Supreme Court halts settlement protecting Sacklers from opioid lawsuits

The U.S. Supreme Court today halted a Purdue Pharma settlement that would have protected the billionaire Sackler family from civil lawsuits related to the opioid crisis.

The Sacklers, who amassed their wealth through the promotion of an addictive and deadly drug, must be perplexed at this turn of events. They might be thinking, "Isn't the system supposed to let wealthy people like us get away with everything? What went wrong?"

From CNN:

Until recently, Purdue was controlled by the Sackler family, who withdrew billions of dollars from the company before it filed for bankruptcy. The family has now agreed to contribute up to $6 billion to Purdue's reorganization fund on the condition that the Sacklers receive a release from civil liability.

Purdue expressed disappointment in a statement, implying that they're concerned about the victims, not their personal wealth: "We are disappointed that the U.S. Trustee, despite having no tangible interest in the outcome of this process, has been able to single-handedly delay billions of dollars in value that should be put to use for victim compensation, opioid crisis abatement for communities across the country, and overdose rescue medicines." T

From The New York Times:

Although it is routine for companies who seek bankruptcy protection to be shielded from legal claims, the unusual part of this agreement was that it extended that liability protection to the company's owners. Sackler family members have said they would not sign onto a settlement without an agreement protecting them from lawsuits.

From CNN:

The government, representing the US Trustee, has called the plan "exceptional and unprecedented" in court papers, noting that lower courts have divided on when parties can be released from liability for actions that caused societal harm.

"The plan's release 'absolutely, unconditionally, irrevocably, fully, finally, forever and permanently releases' the Sacklers from every conceivable type of opioid-related civil claim – even claims based on fraud and other forms of willful misconduct that could not be discharged if the Sacklers filed for bankruptcy in their individual capacities," Solicitor General Elizabeth Prelogar argued in court papers.

Prelogar said that the release of the Sacklers is not authorized by the bankruptcy code and constitutes an "abuse of the bankruptcy system."