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Purdue portends a change of bankruptcy venue laws

After agreeing to settle some 2,600 separate lawsuits over the company's involvement in fostering the nation's opioid crisis, Stamford-based Purdue Pharma, the maker of OxyContin, filed for bankruptcy protection in September 2019 — in White Plains, New York, of all places. After an intensely litigated bankruptcy case over a two-year period, Judge Robert D. Drain recently confirmed Purdue's plan of reorganization. Notably, the confirmed plan includes a wide-ranging bankruptcy settlement that will require the owners of the company, the Sackler family, to turn over approximately $4.5 billion of their fortune to address the deadly opioid epidemic. But the agreement includes a much-disputed condition: It largely absolved the Sackler family of Purdue's opioid-related liability.

Judge Drain approved the painstakingly negotiated plan that will end thousands of lawsuits brought by state and local governments, tribes, hospitals and individuals to address a public health crisis that has led to the more than 500,000 deaths nationwide. The settlement terms have been harshly criticized for shielding the Sackler family. They are receiving protections that are typically given to companies that emerge from bankruptcy, but not necessarily to third parties who, like the Sacklers, did not themselves file for bankruptcy.

Read the full article here for an in-depth review of the Purdue Pharma case and its impact on bankruptcy venue laws.

Categories: Bankruptcy, Venue Reform