Sacklers Balk at Chapter 11 Deal Without Litigation Injunction Extension

Posted on by Edward Lott

In a statement to the bankruptcy court on March 23, the family of Raymond Sackler advised that unless the injunction shielding the Sackler family from litigation was extended, they would withdraw their proposed $4.275 billion cash contribution to the settlement fund intended to address the ongoing opioid crisis. In response to that statement during a virtual hearing held on March 24, Judge Robert Drain of the US Bankruptcy Court for the Southern District of New York extended the injunction another 28 days – until April 21 – giving Purdue Pharma additional time to finalize the pending Chapter 11 plan.

The injunction was put in place in November 2019 and protects non-debtor parties, including members of the Sackler family from litigation; it has already been extended a number of times during the pendency of the Chapter 11 proceedings.

On March 16, Purdue Pharma filed its Chapter 11 plan of reorganization; the plan provides for the Sacklers to give up all ownership in the company as well as contribute almost $4.3 billion to a trust designed to address opioid-related claims and the family’s role in the opioid epidemic that has resulted in the deaths of over 450,000 Americans. Instead of the family, the company would be owned by the abatement trust and run for the public benefit.

A number of groups opposed the extension of the injunction –

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The post Sacklers Balk at Chapter 11 Deal Without Litigation Injunction Extension appeared first on Verus LLC.

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