California Attorney General Rob Bonta today filed a letter with the U.S. Supreme Court in a case arising from Purdue Pharma’s bankruptcy reorganization plan. Purdue Pharma is owned by the Sackler family and is the manufacturer of OxyContin, a powerful prescription opioid and key contributor to the opioid crisis. The case, which is scheduled to be argued in December, concerns the plan’s sweeping nonconsensual third-party releases, which shield the Sacklers from all private, opioid-related civil lawsuits. Attorney General Bonta has repeatedly voiced his concerns over the releases, asserting that they unfairly block victims harmed by the Sacklers’ misconduct from seeking justice in court.
“Purdue Pharma and the Sackler family bear responsibility for much of the grief and loss caused by the opioid crisis,” said Attorney General Bonta. “Those who suffered as a result of their misconduct deserve the option to seek justice in court against the Sacklers, who have not individually declared bankruptcy. They must not be blocked from doing so by bankruptcy releases to which they did not consent. California will continue to advocate and fight for justice, relief and healing for the countless families whose lives have been upended by the opioid crisis.”
Today’s letter, which explains why California will not be filing a brief in the case, also provides the court with information concerning the procedural history of the case, California’s settlement with the Sacklers, and California’s prior filings in the case. In those filings, California argued that nonconsensual third party releases are contrary to federal law, including as applied to state law enforcement claims, and that the Purdue bankruptcy plan therefore cannot be confirmed in its current form.
California’s settlement with the Sacklers was possible only because the California Department of Justice fought confirmation of the Purdue bankruptcy plan, which would have given the Sacklers protection from civil liability through non-consensual third-party releases. Once California and the state coalition objected to the plan, and prevailed on those objections in the district court, the Sacklers agreed to pay up to an additional $1.675 billion to be used for opioid abatement, and to provide other consideration, underscoring the harm nonconsensual third-party releases can cause.
Under the settlement, Purdue’s bankruptcy plan no longer provides the Sacklers with nonconsensual releases from state law enforcement claims. However, the plan still provides nonconsensual releases from private claims against Sackler family members by individuals directly harmed by their misconduct. This is not consistent with the law, and the Attorney General hopes for a path forward that would bring much-needed resources to impacted communities while ensuring that private parties who have been harmed by the Sacklers’ misconduct are allowed to have their day in court.
A copy of today’s letter can be found here.