Last week, by a 5-4 vote, the U.S. Supreme Court threw out the bankruptcy settlement involving Purdue Pharma, maker of the addictive opioid Oxycontin, and its owners, the Sackler family. The settlement has been valued at between $6 billion and $10 billion.
According to the settlement, Sackler family members agreed to pay $6 billion into the compensation pot. In exchange, the family would have been shielded from personal liability.
The U.S. Justice Department argued the deal would have violated victims’ constitutional rights to due process because it prevented them from filing lawsuits. Writing for the dissenters, Justice Brett Kavanaugh said, “Today’s decision is wrong on the law and devastating for more than 100,000 opioid victims and their families.”
Levin Papantonio partner Peter Mougey has been involved in some of the nation’s most significant mass tort cases concerning opioids. He served as one of the key negotiators in the nearly $60 billion settlements with opioid manufacturer Johnson & Johnson (J&J) and the “Big Three” drug distributors AmerisourceBergen, Cardinal Health, McKesson, and national pharmacy claims. He believes the Supreme Court decision may turn out to be a good one.
“The Sackler family would walk away with billions of dollars, which is sad,” he said. “It is the epitome of trading corporate profit for human lives. And you don’t have to look far in any community to see the destruction the Sacklers are causing—150 deaths a day. Should the Sacklers get a pass and walk away with billions of dollars? Of course not.”
Mougey explained that many cities, counties, and states have favored the bankruptcy deal. “The difficulty is going to be that the Sacklers have been taking money out of Purdue just like you would any corporation for decades. And the money’s all over the world, and trying to get to the money is going to be difficult.”
Because of the ruling, Purdue Pharma owners could face a “gazillion lawsuits” unless they find a remedy. Mougey said, “They shouldn’t be able to walk away scot-free after paying out a small portion of their global net worth, enjoy their billions of dollars, and ride off into the sunset.”
