(Bloomberg) -- A judge in Tennessee found Endo International Plc liable in an opioid-marketing case by default and is stripping the company of its legal defenses in an upcoming trial.

In a rare move, the judge entered a so-called default judgment against Endo on Monday after finding the company intentionally concealed documents from Tennessee municipalities suing over its marketing of its opioid-based painkillers. The 13 counties want as much as $23 billion from Endo and other defendants in reimbursement of tax dollars spent fighting the public-health crisis. 

The move by the judge punishes the company for failing to hand over the files by effectively finding it liable for claims made by the counties. As a result, Endo faces a damages-only trial next year that will decide how much the company will have to pay for mishandling opioids.

“The court finds the withholding of documents by Endo was willful, not inadvertent, and part of a long-term pattern of behavior,” Young said in his 10-page order. 

Endo’s bonds were among the biggest decliners in the market for high-yield debt Tuesday, with notes due 2028 falling more than 3 cents on the dollar to 63.375 cents as of 11:10 a.m. in New York, according to TRACE data.

Default Judgments

While default judgments are relatively uncommon in U.S. litigation, Endo has faced several for failing to hand over files related to their opioid marketing strategies. In April, another Tennessee judge barred the Dublin, Ireland-based opioid maker from defending itself over the document snafu. Five months later, Endo paid $35 million to settle the case. 

Last year, Endo avoided a default judgment in a New York opioid case over the same information-sharing issue by agreeing to pay $50 million to settle that case and make the discovery issue moot.

Heather Zoumas-Lubeski, an Endo spokeswoman, didn’t return an email and a call Monday seeking comment on the latest default judgment against the company. In a statement earlier this month after a hearing before Young, Endo representatives said there was “no valid basis” for sanctioning the firm again over the missing files.

“Instead of applying the law to the facts before it, the court improperly adopted the findings of a different Tennessee court in a different case,” said Matthew Maletta, Endo’s chief legal officer.

The Tennessee counties allege Endo, along with opioid maker Teva Pharmaceutical Industries Ltd., and pharmacy chains such as CVS Health Corp. and Walgreens Boots Alliance Inc., mishandled opioid painkillers and created a so-called “public nuisance” with their lax oversight of highly addictive medicines.

More than 500,000 Americans have died from overdoses tied to opioid-based drugs over the last two decades. State and local governments are seeking to recover billions in tax dollars spent battling the fallout from opioid addictions. States and municipalities have racked up more than $26 billion in settlements so far in the litigation.

Young, elected to his post in 2014, explained the basis for his ruling against Endo in an interview with Law360.com this month. “It’s the worst case of document hiding that I’ve ever seen,” the judge told the news service. “It was like a plot out of a John Grisham movie, except it was even worse than what he could dream up.”

The case is Clay County v. AmerisourceBergen Drug Corp., CCl-2018-cv-6347, Circuit Court for the State of Tennessee, County of Cumberland (Cookeville).

(Updates with bond prices. An earlier version corrected description of New York case.)

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