Purdue Pharma LP yesterday defended a $4.5 billion settlement with the drugmaker’s Sackler family owners, saying that the proposed deal averts a long, costly legal fight to access family wealth housed overseas and in hard-to-reach trusts, WSJ Pro Bankruptcy reported. Marshall Huebner, a lawyer representing Purdue, said during closing arguments of a trial scrutinizing the settlement that the company believes it has strong legal claims against the Sacklers, including clawing back transfers made to the family before Purdue’s 2019 bankruptcy filing. But even if the lawsuits were successful, Huebner said, collecting any judgments in excess of the $4.5 billion provided by the settlement would be hard because the Sacklers have wealth and assets in trusts, and some family members live overseas. Settling with the Sacklers is a cornerstone of Purdue’s broader plan to exit chapter 11 as a new public benefit company while cutting ties to its founding family. The alternative of lengthy and expensive lawsuits would be “litigated to the bitter end by the Sacklers,” Huebner said. A committee representing Purdue’s unsecured creditors also said that recovering any potential judgment would pose additional difficulties because many of the family’s assets are in overseas trusts. The benefits of settling with the Sacklers, rather than pursuing them through litigation, was part of the company’s final defense of its reorganization plan. Judge Robert Drain of the U.S. Bankruptcy Court in White Plains, N.Y., is expected to decide within days whether to approve the settlement, which has broad support from groups representing personal injury claimants, governments and most states. Settlement funds would be used to fund opioid abatement programs across the country.
