The Justice Department is continuing to fight in federal appeals court over controversial liability releases that would shield Purdue Pharma LP’s Sackler family owners from opioid litigation, threatening the family’s $6 billion settlement with state attorneys general, WSJPro reported. The U.S. Trustee Program on Friday urged a federal appeals court to affirm the unlawfulness of legal releases protecting the Sackler family members who own Purdue, the bankrupt OxyContin manufacturer. The U.S. Trustee argued that such releases aren’t permitted by U.S. bankruptcy law, which Purdue and the Sacklers dispute. The releases at issue are controversial because they would have released Sackler family members, who aren’t in bankruptcy, from civil opioid lawsuits even though some state attorneys general didn’t support an earlier settlement they had offered. While the appeal was pending, the Sacklers won support from all states by agreeing to increase their settlement offer to between $5.5 billion and $6 billion. However, if the appeals court sides with the U.S. Trustee, the higher settlement won’t go into effect, potentially delaying or jeopardizing funding for anti-addiction programs nationwide, according to court papers. Judge <b>Robert Drain</b>, who is overseeing Purdue’s chapter 11 case, approved the higher settlement earlier this month. He criticized the U.S. Trustee for challenging the revised deal, calling it “reprehensible” and “just not right.” A government lawyer said in response that the U.S. Trustee was defending the Bankruptcy Code and the rule of law by challenging the Sackler settlement.
