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June 16, 2023

Sackler Bankruptcy Article Clarification

Our June 2 publication included an article about a Second Circuit opinion in the Purdue Pharma bankruptcy.  The article, however, failed to identify the lower court. We wish to clarify that article here. 

In this case, the federal bankruptcy court had approved a settlement under which the Sackler family contributed a multi-billion dollar sum to resolve opioid-related claims against its bankrupt company Purdue Pharma in return for protection against related civil litigation.  The U.S. Trustee in bankruptcy appealed the civil litigation liability protection to the U.S. District Court for the Southern District of New York. The district court ruled in favor of the U.S. Trustee.  

Purdue Pharma and the Sackler family appealed to the U.S. Court of Appeals for the Second Circuit. In a May 30, 2023, opinion, a Second Circuit panel “reversed the district court's order holding that the Bankruptcy Code does not permit non consensual third-party releases against non-debtors, affirmed the bankruptcy court's approval of the Plan, and remanded the case to the district court for such further proceedings as may be required, consistent with this opinion.”

KFF Health News has created a tracker to follow the distribution of all of the opioid related settlement funds.  

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