Sackler family / Purdue Pharma: bankruptcy as liability shield

Purdue Pharma, owned by branches of the Sackler family, marketed OxyContin starting 1996 and pleaded guilty to misbranding in 2007. Between 2008 and 2017 — the years opioid litigation accelerated — the Sackler family extracted approximately $10.7B in distributions from Purdue (per Sept 2019 court-appointed monitor report and subsequent SDNY filings). Purdue filed for Chapter 11 in Sept 2019. The reorganization plan negotiated in bankruptcy court would have channeled victim claims into a settlement trust and released the individual Sacklers — who had not themselves filed for bankruptcy — from related civil liability. In June 2024 the U.S. Supreme Court ruled 5-4 in Harrington v. Purdue Pharma L.P. that the Bankruptcy Code does not authorize such non-consensual third-party releases. The case is the canonical documentation of how Chapter 11 was being used to insulate non-debtor controlling owners from personal exposure.