The Supreme Court on Thursday blocked Purdue Pharma from going forward with bankruptcy proceedings, which the Biden administration has called an “unprecedented” arrangement that would ultimately offer the Sackler family broad protection from opioid-related civil claims.
In agreeing to pause the settlement, the court also said it would take up the case and hear arguments this December.
The case arose after the reorganization in bankruptcy of OxyContin manufacturer Purdue Pharma – stemming from litigation arising from claims over its role in fueling the opioid addiction crisis.
Until recently, Purdue was controlled by the Sackler family, who withdrew billions of dollars from the company before it filed for bankruptcy. The family has now agreed to contribute up to $6 billion to Purdue’s reorganization fund on the condition that the Sacklers receive a release from civil liability.
The government, representing the US Trustee, has called the plan “exceptional and unprecedented” in court papers, noting that lower courts have divided on when parties can be released from liability for actions that caused societal harm.
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