A federal bankruptcy judge has approved the settlement deal that dissolves Stamford’s Purdue Pharma, the maker of the addictive painkiller OxyContin, while providing immunity to members of the Sackler family, the company”™s owners, from future lawsuits.
Under the terms of the settlement, Purdue Pharma will pay $4.5 billion to settle the multitude of lawsuits brought against the company related to its role in fueling the opioid crisis. Purdue Pharma’s operating assets will be transferred to a newly-formed public benefit company and a compensation fund will be established to pay some victims of opioid addiction between $3,500 to $48,000 per person.
The Sacklers will not be stakeholders in the new public benefit company and they will be required to relinquish control of family foundations with more than $175 million in assets to the trustees of a National Opioid Abatement Trust.
The settlement also includes legal releases to shield the Sacklers from future lawsuits related to their involvement in the opioid crisis. Bankruptcy Judge Robert Drain opined that this aspect of the settlement was “a bitter result,” noting Purdue Pharma”™s marketing of OxyContin played a key role in the crisis despite the Sackler family”™s insistence that they were not responsible for what transpired.
“A forced apology is not really an apology,” said Drain about the absence of remorse from the Sacklers. “And so, we will live without one.”
Connecticut Attorney General William Tong issued a statement announcing his office planned to appeal the settlement.
“The Sacklers are not bankrupt, and they should not be allowed to manipulate bankruptcy laws to evade justice and protect their blood money,” Tong said. “This decision is a slap in the face to the millions of suffering and grieving Americans who have lost their lives and loved ones due to the Sacklers calculated and craven pursuit of opioid profits. We need bankruptcy reform now to close the non-debtor release loophole to ensure wealthy bad actors cannot misuse our bankruptcy courts to escape justice.”
Washington Attorney General Bob Ferguson also announced he would appeal the settlement.
“This order is insulting to victims of the opioid epidemic who had no voice in these proceedings,” said Ferguson.
