Federal judge overturns Purdue Pharma rule that left Sacklers immune from prosecution
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A federal judge on Thursday overturned the bankruptcy plan brokered by Purdue Pharma, saying a deal that freed the billionaire Sackler family from opioid-related lawsuits was “inconsistent” with the law.
District Judge Colleen McMahon said in her ruling Thursday that the $ 4.5 billion settlement announced earlier this year should not go ahead because it protects the Sacklers – one of the wealthiest families in America – from all liability in future cases relating to Purdue’s primary opioid, OxyContin.
Purdue Pharma said Thursday evening it would appeal the ruling, criticizing the ruling and saying it would limit the amount of money available to jurisdictions that have sued the company over its role in the opioid epidemic.
“It will delay, and possibly end, the ability of creditors, communities and individuals to receive billions of dollars to alleviate the opioid crisis,” said Steve Miller, chairman of the board of directors of the company, in a press release. “These funds are needed more than ever as overdose rates hit record highs, and we are confident that we can successfully appeal this decision and provide desperately needed funds to communities and those suffering in the midst of this crisis. “
Purdue first filed for bankruptcy protection in 2019 amid a tidal wave of lawsuits over his aggressive tactics of marketing OxyContin to Americans. The landmark settlement approved earlier this year by a New York bankruptcy court judge has been hailed by thousands of state, local and tribal governments who have said they will immediately use the money to help treat opioid addiction .
The deal would see Purdue formally disband and a new company formed to produce OxyContin, but the proceeds would go to states and fund opioid treatment. The Sacklers said they would relinquish ownership of the company and personally contribute $ 4.5 billion of their own money to the settlement, and all lawsuits against Purdue would be dissolved.
However, the Sacklers also insisted that the deal include immunity from any case related to its opioids in civil court in order to contribute a chunk of their billions to the deal.
Several states have filed an appeal, saying they were not happy with the terms of the settlement, adding that the Sacklers should be held responsible for their products. Lawyers representing those states said the judge’s ruling on Thursday will help hold the family accountable for their role in the outbreak.
“It’s a seismic victory for justice and accountability that will reopen Purdue’s deeply tainted bankruptcy and force the Sackler family to face the pain and devastation it has caused,” said William Tong, Attorney General of Connecticut, in a press release.
In her ruling on Thursday, McMahon said she was troubled that the Sacklers withdrew more than $ 10 billion from Purdue between 2008 and 2018, funds that were mostly deposited into accounts beyond the reach of U.S. authorities at the height of time. of the opioid crisis.
The Sacklers have denied any transfer irregularities.
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