US Attorneys General from 24 states and Washington, D.C. launched a lawsuit against Purdue Pharma this week in an attempt to block the OxyContin maker from avoiding thousands of lawsuits after filing for bankruptcy, Reuters reported.
The state officials objected to Purdue Pharma’s request that a U.S. bankruptcy judge block the more than 2,600 lawsuits seeking billions in damages, according to court filings, Reuters reported.
The lawsuits argue that the company, along with the Sackler family, were a catalyst in the opioid crisis across the country by not disclosing the addictive risks of opioids.
“The Sacklers are billionaires, they are not bankrupt,” the Massachusetts attorney general, Maura Healey, told Reuters. “They should not be allowed to use the filing to shield their assets.”
Purdue filed for chapter 11 bankruptcy last month, after reaching a settlement between $10 billion and $12 billion for the thousands of plaintiffs involved in the lawsuits. The committee of attorneys who negotiated the settlement said the filing will not stop the company from finalizing the settlement.
But Purdue sought the injunction to stop the lawsuits against the company because the Sackler family did not file for bankruptcy, Reuters reported. The Sacklers have offered to give control of Purdue to the plaintiffs and give at least $3 billion towards the settlement.
The case filed this week by the state attorneys general also said Purdue gave up to $13 billion in company profits to the Sackler family.
Although court documents and a deposition from a company advisor taken last week said the family received the money over an unspecified time frame, states still pointed to the money as one reason why the family should pay more of the settlement, according to Reuters.
“The distribution numbers do not reflect the fact that many billions of dollars from that amount were paid in taxes and reinvested in businesses that will be sold as part of the proposed settlement,” Daniel Connolly, a lawyer for some Sackler family members facing lawsuits, said in a statement to Reuters.
According to Purdue, it needs to cease litigation against it temporarily in order to settle with plaintiffs and preserve money that would be spent on legal fees, Reuters reported. Purdue said it has already spent nearly $250 million on legal fees this year.