Purdue Pharma can appeal rejection of bankruptcy planPosted On: Jan. 7, 2022 1:52 PM CST
(Reuters) – A U.S. judge on Friday allowed Purdue Pharma to immediately challenge her rejection of legal protections for Sackler family members who own the OxyContin maker, and which were a major component of its bankruptcy reorganization plan.
U.S. District Judge Colleen McMahon's ruling means Purdue will have another shot at keeping intact a $4.5 billion opioid litigation settlement at the heart of the company's plan. She gave Purdue until Jan. 17 to file the appeal to the New York-based 2nd U.S. Circuit Court of Appeals.
Judge McMahon reversed a bankruptcy judge’s order approving the deal in December. The settlement provides so-called nondebtor releases that shield the Sacklers against future opioid-related lawsuits.
Purdue filed for bankruptcy in 2019 in the face of thousands of lawsuits accusing it and the Sacklers of fueling the opioid epidemic through deceptive marketing.
The Sacklers, who have denied wrongdoing, contributed $4.5 billion to the settlement in exchange for the releases. Under Purdue’s reorganization plan, settlement funds would be directed toward opioid abatement programs.