Sacklers Face Consequences as Judge Reviews Settlement Deal, Emails Come Out

30 Dec, 2021 Liz Carey


Emails released as part of the federal government’s deal with Purdue Pharma and the Sackler family indicate that Richard Sackler knew about the addictive nature of oxycodone as early as the 1990s. 

The email release is part of a roughly $4.5 billion settlement between the federal government and Purdue Pharma and the Sackler family, that was recently rejected by a federal judge. 

In October 2020, the U.S. Department of Justice under the Trump administration announced that it had reached a deal with Purdue Pharma and the Sackler family over the more than 2,000 state, local and municipal suits against it because of the opioid crisis. 

According to the deal, Purdue Pharma would plead guilty to three felony counts - to defraud the United States, to violate the Food, Drug and Cosmetic Act, and to violate the Federal Anti-Kickback Statute. The resolution included a criminal fine of $3.544 billion, as well as $2 billion in criminal forfeiture. Purdue also agreed to a civil settlement of $2.8 billion to resolve civil liabilities under the False Claims Act. 

The agreement shielded the Sackler family from any future opioid lawsuits, and dissolved Purdue Pharma’s opioid company, recreating it as a public benefit corporation. The agreement also required the company to release millions of emails. 

In September 2021, under the Biden administration, the U.S. Department of Justice sought to overturn the deal that shielded the Sacklers from future litigation. Approved by Judge Robert Drain on Sept. 1, 2021, the deal granted the family that owns the drug company immunity after they agreed to contribute roughly $4.3 billion of the family’s fortune to the deal. The family is estimated to be worth more than $11 billion. 

State attorneys general said the settlement would avoid costly litigation while funding drug treatment programs over the next decade. But William Harrington, the U.S. trustee for the Justice Department, filed documents requesting an “expedited stay” to prevent the implementation of the settlement. Harrington said the Sacklers used the bankruptcy system to avoid liability for “alleged wrongdoing in concocting and perpetuating for profit one of the most severe public health crises ever experienced in the United States.” 

On Dec. 16, U.S. District Judge Colleen McMahon overturned the New York bankruptcy court approved settlement saying that the bankruptcy court did not have the authority to grant the Sacklers legal protection from future opioid litigation. 

Purdue said it would appeal the decision. 

"While the district court decision does not affect Purdue’s rock-solid operational stability or its ability to produce its many medications safely and effectively, it will delay, and perhaps end, the ability of creditors, communities, and individuals to receive billions in value to abate the opioid crisis," Purdue Chairman Steve Miller said in a statement. 

The Sacklers had insisted on the legal shields, and had threatened to walk away from the settlement talks, without the guaranteed legal protections. 

U.S. Attorney General Merrick Garland said he was pleased with the ruling. 

"The bankruptcy court did not have the authority to deprive victims of the opioid crisis of their right to sue the Sackler family," Garland said in a statement. 

Several state attorneys general allege the Sacklers authorized financial transfers from Purdue to the Sackler family to prevent money from being drained from the company during litigation. The Sacklers have denied the allegation, saying the money went toward taxes and investments. 

At the same time, the Metropolitan Museum of Art and the Sacklers announced an agreement to remove the Sackler name from seven exhibition spaces. Families who have been victims of the opioid crisis have also called on the British Museum, the Victoria and Albert Museum, the National Gallery and the Tate to remove the family’s name from its buildings, and for Dame Theresa Sackler, the widow of Mortimer Sackler, to be stripped of her title. The move comes after a judge in Britain ruled that the Sackler family could be held accountable for the harm it caused the drug’s users. 

Emails released as part of the settlement indicate that Richard Sackler knew about the addictive nature of oxycontin as early as the late 90s, just as the drug was being released on the market.

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    About The Author

    • Liz Carey

      Liz Carey has worked as a writer, reporter and editor for nearly 25 years. First, as an investigative reporter for Gannett and later as the Vice President of a local Chamber of Commerce, Carey has covered everything from local government to the statehouse to the aerospace industry. Her work as a reporter, as well as her work in the community, have led her to become an advocate for the working poor, as well as the small business owner.

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