Purdue Pharma bankruptcy judge compares Sacklers to Scrooge McDuck
- A judge in the Purdue Pharma bankruptcy case said the company’s wealth cannot be tied to a single person.
- “There isn’t a single Scrooge McDuck, there is a lot,” said Judge Robert Drain.
- If approved, the settlement would give the Sacklers immunity from future opioid-related lawsuits.
- See more stories on the Insider business page.
A judge overseeing a landmark bankruptcy hearing involving Purdue Pharma, the maker of the opioid OxyContin, said the company’s wealth cannot be tied to a single person.
Judge Robert D. Drain of the New York Southern District Bankruptcy Court heard from attorneys for Purdue Pharma and creditors seeking a bankruptcy settlement with the company. The May 26 hearing was intended to allow parties to raise objections to the disclosure deal proposed by Purdue Pharma, which provides information about its finances to help creditors make an informed decision on the settlement plan.
During the hearing, representatives from the Justice Department’s Trustees Group and a committee of 24 unwilling U.S. states asked to include more details about the finances of the Sacklers, the billionaire family who founded Purdue Pharma.
“It’s not like, as I understand it, Scrooge McDuck who just took a bath in some money chests he has in his apartment,” Justice Drain said. “There isn’t a single Scrooge McDuck, there are many.”
During the May 26 hearing, a lawyer for the US Trustees Program asked Purdue Pharma to explain why the settlement payment would take nine years to deliver and not be paid in a lump sum.
Although Forbes estimates the The net worth of the Sackler family at $ 10.8 billion in 2020, Darren S. Klein, a Davis Polk & Wardwell attorney representing Purdue Pharma, said during the lawsuit that family members have different wealth based on their ties to the company .
“There was very detailed financial diligence on individual wealth and
individual Sackler pods, which is why each [side of the family] has a slightly different set of guarantees and a slightly different set of clauses, “Klein said.” I think it’s the debtor’s settlement and our job is to show that it’s reasonable, and not in fact to publish every piece of information.
But lawyers for Davis Polk & Wardwell have agreed to include more details about the Sackler family’s enormous wealth in the disclosure agreement.
“We are delighted to add other words that the Sacklers would tell us if they believed that what Congress said to have been submitted by the Sacklers is not correct,” Klein said, referring to a Congress report this showed that the wealth of the Sackler family was $ 11 billion. “We are happy to.”
If approved by the court, the bankruptcy settlement would require the Sackler family to pay $ 4.2 billion to victims of the opioid crisis and relinquish control of Purdue Pharma, lawyers for Purdue Pharma said in of the trial. But Brian Mann of NPR reported that the settlement would give the Sackler family immunity from any future opioid litigation.
State governments, school districts, Native American tribes and doctors have submitted objections to the disclosure agreement ahead of the hearing, according to documents filed by the court.
The litigation surrounding Purdue Pharma has caused a rift between the various members of the Sackler family, detailed Patrick Radden Keefe in his book “Empire of Pain: The Secret History of the Sackler Dynasty”.
Although Arthur Sackler founded Purdue Pharma in 1952, his former brothers Mortimer and Raymond took control of the company after Arthur’s death in 1987. Raymond Sackler’s son, Richard, was chairman of the board of directors which guided Purdue Pharma through the approval and initial publication of OxyContin in December 1995.
OxyContin was the “most prescribed brand name narcotic drug” for the treatment of moderate to severe pain in 2001, according to a report by the US Government Accountability Office. Prescription Opioid Overdose Deaths quadrupled between 1999 and 2019, and the Centers for Disease Control and Prevention recorded 247,000 prescription opioid overdose deaths over the past two decades.