**Supreme Court Denies Nationwide Opioid Settlement with OxyContin Maker Purdue Pharma**
In a significant ruling, the Supreme Court on Thursday rejected a nationwide settlement with Purdue Pharma, the maker of OxyContin, that would have shielded members of the Sackler family from civil lawsuits related to the opioid crisis. The decision, which came after more than six months of deliberation, was reached by a narrow 5-4 vote.
The proposed settlement, which had been negotiated with state and local governments as well as victims, would have seen the Sacklers contribute up to $6 billion and relinquish ownership of Purdue Pharma. In return, they would have retained billions more and been protected from future civil litigation. The plan also stipulated that Purdue Pharma would emerge from bankruptcy as a new entity, with its profits directed towards opioid treatment and prevention efforts.
Justice Neil Gorsuch, writing for the majority, stated that “nothing in present law authorizes the Sackler discharge.” The dissenting justices, Brett Kavanaugh, Ketanji Brown Jackson, Elena Kagan, and Sonia Sotomayor, expressed concern over the impact of the decision on opioid victims and future mass tort victims. Kavanaugh noted, “Opioid victims and other future victims of mass torts will suffer greatly in the wake of today’s unfortunate and destabilizing decision.”
The Supreme Court had previously put the settlement on hold last summer following objections from the Biden administration. The future of the settlement remains uncertain, leaving many stakeholders in limbo.
Edward Neiger, a lawyer representing over 60,000 overdose victims, described the ruling as a major setback for families affected by the opioid crisis. “The Purdue plan was a victim-centered plan that would provide billions of dollars to the states to be used exclusively to abate the opioid crisis and $750 million for victims of the crisis, so that they could begin to rebuild their lives,” Neiger said. He criticized the government’s opposition to the plan, arguing that it has led to more overdose deaths.
On the other hand, some opponents of the settlement welcomed the Supreme Court’s decision. Ed Bisch, whose 18-year-old son Eddie died from an OxyContin overdose in 2001, has been a vocal critic of Purdue Pharma and the Sackler family. “This is a step toward justice. It was outrageous what they were trying to get away with,” Bisch said. He called for the Department of Justice to pursue criminal charges against Sackler family members.
The legal debate centered on whether the protections afforded by bankruptcy law could be extended to individuals like the Sacklers, who have not declared bankruptcy themselves. Lower courts had issued conflicting rulings on this issue, which has broader implications for other major product liability lawsuits settled through the bankruptcy system.
The U.S. Bankruptcy Trustee, an arm of the Justice Department, argued that bankruptcy law does not permit shielding the Sackler family from lawsuits. During the Trump administration, the government had supported the settlement, but the Biden administration argued that negotiations could resume and potentially lead to a better deal if the current agreement was halted.
Proponents of the settlement argued that third-party releases are sometimes necessary to reach an agreement and that federal law does not prohibit them. They emphasized that the settlement would have provided substantial funds for combating the opioid crisis.
OxyContin, which first hit the market in 1996, is often cited as a catalyst for the nationwide opioid epidemic. Purdue Pharma’s aggressive marketing of the drug led doctors to prescribe it with less regard for its addictive potential. The company and the drug became synonymous with the crisis, even though most of the pills being prescribed and used were generic drugs. Opioid-related overdose deaths have continued to rise, reaching 80,000 in recent years, with most of those deaths attributed to fentanyl and other synthetic opioids.
The Purdue Pharma settlement would have been one of the largest reached by drug companies, wholesalers, and pharmacies to resolve lawsuits related to the opioid epidemic. These settlements have totaled more than $50 billion. However, the Purdue settlement would have been only the second to include direct payments to victims, with a $750 million pool set aside for this purpose. Payouts to victims would have ranged from approximately $3,500 to $48,000.
Sackler family members are no longer on Purdue Pharma’s board and have not received payouts from the company since it entered bankruptcy. However, in the decade before the bankruptcy, they were paid more than $10 billion, with about half of that amount reportedly going towards taxes.
The case, Harrington v. Purdue Pharma, 22-859, remains a pivotal moment in the ongoing legal battles surrounding the opioid crisis. The Supreme Court’s decision underscores the complexities and challenges of addressing the epidemic through the legal system.
Source: Associated Press, Reuters
