powered versions. She said she expects demand to soar after the "first-level truck" sold out in just 12 minutes and talked about steps GM plans to take to regain its title as top U.S. auto seller after being dethroned by Toyota in 2021 with emphasis on the EV market. "I think this is an exciting new inflection point for the market overall, for [an] idea of an all-electric future, and certainly shows that we're extremely committed to the idea of everybody in an electric vehicle," said Wahl.
With the annual CES convention underway amid COVID, HP unveiled rolled out a number of new products virtually this year, including new gaming PCs and 4K display monitors. But as industries look toward a greener future, HP is working with the climate crisis in mind. James McCall, chief sustainability officer at HP, joined Cheddar's Kristen Scholer to discuss the company's climate goals, which includes reducing its carbon footprint to net-zero by 2040. He admitted that reaching the ambitious goal will be difficult because much of the company's emissions totals come from third parties. "A large part of our footprint is outside of HP's direct control. A lot of it comes either from our incoming supply chain, the materials, our manufacturing process, or about 30 to 40 percent of it comes from our consumer-use base," McCall told Cheddar.
Jared C. Bass, senior director for Higher Education at the Center for American Progress, joins Cheddar News to discuss how schools are navigating the Omicron variant.
Martin Fischer, president of technology supplier for cars and commercial vehicles ZF North America, joined Cheddar to discuss the company's solutions for next-generation mobility in autonomous vehicles and its plans to usher in the next phase of electric vehicles. He also talked about the rising demand for self-driving technology on a global scale. "Whereas we are really active also there for passenger cars and commercial vehicles, what we showcase at CES now virtually is our autonomous shuttles," he said. "So, what that means is we bring these vehicles to busy city centers and can take traffic levels down."
