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State attorneys general would very much like to keep slinging lawsuits at the Sackler family, the billionaire clan that built Purdue Pharma and its OxyContin empire.
The problem is that Purdue Pharma filed for Chapter 11 bankruptcy in New York State last month, effectively shielding the company from the 2,500-plus lawsuits accusing it of exacerbating the opioid crisis with the blockbuster painkiller it introduced in 1996.
The Sackler family also requested the judge in that bankruptcy case protect them from litigation, too, at least temporarily. Their attorneys argued that the thousands of lawsuits against them and the company might draw resources away from the $10 billion settlement deal they’ve proposed to end the whole ordeal.
Attorneys general from 24 states and the District of Columbia are desperately trying to pierce that bankruptcy shield so their lawsuits can survive.
The states, which include California, Massachusetts, New York, New Jersey, and others, collectively filed motions in United States Bankruptcy Court for the Southern District of New York on Friday to object to Purdue’s requests to stop the onslaught of litigation. Many of those states objected to the settlement agreement to begin with, have vowed to sue the Sacklers independently, or both.
Notably, Purdue’s settlement agreement — which included the bankruptcy filing — also absolves the company of having to admit wrongdoing. Purdue has long been accused of deceptive and aggressive marketing tactics that hooked people on prescription pills — an accusation the company has repeatedly denied.
Twenty-four states currently disagree with the proposed settlement deal, while 24 states say they’re willing to take it. While it’s standard for active lawsuits to be put on hold during bankruptcy proceedings, state attorneys general have accused the company of trying to escape accountability. And, state attorneys think the family can shoulder the financial load of the lawsuits. Purdue sent as much as $13 billion in profits back to the Sackler family, according to the Wall Street Journal.
“The Sacklers want the bankruptcy court to stop our lawsuits so they can keep the billions of dollars they pocketed from OxyContin and walk away without ever being held accountable – that’s unacceptable,” Massachusetts Attorney General Maura Healey said in a statement Friday. Her state was the first to sue the billionaire clan, and rejected the settlement proposal.
“We filed our lawsuit to get answers for families in Massachusetts who have been devastated by this epidemic, and we will keep fighting for the justice they deserve,” she said.
Additionally, 16 counties and cities in Nevada asked the bankruptcy judge Thursday to reject Purdue Pharma’s request to halt the litigation, according to Reuters.
“Without a stay of the litigation, only lawyers will win,” a spokesperson for Purdue Pharma said in a statement. “The costs of the ongoing litigation are staggering. Purdue will spend nearly a quarter of a billion dollars on legal expenses in 2019. This is money that should be made available to the American people to address the opioid crisis, and not wasted on lawyers.”
This is hardly the first time the company has pissed off high-ranking attorneys in court, either, For one, the drugmaker asked last month to shell out $34 million in bonuses to high-performing employees, which the bankruptcy judge would have to authorize. State attorneys general have balked at that number and have said Purdue should be trying to save its cash for victims.
Before the settlement, Purdue Pharma was facing a blockbuster bellwether trial in Ohio this month against dozens of opioid manufacturers, distributors, and retailers. Other drugmakers are now reportedly looking to join in Purdue’s bankruptcy to avoid admissions of liability, according to the Wall Street Journal.
Cover: Members of P.A.I.N. (Prescription Addiction Intervention Now) and Truth Pharm staged a protest on September 12, 2019 outside Purdue Pharma headquarters in Stamford, over their recent controversial opioid settlement. Participants dropped hundreds prescription bottles of OxyContin while holding tombstones with the names of opioids casualties. (Photo by Erik McGregor/LightRocket via Getty Images)