Purdue Pharma judge says Sacklers faces ‘substantial risk’ of liability

Aug 23 (Reuters) – The judge overseeing the bankruptcy of Purdue Pharma said on Monday that some members of the Sackler family who own the maker of OxyContin face a “substantial risk” of liability and could be forced to pay ” huge sums of money “for claims the company has fueled the opioid epidemic.

U.S. bankruptcy judge Robert Drain in White Plains, New York, made the remark during final argument in a lawsuit over Purdue’s proposed reorganization plan.

“I think there is a substantial risk that the Sacklers, or some of them, will be held responsible for huge sums of money,” said Drain, who added that “the question is where you draw the line “.

Under the deal, which Purdue says is worth more than $ 10 billion, the Sacklers would contribute around $ 4.5 billion and have legal protections against future opioid litigation.

Drain did not explicitly state how he would decide, but suggested he found the deal sufficient. But he urged lawyers for the Sacklers and the nine states opposing the deal to continue settlement talks over the next two days.

More than 500,000 Americans have died since 1999 from opioid overdoses, according to the United States Centers for Disease Control and Prevention.

Drain told Assistant US Attorney Lawrence Fogelman that it would be “foolish” to dismiss billions of dollars from the Sacklers just because it is not enough to solve the entire opioid crisis in the United States.

The judge is expected to render a formal ruling on the deal this week.

The money would go to various entities and individuals with opioid claims, as well as state and local opioid reduction programs.

Critics of the regulation argue that the disclaimers are too broad.

A lawyer representing the states of Washington and Oregon, which oppose the plan, told Drain on Monday that approving the deal would be a “historic mistake.”

The judge also said appellate courts generally support the types of releases the Sacklers would receive if they met certain standards.

At the start of Monday’s hearing, a lawyer for the Sacklers said they had agreed to restrict judicial releases to exclude family protections from non-opioid claims.

But the heart of the releases, protecting the Sacklers from opioid litigation, remains intact.

In testimony last week, members of the Sackler family said they would not contribute if they did not receive the releases.

Reporting by Maria Chutchian in New York; Editing by Noeleen Walder, David Gregorio and Peter Cooney

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