"[Walgreens] did not maintain an effective system for identifying suspicious orders," Breyer wrote. "It shipped thousands of suspicious orders to its pharmacies without investigation. In 2012, the DEA shut down one of Walgreens' three controlled substance distribution centers because the distribution center's failure to monitor for suspicious opioid orders posed an imminent threat of harm to public health and safety. Shortly thereafter, Walgreens stopped distributing opioids all together."

Breyer said the evidence at trial showed that tens of thousands of prescriptions dispensed through Walgreens were written by doctors with suspect prescribing patterns. The city also demonstrated at trial that Walgreens did not provide pharmacists with sufficient time, staffing, or resources to perform due diligence on these prescriptions, according to the judge.

"Pharmacists experienced constant pressure to fill prescriptions as quickly as possible, and a shortage of resources to review them before dispensing," he wrote. "As a result of Walgreens' fifteen-year failure to perform adequate due diligence, Plaintiff proved that it is more likely than not that Walgreens pharmacies dispensed large volumes of medically illegitimate opioid prescriptions that were diverted for illicit use and that substantially contributed to the opioid epidemic in San Francisco." 

A representative for Walgreens said the company is disappointed with the outcome of the trial. "The facts and the law do not support the court's decision. As we have said throughout this process, we never manufactured or marketed opioids, nor did we distribute them to the 'pill mills' and internet pharmacies that fueled this crisis," the spokesperson said.

The Walgreens representative said the plaintiff's attempt to resolve the opioid crisis with "an unprecedented expansion of public nuisance law is misguided and unsustainable. We look forward to the opportunity to address these issues on appeal."

Chiu's outside counsel in the case included Lieff Cabraser Heimann & Bernstein; Robbins Geller Rudman & Dowd; Renne Public Law Group; Andrus Anderson; Sanford Heisler Sharp; Casey Gerry Schenk Francavilla Blatt & Penfield; and Weitz & Luxenberg.

During a news conference Wednesday, Chiu said the opioid crisis did not manifest out of thin air—it was created by the opioid industry. Walgreens "flooded our city with opioids," he said, and then shifted the blame of closing stores in San Francisco because of the condition of the streets.

Louise Renne, of Renne Public Law Group, said in a phone interview Wednesday that Breyer's decision is important because it clearly lays out how the opioid crisis morphed from pills to heroin and fentanyl, resulting in an increased number of overdoses and deaths. Renne said she hopes the litigation will affect the multidistrict litigation, which she's also involved in, where over 3,000 cities and local governments have filed lawsuits.

Renne said Walgreens, which has been an outlier in the litigation as many of the other defendants have reached settlement agreements, might "come to its senses."

"I think all of us are hoping in many ways this litigation is moving toward its end," she said. "This litigation has been going on for almost six years, sometimes even longer."

Paul Geller of Robbins Geller Rudman & Dowd, a member of the national opioids leadership team and the city's outside counsel team, said in an email statement Breyer's opinion "recounts in meticulous detail the devastating story of the opioid crisis in San Francisco."

"We can only hope that the order is being distributed and read in big pharma boardrooms across the country," he said. "Every drug company is going to have to reckon with the striking, painstaking account about callous conduct and the harm it creates—and ensure this never happens again."

Lieff Cabraser partner and co-lead counsel in the case Richard Heimann called the decision "an important milestone" in the national opioids litigation. "We are pleased and proud that San Francisco has contributed so significantly to addressing the crisis that confronts cities and counties across the country," Heimann said.

Lieff Cabraser's Elizabeth Cabraser, who also served as co-lead counsel, said the city's bellwether effort to hold opioid manufacturers and distributors accountable for creating and prolonging the opioid epidemic is a testament to the power of the civil justice system to redress wrongs and create justice.

"Whether the outcome is a judgment, as here against Walgreens, or historic and meaningful settlements, as to the other defendants, the result is a win for everyone who has been touched by opioid addiction, a path and a means to move our communities forward and out of the shadow of this man-made plague," Cabraser said.

Editor's Note: While the majority of decisions regarding insurance coverage for opioid claims to date have been in the context of CGL coverage, directors and officers liability (D&O) as well as professional liability (E&O) policies are also potentially implicated by these lawsuits. D&O insurance is primarily intended to protect the personal assets of corporate directors and officers. E&O insurance generally covers claims arising out of an alleged failure to render professional services to a third party.

Read More: Starting to Answer Insurance Coverage Questions Two Decades Into Opioid Crisis