State AG lauds decision by judge to overturn Purdue settlement as victory in opioid fight

In a decision Washington Attorney General Bob Ferguson calls a major victory for the state, a federal judge in New York has overturned the bankruptcy settlement of OxyContin maker Purdue Pharma, stemming from thousands of lawsuits it faced over the opioid epidemic.

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“This is a very significant win for the state of Washington,” said Ferguson, who was leading the court battle on behalf of Washington state and several others, and had rejected a $4.5 billion settlement deal.

“We are challenging this bankruptcy resolution that allows the Sackler family billionaires to graft on to this Purdue pharmaceutical bankruptcy,” Ferguson said in a phone interview with KIRO Radio, shortly after the decision came down. “And in exchange for putting in some money, they got a legal shield for life — we just said that’s not fair, you can’t have two forms of justice, one for the wealthy who can buy immunity and one for everybody else. This federal judge agreed with us in a 142-page opinion, and this just really changes the game on this bankruptcy.”

In her ruling, U.S. District Judge Colleen McMahon focused on the part of the settlement that shielded the Sackler family from future lawsuits over the opioid epidemic, finding that federal bankruptcy law does not give the bankruptcy judge the authority to grant such release for people who are not declaring bankruptcy themselves.

“This opinion from this federal judge today is a complete and total vindication for the state of Washington, and rejects this, frankly, morally bankrupt and legally bankrupt bankruptcy plan,” said Ferguson, who expects an immediate appeal from the Sacklers.

Purdue was facing thousands of lawsuits when it decided to file for bankruptcy protection, before it reached a settlement that would have allowed the Sackler family to retain the profits they made off manufacturing opioids such as OxyContin, which the lawsuits accuse the company – and some family members — of intentionally pushing doctors to prescribe while underplaying its addictive qualities. Purdue and the Sacklers deny those claims.

“What’s likely to happen from here is you’ll see Purdue pharmaceutical and the Sacklers, I anticipate, will merely file for an appeal, so the next stage they do would be the Second Circuit Court of Appeals, and we’d be before a three judge panel, who would review this trial court decision — after that, of course, the United States Supreme Court,” Ferguson explained.

The Sackler family has said it will file an appeal, and also criticized the judge overturning the settlement for denying those suffering due to the opioid crisis access to their portion of the $4.5 billion settlement.

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Ferguson does believe the case will ultimately play out in front of the U.S. Supreme Court.

“I think so — this is a huge case, and that’s understating it,” he noted. “It’s not just the billions of dollars, but it’s also accountability for the Sackler family and their role in fueling the opioid epidemic that made them billionaires.”

“What they did was not OK, and they cannot buy a legal shield for life just because they happen to be really, really wealthy,” he added.

“To be clear, they have enough that even after they pay a few billion dollars under the bankruptcy, they’ll be wealthier at the end of that than they are today — that’s how wealthy they are,” Ferguson continued. “We just felt that that’s not right. It’s just not OK for the victims of the opioid epidemic.”

As for what all of this means for those hit hardest by the opioid epidemic in Washington state, he says “the fight is definitely not over.”

“In fact, now we have the momentum with this 142-page opinion that, frankly, upholds everything we argued before this judge, and upholds everything we said was wrong with this morally bankrupt bankruptcy plan put in place by a judge in New York,” Ferguson said. “So it’s a great day for Washington state and, frankly, for Americans who want a more legal justice system.”

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