Rite Aid brought in $24 billion in 2021 from its 2600 or so locations, but the company is planning to declare bankruptcy. Why? To avoid opioid lawsuits seeking to hold it liable for selling addictive, lethal drugs to patients for years.
The chapter 11 filing would cover Rite Aid's more than $3.3 billion debt load and pending legal allegations that it oversupplied prescription painkillers, the people said. Philadelphia-based Rite Aid hasn't agreed on a settlement with federal, state government and private opioid plaintiffs to resolve those opioid liabilities in a potential chapter 11 and is currently planning to treat them as general unsecured claims, they said.
A representative for Rite Aid didn't respond to a request for comment. Its restructuring counsel at law firm Kirkland & Ellis also didn't respond.
You will get a penny, contrary to the old line, but that's all you'll get, and only as part of a structured settlement.
Johnson & Johnson did a similar trick to evade liability for selling asbestos-laced talc for decades, splitting off a worthless subsidiary to hold the bag while the real company marches on, legally free of its victims.