Why US supreme court halted Purdue Pharma bankruptcy plan
The US Supreme Court blocked bankruptcy plan of Purdue Pharma on 10 August 2023, pending review of the legality of the plan. The plan would have shielded the Sackler family, the owners of Purdue Pharma, from future lawsuits over their role in the opioid crisis.
The Biden administration and eight states challenged the settlement, arguing that it was an abuse of the bankruptcy system and that it did not provide enough compensation to victims of the opioid crisis. The Supreme Court agreed to hear the case and will hold oral arguments in December 2023.
The Supreme Court’s decision to block the settlement is a significant setback for Purdue Pharma and the Sackler family. The settlement was seen as a way to finally bring closure to the opioid crisis, but the Supreme Court’s decision has cast doubt on its future.
The Supreme Court’s decision is also a victory for the Biden administration, which has made fighting the opioid crisis a top priority. The administration argued that the settlement was unfair to victims of the crisis and that it would set a dangerous precedent for other companies that have engaged in harmful practices.
The Supreme Court’s decision is likely to have a significant impact on the opioid crisis. The settlement would have provided billions of dollars to address the crisis, but with the settlement blocked, it is unclear how the crisis will be funded. The Supreme Court’s decision will also be closely watched by other companies that are facing lawsuits over their role in the opioid crisis. The decision could have implications for how these companies resolve their legal disputes.
Purdue Pharma is a pharmaceutical company that developed and marketed OxyContin, a powerful pain medication that has been linked to the opioid crisis. The company filed for Chapter 11 bankruptcy in 2019 in an effort to avoid bankruptcy and resolve thousands of lawsuits filed against it.
The bankruptcy plan, which was approved by a bankruptcy judge in 2021, would have shielded the Sackler family from future lawsuits over their role in the opioid crisis. The plan would have also required the Sacklers to pay $6 billion to settle the lawsuits and to create a foundation to combat the opioid crisis.
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