U.S. Seeks to Block Bankruptcy Plan That Would Free Sacklers From Opioid Claims

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Politics|U.S. Seeks to Block Bankruptcy Plan That Would Free Sacklers From Opioid Claims


The Justice Department has been appealing the deal, approved earlier this month.

An representation  of the bankruptcy justice  Robert Drain successful  beforehand   of Purdue Pharma’s office  successful  Stamford, Conn., this month. The justice  approved a colony  that grants wide  ineligible  immunity to the company.
Credit...Mark Lennihan/Associated Press

Katie Benner

Sept. 16, 2021, 6:46 p.m. ET

WASHINGTON — The Justice Department moved connected Thursday to artifact a bankruptcy program that grants wide ineligible immunity to the pharmaceutical institution Purdue Pharma, whose cause OxyContin has been astatine the bosom of the nation’s opioid epidemic.

William K. Harrington, the U.S. trustee for the Justice Department, filed a question successful national tribunal to halt confirmation of the colony portion the section appeals the judge’s determination to o.k. the deal.

Mr. Harrington said that the tribunal should assistance his petition for a enactment due to the fact that the national authorities “has a important anticipation of occurrence connected entreaty and due to the fact that the harm that would effect from denying a enactment outweighs immoderate imaginable harm from granting one.”

The contentious woody was approved this month by Judge Robert Drain, a national justice successful White Plains, N.Y. Among different things, it could merchandise the Sackler family, which owns Purdue Pharma, from aboriginal ineligible liability successful speech for a $4.3 cardinal fiscal publication from the family’s ain fortune.

Mr. Harrington argued successful his filing that the appellate tribunal decided that the woody takes distant the rights of those with a valid ineligible assertion against the Sacklers “without their knowing and informed consent, capable announcement oregon an accidental to beryllium heard.”

He besides said that the national government’s lawsuit was supported by erstwhile Supreme Court rulings.

The Justice Department filing is the latest successful the yearslong conflict to clasp the Sackler household to relationship for creating, selling and selling OxyContin, a highly addictive painkiller.

Some experts person argued that OxyContin helped substance an opioid addiction epidemic that has killed much than 500,000 radical nationwide and inactive grips the United States 15 years aft the cause was introduced to the market.

But OxyContin made the Sackler household incredibly wealthy. From 2008 to 2017, the household withdrew $10.4 cardinal from Purdue Pharma.

As much radical died from opioid use, plaintiffs began to writer Purdue. By the clip the institution filed for bankruptcy successful September 2019, it faced 2,900 lawsuits, much than 600 of which named the Sacklers. The bankruptcy proceedings enactment a intermission connected those ineligible claims.

Judge Drain approved the colony program aft painstaking negotiations among the family, section governments, infirmary systems and others who had sued the institution and were apt to beryllium progressive successful costly litigation for years to come.

Those who supported the deal, including a bulk of states and immoderate of the plaintiffs, argued that it would supply much-needed backing for cause attraction programs.

Steve Miller, the president of Purdue’s board, said that the colony “ensures that billions of dollars volition beryllium devoted to helping radical and communities who person been wounded by the opioid crisis.” And immoderate members of the Sackler household called the solution an important measurement successful addressing the nationalist wellness crisis.

But critics said that the presumption unfairly shielded the Sacklers. It gave the household protections typically afforded to companies that person filed bankruptcy, but not to the institution owners if they themselves person not declared bankruptcy.

The Justice Department and immoderate states appealed Judge Drain’s ruling.

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