- author, Natalie Sherman
- role, BBC News
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The U.S. Supreme Court Part of the bankruptcy agreement was revoked. The bill would protect members of the Sackler family from future lawsuits over their role in fueling the opioid crisis.
The Sackler family, who owned and ran the OxyContin maker for decades, had agreed to pay $6 billion (£4.7 billion) towards a wider settlement in exchange for comprehensive protection against civil lawsuits relating to the addictive opioid.
But the nation’s highest court ruled that such protections should not be given to the Sacklers. Those who did not declare bankruptcy themselves were not recognized by law.
The Sackler family said they would continue to seek a settlement, warning that the alternative would result in “a costly and messy legal process in courts across the country.”
This ruling is a victory for the U.S. government. others They had challenged the deal, arguing that releasing the Sackler brothers was an abuse of the system.
But the agreement has received significant, albeit mixed, support from many of the people who sued the company, who saw it as the only practical way to raise billions of dollars for their families for drug treatment and other uses, raising big questions about its future.
Ellen Isaacs, whose son Patrick Ryan Wroblewski died of a drug overdose at age 33 in 2018, was among the family members who opposed the Sackler plaque.
She said she doesn’t know what happens next, but is hopeful justice will be served.
“I want to see them fully held accountable,” she said. “I’m very grateful to the Supreme Court and I have nothing more to say.”
Purdue became well known in the United States as the manufacturer and distributor of OxyContin, a prescription painkiller that it promoted as safe, despite knowing it was highly addictive and widely abused.
The company, facing thousands of lawsuits from states, cities and families, declared bankruptcy in 2019 and later pleaded guilty to criminal charges including defrauding health agencies and making illegal payments to doctors.
The protections given to the Sacklers in the deal were also key features of other high-profile settlements, including one involving the Boy Scouts of America and the Catholic Church.
However, courts are divided on whether such “immunity” can actually be granted to third parties like the Sacklers.
U.S. government lawyers urged the Supreme Court to consider the issue, saying leaving it alone would leave an avenue for “wealthy corporations and individuals to abuse the bankruptcy system” and avoid responsibility.
Writing for a 5-4 majority, Justice Neil Gorsuch expressed similar concerns.
“The Sacklers have not agreed to release anywhere near their entire fortune for opioid victims,” he wrote, “but they are seeking a judicial order that would extinguish nearly all claims against them for fraud, intentional injury and even wrongful death, without the consent of those who have brought or are seeking to bring such claims.”
The court noted that the Sacklers, who have long denied any wrongdoing, were “seeking to pay less than the statute would normally require and receive more than the statute would normally allow.”
OxyContin is often a gateway to harder drugs such as heroin and has been blamed for sparking the opioid crisis.
Since 1999, just a few years after the drugs became available, opioid overdose deaths have increased eightfold to more than 80,000 per year.
The Sacklers were aware of the legal risks long ago and withdrew about $11 billion from the company in the decade before its bankruptcy, according to court documents, stashing much of the money overseas. Part of it goes towards paying corporate taxes, This makes recovery more difficult.
As the Supreme Court heard the case last year, dozens of protesters opposed to the deal showed up, holding signs including “My dead son will not release the Sacklers.”
But many others supported the deal and said they would be willing to accept the terms if it resulted in billions of dollars in treatment costs, plus an estimated $750 million in direct payments — between $3,500 and $48,000 for each person with opioid addiction.
Image source, Getty Images
In his dissent, Justice Brett Kavanaugh called the settlement a “shining example” that the bankruptcy system works.
“Today’s ruling is legally incorrect and devastating for the more than 100,000 opioid victims and their families,” he wrote, warning that it will limit the bankruptcy court’s ability to “grant just and equitable relief.”
Purdue called Thursday’s decision “heartbreaking” and said it would immediately re-enter contact and resume negotiations.
Yale Law School professor Abe Gluck said the judges were under “intense pressure not to stop this money flowing to victims.”
But she said the dispute has become a “test case” for broader legal issues as many companies seek to resolve large numbers of unjustified claims in bankruptcy courts that have extraordinary powers to centralize litigation and force settlements.
She said the decision was a warning against such trends.
“The court has sent a warning signal that should have an impact on other pending litigation,” she said, adding that the ruling leaves open the possibility that the bankruptcy court could grant legal protections to third parties such as the Sacklers if an agreement is reached.
Cheryl Juair, who served on the creditors’ committee and helped negotiate the agreement and is the mother of two boys who died of opioid overdoses, said the prospect of further negotiations was “a total nightmare.”
“There is no win-win here. Putting the Sacklers in prison would be justice for a lot of people, but it won’t save lives,” Juair said.
But Indiana Judge William Nelson, whose son died of a drug overdose in 2009 and who opposed the deal, said the fight for him isn’t about money.
“It doesn’t matter if I don’t get a dime,” he said.
He said he expects criminal charges will one day be brought against the Sacklers.
“While we sympathize with those who had hoped for a settlement, we remain adamant that we believe this is the right decision,” he said. “This sends, or should send, a message to the Sackler family that they are not above the law.”
