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A division of the Department of Justice that serves as a watchdog for the federal bankruptcy system filed an action Wednesday evening seeking to block Purdue Pharma’s controversial bankruptcy plan.
William Harrington, who serves as the US administrator for the Department of Justice, also filed documents calling for an “expedited stay” to prevent the settlement from being implemented.
The deal, which Judge Robert Drain approved on September 1, granted full immunity from opioid lawsuits to members of the Sackler family who own the drug company.
The Sacklers, who are not bankrupt, were released from liability after agreeing to contribute around $ 4.3 billion of their private wealth to the deal.
Supporters of the settlement, including most state attorneys general, said it would avoid costly litigation while funding drug treatment programs over the next decade.
But throughout a two-week bankruptcy lawsuit and in court documents, the Justice Department has repeatedly criticized the Sacklers’ disclaimers as “illegal” and “unconstitutional.”
In an earlier case, Harrington accused the Sacklers and their associates of using the bankruptcy system to avoid liability for “alleged wrongdoing in concocting and perpetuating for profit one of the world’s most serious public health crises. serious problems never known in the United States ”.
The introduction of OxyContin in the 1990s is widely seen as one of the spurs of an opioid epidemic that killed more than 500,000 people in the United States.
The Sacklers, who they say have made more than $ 10 billion from opioid sales, have said repeatedly that they have done nothing wrong and that they are acting ethically.
In new court documents filed on Wednesday, Justice Department attorneys said they feared certain provisions of Purdue Pharma’s bankruptcy plan could be implemented quickly, complicating an appeal.
“In requesting a stay of appeal, the objective of the United States administrator is to preserve the status quo for the duration of the appeal,” the document said.
The Justice Department has requested an expedited hearing within the next two weeks. The states of Maryland and Washington, as well as Washington, DC, have also filed appeals.
In approving Purdue Pharma’s bankruptcy this month, the judge described it as the best possible resolution to a case involving more than 600,000 parties who say OxyContin has hurt them.
“It’s a bitter result,” Drain said in his decision on September 1. “I think at least some of the Sackler parties are responsible for these [opioid OxyContin] complaints. … I would have expected a higher settlement. ”
Purdue Pharma has twice pleaded guilty to federal crimes related to its marketing of OxyContin. The Sacklers who ran the company said they had done nothing criminal or unethical.
Under this deal, if he survives the appeal, the Sacklers would again not admit any wrongdoing.