This is very good news. Consequences -- finally for the runaway winners -- of the 2021 Shkreli Award, for bad pharmaceutical behavior.
Here's the just breaking good news (the opinion in full) -- and a bit:
. . .The bankruptcy code contains hundreds of interlocking rules about “‘the relations between’” a “‘debtor and [its] creditors.’” Wright v. Union Central Life Ins. Co., 304 U. S. 502, 513–514 (1938). But beneath that complexity lies a simple bargain: A debtor can win a discharge of its debts if it proceeds with honesty and places virtually all its assets on the table for its creditors. The debtor in this case, Purdue Pharma L. P., filed for bankruptcy after facing a wave of litigation for its role in the opioid epidemic. Purdue’s long-time owners, members of the Sackler family, confronted a growing number of suits too. But instead of declaring bankruptcy, they chose a different path. From the court overseeing Purdue’s bankruptcy, they sought and won an order extinguishing vast numbers of existing and potential claims against them. They obtained all this without securing the consent of those affected or placing anything approaching their total assets on the table for their creditors. . . .
Purdue sits at the center of these events. In the mid1990s, it began marketing OxyContin, an opioid prescription pain reliever. 69 F. 4th, at 56. Because of the addictive quality of opioids, doctors had traditionally reserved their use for cancer patients and those “with chronic diseases.” 635 B. R., at 42. But OxyContin, Purdue claimed, had a novel “time-release” formula that greatly diminished the threat of addiction. Ibid. On that basis, Purdue marketed OxyContin for use in “‘a much broader range’” of applications, including as a “‘first-line therapy for the treatment of arthritis.’” Ibid.
Purdue was a “‘family company,’” owned and controlled by the Sacklers. Id., at 40. Members of the Sackler family served as president and chief executive officer; they dominated the board of directors; and they “were heavily involved” in the firm’s marketing strategies. 69 F. 4th, at 86 (Wesley, J., concurring in judgment). They “pushed sales targets,” too, and “accompanied sales representatives on ‘ride along’ visits to health care providers” in an effort to maximize OxyContin sales. 635 B. R., at 50. . . .
Appreciating this litigation “would eventually impact them directly,” id., at 59, the Sacklers began what one family member described as a “‘milking’ program,” 635 B. R., at 57. In the years before the 2007 plea agreement, Purdue’s distributions to the Sacklers represented less than 15% of its annual revenue. Ibid. After the plea agreement, the Sacklers began taking as much as 70% of the company’s revenue each year. Ibid. Between 2008 and 2016, the family’s distributions totaled approximately $11 billion, draining Purdue’s total assets by 75% and leaving it in “a significantly weakened financial” state. 69 F. 4th, at 59. The Sacklers diverted much of that money to overseas trusts and family-owned companies. . . .
Held: Reversed. Yes, this means some aging victims and families may die before getting a recovery at all, for the damages. But it cannot be that the Sacklers would be allowed to keep about $6 billion -- where they personally made well over $20 billion in net income, off the debacle. At some point, even billionaires are bound by the same rules the rest of us are, in businesses -- of any kind. Onward -- satisfied. . . on a perfectly sunny summer morning here!
नमस्ते
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