By: Donald L Swanson
Back in September of 2021, a super-majority of voting plaintiffs (95%) supported confirmation of the Purdue Pharma bankruptcy plan. Under the plan, the Sackler family would contribute $6.0 billion to pay plaintiffs.
The plan was confirmed by the Bankruptcy Court, and the super-majority of voting plaintiffs expected to receive their settlement money shortly thereafter.
Confirmation was postponed, however, by appeals.
The U.S. Supreme Court ultimately reversed the plan confirmation order and sent everyone back to the drawing board. And the 93% super-majority of voting plaintiffs have yet to see any money.
Reports of New Offer
Reports are circulating that in January of 2025, the Sackler family members increased their September 2021 Purdue Pharma offer of $6.0 billion (under their bankruptcy plan) by $1.4 billion—up to $7.4 billion. See, e.g., this linked article.
If that’s accurate, the new Sackler family offer is a 23% increase over the prior plan amount. And that increase has taken 3+ years to occur. That’s the interval between (i) the time the 95% super-majority of voting plaintiffs supported confirmation of Debtor’s bankruptcy plan back in 2021, and (ii) to the present.
Hypothetical
Let’s say you are a plaintiff with a claim against Purdue Pharma.
And let’s say you voted with the 95% super-majority of plaintiffs to accept the $6.0 billion plan amount back in September of 2021, with the expectation of a prompt plan confirmation and that you would get your settlement money shortly thereafter.
Let’s say, further, that $150,000 is the amount of money you were scheduled to receive under the confirmed plan—and that you had immediate plans for putting that money to use.
Unfortunately, your immediate plans were dashed by the U.S. Supreme Court, and you are still waiting for a revised arrangement that will get you your money.
Fortunately, there is now a new proposal to increase the amount you were to receive by 23%. That means, presumably:
- instead of getting $150,000 three-plus years ago;
- you are scheduled to receive under the new proposal a sum of 23% more: that’s $184,000.
Rate of Inflation
According to the US Inflation Calculator, the rates of inflation from 2021 through 2024 are:
- 2021 – 7.0%
- 2022 – 6.5%
- 2023 – 3.4%
- 2024 – 2.9%
That means this:
- the 23% Purdue Pharma increase since September of 2021 has barely kept pace with inflation; and
- the 23% Sackler family increase is, roughly, an inflation-adjusted maintenance of the value you were to receive shortly after confirmation of the plan back in 2021; but
- the new amount is not yet approved, and you are still waiting to get your share–with no indication of how long that will take.
Conclusion
Not allowing the 95% super-majority plaintiffs to to get the plan confirmed and to receive their settlement money, back in 2021, has been a bad deal for those plaintiffs who wanted prompt payment of the amounts they voted to accept.
For those who wanted more money and are happy to wait, the delay is working fine . . . and is likely to continue working to get more money as delays continue.
For those who wanted a greater level of pain and retribution against the Sackler family, the delay has been well worth the effort and the wait . . . and further time and pressure are likely to produce more pain to that family. So, the delay so far, and any continuing delays, are a win.
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