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As the U.S. Supreme Court on Monday weighed the legality of Purdue Pharma’s bankruptcy settlement, some relatives of opioid victims converged on Washington to voice their frustrations with the process.
The settlement involving Purdue Pharma, maker of the prescription painkiller OxyContin, landed at the Supreme Court because it gives members of the Sackler family, who previously controlled the company but did not individually file for bankruptcy, some broad protections against civil claims that could be brought by people who never agreed to the deal. The U.S. Trustee, a bankruptcy-system watchdog within the Department of Justice, asked the Supreme Court to hear the case, arguing that bankruptcy law doesn’t allow such liability shields for people who have not filed for bankruptcy themselves.
During oral argument Monday, several justices raised questions about the U.S. Trustee’s challenge to the settlement, given that the overwhelming majority of creditors who voted on the agreement supported it.
“The views of the opioid victims and their families doesn’t matter?” Justice Brett Kavanaugh asked deputy solicitor general Curtis Gannon, who argued the government’s side on Monday.
“I’m not saying it doesn’t matter,” Gannon replied, adding that there are other opioid victims with “heartbreaking and tragic losses that are saying, ‘We are not consenting to have our property rights forcibly extinguished in this way.’”
Fewer than 20% of the more than 618,00 eligible claimants voted on the plan, according to a court filing by the U.S. Trustee. And some of those who voted against it made a point of traveling to D.C. for the court session Monday.
Among them was Cynthia Munger of Wayne, Pa., whose son developed substance-abuse issues after being prescribed OxyContin for a baseball injury while he was in high school. Munger said she voted against the settlement largely because of the liability protections it gave the Sacklers. “I don’t care about seeing a penny” from the settlement, Munger said. She just wants the Supreme Court “to recognize what is obvious, which is these releases are illegal.”
The whole process has been “a travesty,” Munger said. “I’m overwhelmed with the sadness and unfairness of it all.”
Lawyers for Sackler family members did not respond to requests for comment.
Purdue Pharma said in a statement that it is pleased to have had the opportunity to demonstrate to the Supreme Court that its reorganization plan is “solidly grounded in legal precedent. Our creditors, who insisted on the third-party releases at issue and overwhelmingly support our plan, further underscored to the court that this plan is the only way to deliver billions of dollars toward lifesaving opioid abatement programs and victim compensation.”
The creditors insisted on the release applying to all creditors of Purdue “to ensure that no creditor could recover disproportionately at the expense of others,” the official committee of unsecured creditors said in a filing with the Supreme Court.
Purdue Pharma has also said that the plan could provide more than $10 billion for opioid-abatement programs nationwide.
Before the Supreme Court session began Monday, dozens of family members and activists gathered outside the court to protest the settlement, carrying photos of loved ones lost to the opioid epidemic. Other family members lined up at the court at 5 a.m., hoping for a chance to get a seat inside the courtroom.
Ed Bisch of Westampton, N.J., whose son died of an overdose in 2001, traveled to D.C. for the hearing Monday and wants to see the Supreme Court strike down the liability releases. If the court allows such legal protections, “it will allow the worst of the worst to use it as a shield to hide behind,” said Bisch, who founded an advocacy group called Relatives Against Purdue Pharma. He voted against the settlement, he said, and many others didn’t vote at all “because everybody knew the victims were going to get screwed.”
Purdue Pharma has said that the voting results were “an unprecedented expression of support for a restructuring of this size and complexity.”
Sue Crathern, whose son died of a fentanyl overdose in 2019, said she feels she’s been strung along for years by the legal process. She tried to jump through every hoop to provide documentation for her claim, reliving painful memories along the way, she said, only to be told this spring that she hadn’t provided the necessary documentation that Purdue-manufactured opioids caused the harm to her son. “At that point I put everything down and cried and walked away,” said Crathern, a chemist who lives outside Philadelphia.
Many claimants had no idea when they first got involved in the process about all the documentation that would be required, Munger said. “We lived in the real world,” she said, where kids were buying opioids “off the streets” — making documentation difficult.
Edward Neiger of ASK LLP, a law firm representing a large group of Purdue Pharma claimants, said that “producing evidence of the use of a Purdue product is the minimal degree necessary to prove that a victim was harmed by Purdue,” as opposed to other opioid manufacturers. “We have tried to make it as easy as possible” for victims to file claims, he said, adding that those who struggle to access old medical records can provide affidavits from close friends or family members attesting that the victim was prescribed OxyContin or another Purdue opioid.
Monday’s hearing didn’t have any “slam dunks for either side,” said William Organek, assistant law professor at Baruch College’s Zicklin School of Business and managing editor of the Harvard Law School Bankruptcy Roundtable. Yet the oral argument seemed to leave the door open to a decision that goes beyond the traditional liberal-conservative divide, he said, as some more conservative justices questioned the idea of taking away people’s right to sue without their consent, and some more liberal justices expressed discomfort with the Sacklers getting to decide how much to contribute to the settlement in exchange for the civil liability releases.
The justices put considerable emphasis not only on what the bankruptcy code allows, said Pamela Foohey, bankruptcy law professor at Cardozo School of Law, but also on “what is at stake here for people who are pulled unwittingly, unknowingly into the bankruptcy process.”
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