Throwing out the $4.5 billion settlement with Purdue Pharma is the right call

A federal judge’s decision to overturn a $4.5 billion settlement between Purdue Pharma and assorted state, local, and tribal governments is the right call. The settlement wrongly shielded the billionaire Sackler family, who owned the company that made the prescription painkiller OxyContin, from any and all civil liability in opioid-related tragedies.

As reported by The New York Times, the settlement was part of a complex restructuring plan for Purdue Pharma that was approved in September by a bankruptcy judge. But Judge Colleen McMahon of the US District of New York pulled the plug on it, because it protected the Sackler family from future civil lawsuits. After the Sacklers took more than $10 billion out of it, Purdue Pharma filed for bankruptcy. The Sacklers, who did not file for personal bankruptcy, offered to contribute toward the original settlement, “if – and only if – every member of the family could ‘achieve global peace’ from all civil [not criminal] litigation,” the judge wrote. And that, she said, was wrong. She did, however, also call the legal issue of the Sacklers’ release “a great unsettled question” of bankruptcy law and wrote, “This opinion will not be the last word on the subject, nor should it.”

McKinsey Settles for Nearly $600 Million Over Role in Opioid Crisis

McKinsey & Company, the consultant to blue-chip corporations and governments around the world, has agreed to pay nearly $600 million to settle investigations into its role in helping “turbocharge” opioid sales, a rare instance of it being held publicly accountable for its work with clients.

The firm has reached a $573 million agreement with attorneys general in 47 states, the District of Columbia and five territories, according to a court filing in Massachusetts on Thursday. Separate deals were announced in Washington State, for $13 million, and in West Virginia, for $10 million. Nevada, not party to the agreements, will continue to pursue its opioid investigation, according to the attorney general’s office.

The settlements come after lawsuits unearthed a trove of documents showing how McKinsey worked to drive sales of Purdue Pharma’s OxyContin painkiller amid an opioid crisis in the United States that has contributed to the deaths of more than 450,000 people over the past two decades.

Rite Aid settles bellwether opioid case with Ohio counties

Rite Aid Corp affiliates have settled claims by two Ohio counties that it contributed to the opioid addiction epidemic, just over a month before the case was set to go to trial.

The pharmacy chain operator and Lake and Trumbull counties disclosed the settlement in a motion filed Wednesday in federal court in Cleveland, Ohio, to sever Rite Aid from the case. They did not reveal terms of the deal, which must be approved by Lake County Commissioners and Trumbull County Commissioners.

U.S. District Judge Dan Polster granted the motion on Thursday.

Purdue Pharma Seeks Bankruptcy Protection

Purdue Pharma has filed for Chapter 11 bankruptcy protection as part of a plan for settling some of the opioid-related litigation it faces in federal and state courts across the country.

These settlements have an estimated value of more than 10 billion dollars.

The company has announced the agreement in principle for the settlement framework with 24 state attorney generals, officials from 5 United States territories, the Plaintiffs’ Executive Committee in the multidistrict litigation (MDL), and co-lead counsel in the MDL. The parties included in this agreement in principle represent some of the more than 2600 lawsuits filed against Purdue Pharma concerning opioids, including the company’s OxyContin products.

The more than 2600 civil actions filed against Purdue Pharma generally allege that the company engaged in deceptive and false marketing tactics to sell its opioid products and is liable for the ongoing national opioid crisis.

Purdue Pharma has denied claims made against the company in these lawsuits.

The Opioid Litigation: Settlements, Winners, and Losers

As the fall approaches, anticipation is growing for a breakthrough in the National Prescription Opiate Litigation, the 1,800 combined cases before Judge Dan Polster. The cases accuse Purdue Pharma and other drug manufacturers, along with drug distributors like McKesson, AmerisourceBergen, and Cardinal Health and national pharmacies of responsibility for opioid-related harm.

With the first trial in this behemoth case just months away (October 2019), the expectation has been that the opioid litigation will follow the patterns of previous high-profile cases like Big Tobacco or the NFL Concussion cases, reaching a comprehensive settlement before trial. Though Judge Polster has kept the underlying facts out of public view by allowing the defendants to file materials under seal, the parties have made noteworthy efforts to publicize an anticipated settlement framework.

The proposal would pull nearly 25,000 cities and counties nationwide (of whom roughly fewer than 7% are currently parties to the litigation) into a negotiation class, betting that few would opt out based on litigation costs. The theory is that this would give the defendants some security by foreclosing the possibility of future suits by municipalities not yet participating in the proceedings. The differential share of opioid harms at different times and places around the country could be allocated with an interactive map establishing each local government’s expected share of any proposed settlement.

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