The US Supreme Court has ruled against a bankruptcy plan that would have shielded the Sackler family from legal liability.
On Thursday, the court ruled against an estimated $US6 billion Purdue Pharma bankruptcy plan that would have shielded the Sackler family – which owned and controlled the company – from legal liability. The company, but not the family, sought bankruptcy protection in 2019 in exchange for contributions to a global settlement deal.That settlement would have forever protected the Sacklers – as well as hundreds of affiliates and other Purdue Pharma insiders – from all opioid-related civil claims.
But bankruptcy is increasingly used — and, some critics allege, abused — by wealthy corporations and defendants threatened by costly lawsuits instead of traditional debts. The ruling represented a victory for President Joe Biden's administration, which had challenged the settlement as an abuse of bankruptcy protections meant for debtors in financial distress, not people like the Sacklers.
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