Purdue decision throws bankruptcy deal into questionpublished at 15:33 27 June
Natalie Sherman
New York business reporter
![Composite of Purdue logos](https://i0.wp.com/ichef.bbci.co.uk/news/640/cpsprodpb/vivo/live/images/2024/6/27/4bb94787-8d8c-453b-b7b3-fe45b64ba13a.jpg?resize=696%2C473&ssl=1)
One of the main rulings released today is the Purdue decision, which has thrown into question a bankruptcy deal for Purdue Pharma.
That deal would have shielded members of the Sackler family from future lawsuits over their role in fuelling the opioid crisis.
It is a victory for the US government, which had challenged the deal, arguing that releasing the Sacklers was a misuse of the system.
But it raises significant questions about the future of the settlement deal, which had won significant, if mixed, support from many who sued the company and saw it as the only practical way to reach the family’s billions for drug treatment and other uses.
In the 5-4 opinion, Justice Neil Gorsuch said the ruling was a narrow one and referred the case back to lower courts.
The kind of shield granted to the Sacklers has been a critical feature of other high-profile settlements, including those involving Boy Scouts of America and the Catholic Church.
But courts have been divided as to whether such “releases” from liability for third parties like the Sacklers, who did not themselves declare bankruptcy, are actually permitted.
In asking the Supreme Court to take up the issue, lawyers for the US government said letting it stand “would leave in place a roadmap for wealthy corporations and individuals to misuse the bankruptcy system” and escape accountability.
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