NEW YORK – A US judge on Thursday dismissed a Purdue Pharma bankruptcy plan because it granted the company’s owners some immunity in exchange for paying $4.5 billion to victims of the opioid crisis.
In her decision seen by AFP, Judge Colleen McMahon said the federal judge who approved the drug company’s bankruptcy plan in September had the power to prevent future lawsuits against members of the Sackler family, except in cases of willful misconduct. did not have the right.
The plan was approved by 43 US states but challenged by the Justice Department and some other states. He argued that it denied the victims the right to sue the company.
US Attorney General Merrick Garland welcomed the decision. “The bankruptcy court did not have the authority to deny victims of the opioid crisis their right to sue the Sackler family,” he said.
Connecticut Attorney General William Tong said, “This is a seismic victory for justice and accountability that will reopen the deeply flawed Purdue bankruptcy and force the Sackler family to face the pain and devastation they have caused.” ” First decision.
Under the agreement, OxyContin’s maker, Purdue Pharma, would be dissolved and paid $4.5 billion to the Sackler families that established and profited from the company. But he could not be taken to court again for the drug.
Fake pill bottles with messages about Purdue Pharma are displayed during a protest outside the courthouse where the company is going bankrupt, in White Plains, NY, Monday, Aug. 9, 2021. (AP Photo/Seth Wenig)
The opioid addiction crisis in the United States caused more than 500,000 overdose deaths over the past 20 years.
Facing an avalanche of litigation, Purdue last year pleaded guilty to three criminal charges over its aggressive campaign to promote sales of the highly addictive painkiller OxyContin.
Under the terms of the deal, the company will be sold by 2024 to be replaced by a new entity managed by a trust, and its participation in selling opioid products will be restricted.
Purdue will also need to create a repository for the millions of documents detailing its sales and marketing practices.
In his decision, Judge McMahon acknowledged that reducing the immunity granted to the Sacklers would “almost certainly undo a carefully crafted plan that would bring about many wonderful things, including the treatment of opioid addiction in particular.” Including the funding of programs desperately needed to combat that.”
In this December 17, 2020 image from House television, David Sackler, a member of the family who owns Purdue Pharma, testifies via video for a House Oversight Committee hearing. (House Television via AP)
But since the Bankruptcy Code “provides no such right, the order confirming the plan must be vacated,” she said in a ruling, which itself can be appealed.
The judge acknowledged that his opinion on the ability of bankruptcy judges to grant immunity would not be the final word on the subject.
Purdue Pharma said it would appeal.