While state and local governments have begun receiving their share of opioid settlement funds from a variety of parties held responsible for harm, the maker of the drug that is at the center of the opioid crisis, Purdue Pharma, has been trying to shield its wealthy Sackler family owners from further lawsuits over their role in the country’s opioid epidemic.
Purdue filed for Chapter 11 bankruptcy in 2019 to address its debts, which mostly stemmed from thousands of lawsuits alleging that OxyContin helped to kickstart the opioid epidemic that has taken more than 500,000 lives across the country over two decades.
On August 10th of this year, the US Supreme Court agreed to hear a challenge by President Joe Biden’s administration to the legality of the bankruptcy settlement. Filing for bankruptcy protections is meant for debtors in “financial distress,” not people like the Sacklers who are said to be worth over $11 billion.
The issue in question is whether or not the U.S bankruptcy law allows Purdue’s restructuring to include legal protections for the members of the Sackler family, even though they did not file for bankruptcy individually.
Under the bankruptcy settlement, Purdue’s owners would receive immunity in exchange for paying up to $6 billion to settle thousands of lawsuits over its misleading marketing of the powerful pain medication OxyContin. Before the Sacklers agreed to pay the $6 billion, the family withdrew $11 billion from Purdue.
The justices have paused the bankruptcy proceedings relating to Purdue and its affiliates and said they would hold oral arguments in December.