Sacklers "Siphoned" Money From Purdue To Avoid Payouts, Lawsuit Alleges

By Kelly Burch 08/09/19

A spokesperson for the Sackler family said that they were within their rights as shareholders to withdraw profits from Purdue Pharma.

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Lawyers drafting lawsuit aimed at Sackler, Purdue

The state of Arizona has gone directly to the U.S. Supreme Court with a bold lawsuit alleging that members of the Sackler family took $4 billion from Purdue Pharma between 2008 and 2019 when they knew that the company would likely need the funds to settle opioid-related lawsuits. 

“These transfers all took place at times when company officials, including the Sacklers, were keenly aware that Purdue was facing massive financial liabilities and that these transfers could prevent it from satisfying eventual judgments,” the suit argues

“We want the Supreme Court to make sure that we hold accountable those individuals who are responsible for this epidemic,” Arizona’s Attorney General Mark Brnovich told The New York Times. “We allege that the Sacklers have siphoned billions of dollars from Purdue in recent years. They did this while knowing the company was facing massive financial liabilities.”

The Long Shot

The state hopes that the U.S. Supreme Court will hear the case because it involves a state as a party. However, that may be unlikely since the court rarely hears cases that have not first gone through lower courts. 

“I do think it’s a long shot,” Brnovich said. “It’s a little different. It’s a little unorthodox. Sometimes you’ve just got to throw deep.”

He said that the pressing need for funds to combat the opioid crisis calls for intervention at the highest level of the court system. “We don’t have time for this to take years to wind through the courts. The Supreme Court has jurisdiction, and we think they have to act.”

Another lawyer for the state, William S. Consovoy, said that the state is looking for a quicker resolution to the case. “The urgency is a big deal here. It’s very important that we get this resolved expeditiously, and that’s one of the key reasons why the Supreme Court is the right place to do this and to do this now.”

Sacklers' Statement

A spokesperson for the Sackler family said that they were within their rights as shareholders to withdraw profits from Purdue Pharma. The spokesperson added that the allegations in the lawsuit are “inconsistent with the factual record.” The Sacklers “will vigorously defend against them,” the spokesperson said.  

The Sackler family, in addition to Purdue Pharma, have become regular targets for opioid-related lawsuits, in part for their alleged misleading marketing of the drug OxyContin. 

It is not clear when the court will decide whether or not to hear Arizona’s lawsuit. 

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Kelly Burch writes about addiction and mental health issues, particularly as they affect families. Follow her on TwitterFacebook, and LinkedIn.

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