US Trustee Challenges Constitutionality Of Purdue Releases

By Vince Sullivan (September 22, 2021, 6:56 PM EDT) -- The nondebtor, third-party releases included in Purdue Pharma's Chapter 11 plan are unconstitutional, the U.S. Trustee's Office has argued, asking a New York bankruptcy judge to wait until a higher court rules on the federal watchdog's challenge to the releases.

In filings made late Tuesday, U.S. Trustee William K. Harrington said he has serious concerns about the nondebtor, third-party releases granted in the case that absolve the members of the Sackler family that own Purdue of liability related to the opioid crisis.

While claimants would be irreparably harmed by the plan releases going into effect, Purdue would not incur such harm,...

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