After OxyContin manufacturer Purdue Pharma filed for Chapter 11 bankruptcy in 2019, members of the Sackler family, which controlled the company, arranged a resolution that included personal protection from civil liability for contributing to opioid-related deaths. That shield was part of a mass settlement that promised myriad litigants a total of $6 billion.
The Supreme Court narrowly rejected that deal today. "The bankruptcy code does not authorize a release and injunction that, as part of a plan of reorganization under Chapter 11, effectively seeks to discharge claims against a nondebtor without the consent of affected claimants," Justice Neil Gorsuch writes for the majority in Harrington v. Purdue Pharma, which overturns a contrary 2023 ruling by the U.S. Court of Appeals for the 2nd Circuit.
