Endo International’s restructuring plan offers creditors a choice to continue legal battles against the opioid maker and related parties, an option not available in other recent bankruptcy plans that have faced legal challenges for taking away the right to sue, WSJ Pro Bankruptcy reported. Endo’s plan, which aims to resolve a multitude of personal-injury claims stemming from the impact of the opioid maker’s painkillers and other products, would pay more to creditors who agree to relinquish litigation rights. But those who want to continue fighting for more money in court would be allowed to do so if they accept a smaller upfront payment. This two-tiered payout option was added to Endo’s chapter 11 plan after a creditors committee rejected an earlier offer to pay only those who agreed to sign legal releases, and as bankruptcy plans granting such broad releases to companies — and to related third parties not in bankruptcy — have faced scrutiny. Malvern, Pa.-based Endo filed for bankruptcy in 2022 under the weight of thousands of lawsuits from individuals, state and local governments, and private institutions that alleged the company’s Opana ER painkiller helped fuel the nation’s opioid epidemic. Unlike most chapter 11 plans addressing similar personal-injury litigation that have been approved, Endo’s plan won’t provide blanket releases to third parties such as company executives and lenders that aren’t in bankruptcy themselves, lawyers involved in the case said. Instead, Endo’s restructuring plan contains a provision that allows its creditors, including thousands of people who suffered the effects of the opioid epidemic, to continue to litigate against the company, its executives and the lenders who would become the new owners of the restructured company after bankruptcy. The creditors would receive higher monetary awards if they choose to sign away their right to sue.
