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The state of Arizona has recently filed a lawsuit at the U.S. Supreme Court against OxyContin maker Purdue Pharma and the family that owns it – the Sackler family. The court filing marks the first time the high court has been asked to weigh in directly on the nation’s opioid crisis.
Unlike previous opioid lawsuits citing Purdue, Arizona Attorney general Mark Brnovich is targeting eight members of the family, accusing them of intentional fraudulent conveyance and constructive fraudulent conveyance. According to the state, the Sacklers took billions of dollars from Purdue, both as payments to themselves and transfers to other companies. The family moved this money despite the fact that they knew the company faced crippling liability over its deceptive marketing of OxyContin during the 1990s.
Purdue’s guilt related to the opioid epidemic is not at issue before the court. Instead, Arizona officials are alleging the family transferred the money from their company in order to prevent paying potential judgements over their alleged role in the crisis, violating a 2007 legal agreement made with the state of Arizona. The state says the family “reaped profits through misleading marketing tactics.” The state’s attorneys want the justices to step in and order that the transfers are void and block any further transfers.
Attorney Travis Lenkner, managing partner at a Chicago law firm representing Arizona in the Supreme Court case, also said there were concerns that Sackler family members were sending some of the money abroad.
We need to do everything we can to stop the opioid manufacturers from profiting from this crisis. They have siphoned off billions of dollars from the company, and I want to make sure that any money will end up with states and victims of the crisis — not in an account in the Cayman Islands or a Swiss bank.
A spokesman for the Sackler family denies the allegations in this claim.
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Most U.S. states have sued Purdue over the toll of the national opioid crisis, and at least 17 of them have now named members of the Sackler family. In 2007, Purdue and top executives pleaded guilty to misleading doctors and patients about OxyContin’s addictive properties. The company paid more than $600 million in fines. Purdue was also ordered to pay a $19.5 million fine to Arizona and 25 other states, and was prohibited from marketing oxycodone painkillers in deceptive ways in the future.
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During this settlement, Purdue also entered into a consent judgment with Arizona to offer further financial support and resolve the state’s investigation into misleading OxyContin marketing. However, Purdue, with the knowledge and approval of the Sacklers, “continued to market its opioids illegally through a marketing campaign that was designed to aggressively increase sales.”
Attorney General Brnovich took Arizona’s case to the nation’s highest court as he believes the Sacklers should be held to highest degree of accountability. Opioids have continued to ravage the state of Arizona with the rate of opioid-related deaths rising 76% since 2013, according to state officials.
It is unconscionable that companies responsible for fueling this crisis might escape paying restitution to victims by transferring billions of dollars made on opioid sales to company owners and then possibly filing for bankruptcy. Those responsible for the opioid crisis must be held accountable, and the Sacklers’ pilfering of Purdue’s assets must be remedied.
A spokesperson for the family said that the Arizona lawsuit was “baseless” and “another misguided attempt to place blame where it does not belong for a complex public health crisis.”
However, if the Supreme Court were to rule in Arizona’s favor, it could open the door to other parties to access those allegedly transferred funds. This means that other states could receive further restitution from Purdue and the Sackler family to fund additional addiction treatment resources and healthcare costs.
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