Purdue's Bankruptcy Plan Wins Court Approval

On September 1, 2021, Purdue’s $4.5 billion bankruptcy reorganization plan won court approval. Among other things, the deal grants members of the Sackler family “sweeping legal immunity” and shields them from future opioid crisis-related suits. The list of objectors includes nine states and even a branch of the DOJ.

Though settlement puts an end to the “years or decades of Hobbesian hell” parties would’ve experienced in litigation without it, folks are dissatisfied. The Attorneys General for Washington and Connecticut intend to challenge the decision on appeal, and even the federal judge overseeing the proceedings — often criticized for his alleged pro-Sackler vibes — calls the deal a "bitter result" and states that he “would have expected a higher settlement.” There is likely to be some federal legislation passed; members of Congress are already “pushing for an overhaul of the bankruptcy code” in response to what they describe as a truly “dark day for justice in America.”

Reorganization documents may be found here: https://restructuring.primeclerk.com/purduepharma/

A note for my readers: Purdue’s bankruptcy settlement is separate and apart from that other, $26 billion “global” settlement with opioid defendants McKesson, AmerisourceBergen, Cardinal Health, and Johnson & Johnson. Importantly, “Most of the funds sent to government entities [pursuant to Purdue’s bankruptcy deal]” are largely predetermined, so whenever you hear about state-subdivision allocation plans, memoranda of agreement, or opioid settlement fund statutes, know that those measures relate to government plaintiffs’ obligations under the terms proffered by McKesson, AmerisourceBergen, Cardinal Health, and Johnson & Johnson.