The US Supreme Court rejected the bankruptcy deal that had been negotiated by the Sackler family, the people behind Purdue Pharmaceuticals that was responsible for aggressively and falsely marketing opioids to large numbers of doctors and their patients, resulting in the massive opioid epidemic that we currently have in the US that has devastated families and communities. The drug was heavily marketed to doctors as having low risk of addiction, which was not true.
The Sacklers had brought the settlement in front of a friendly bankruptcy judge that effectively shielded much of the vast personal fortunes they had accumulated and instead passed the cost on to the company, which has filed for bankruptcy, on friendly terms, while not having to admit guilt and getting total immunity from future lawsuits that will leave their personal fortunes intact. For more details on why the bankruptcy deal was so bad, see here.
Some states and individuals that. had originally sued the Sacklers agreed to the deal because it would end the long-drawn out sage and they would finally get some money to try and deal with the consequences. Other. states and individuals were outraged that the deal was so favorable to the Sacklers and would prevent them from getting their own day in court by barring them from filing lawsuits against the Sacklers.
The 5-4 ruling had an unusual combination of alliances, with four conservatives (Samuel Alito, Clarence Thomas, Neil Gorsuch and Amy Coney Barrett) being joined by Ketanji Brown Jackson in the majority.
“The Sacklers seek greater relief than a bankruptcy discharge normally affords, for they hope to extinguish even claims for wrongful death and fraud, and they seek to do so without putting anything close to all their assets on the table,” Gorsuch wrote in the opinion. “Describe the relief the Sacklers seek how you will, nothing in the bankruptcy code contemplates (much less authorizes) it.”
…The ruling in the case of Harrington v Purdue Pharma blocks a controversial deal approved by a federal bankruptcy court in New York that was first knocked down by a district court, then upheld on appeal before being put on hold while the US Department of Justice challenged it at the supreme court. Oral arguments were heard last December.
The deal was constructed to allow Purdue, the Connecticut company behind the prescription opioid OxyContin, to restructure and also shield the relevant Sackler billionaires without them having to declare personal bankruptcy. The family agreed to contribute $6bn to the settlement from the vast fortune they made from OxyContin and give up ownership.
The company wanted to use the bankruptcy agreement to resolve thousands of lawsuits, many filed by state and local governments across the US, alleging that Purdue Pharma fueled a crisis that ultimately killed half a million Americans by claiming its flagship drug was non-addictive while incentivizing massive over-prescribing.
US solicitor general Elizabeth Prelogar had argued that the release of the Sacklers from future liability is not authorized by the bankruptcy code and constitutes an “abuse of the bankruptcy system.”
…The US government argued that a settlement could be forged without resorting to the protections of chapter 11 bankruptcy law or releasing the billionaire Sacklers behind the company from liability.
The supreme court ruling now leaves matters between the company and plaintiffs unresolved. The case is seen as having consequences for other corporate bankruptcies where company owners or officials want immunity from liability.
The court also held that since the Sacklers did not seek bankruptcy protection for themselves, the deal could not grant them that.
I have mixed feelings about this. While I absolutely detest the Sacklers for their greed and reckless disregard for others in their pursuit of money and would like them to be pursued for the rest of their lives and thus am glad that the deal granting them lifelong immunity was rejected, I can also sympathize with those families and communities who are exhausted by the legal process and just wanted some immediate relief from their pain.
You can read the opinions here.
[The main meanings of the Old Norse word saga (plural sǫgur) are ‘what is said, utterance, oral account, notification’ and the sense used in this article: ‘(structured) narrative, story (about somebody)’.[1] It is cognate with the English words say and saw (in the sense ‘a saying’, as in old saw), and the German Sage; but the modern English term saga was borrowed directly into English from Old Norse by scholars in the eighteenth century to refer to Old Norse prose narratives.[2][3] — Wikipedia
n. Epic: An extended narrative poem in elevated or dignified language, celebrating the feats of a deity, demigod (heroic epic), other legend or traditional hero. — Wiktionary]
I wouldn’t shed any tears if the Sacklers fell down a large hole and then spontaneously combusted. But I find the dissent (pages 25 to 78, quite a read but worth it imo) more convincing than the ruling. I think the court got it wrong. The quote referenced on page 78 is well worth remembering: “Nothing is more antithetical to the purpose of bankruptcy than destroying estate value to punish someone.”
From Merriam-Webster: saga (noun):
. . .
3: a long detailed account
also : a dramatic and often complicated story or series of events
—Nora Caplan-Bricker
—Jordan S. Rubin
gedjcj, I know all that.
I was alluding to a typo: “long-drawn out sage”.
Bankruptcy should be orderly and straightforward. What the Sacklers did was not merely being sorry and pleading mercy before the court. It was a sick and twisted abomination of the founders’ intents. The dissent is wrong.
#2 f13
But this is not about plain bankruptcy, this is about using a bankruptcy agreement to safeguard one’s assets from legal action. That too is “antithetical to the purpose of bankruptcy”.
I remember with some fondness that a French court put people in jail for the tainted blood/HIV débâcle, something my government did not do.
One of my favourite first cousins got Aids from tainted blood. I’d toss the Sackers into prison for 50 years along with those CDN Red Cross Bastards.