Purdue Pharma Fight Is Familiar Ground for US Bankruptcy Cop

The Justice Department’s opposition to Purdue Pharma‘s $6 billion opioid settlement underscores the tension of its US Trustee Program’s role, which often causes it to run afoul of other parties in large, corporate bankruptcies.

The US Trustee, the DOJ office tasked with overseeing the bankruptcy system, urged the US Supreme Court to halt Purdue’s bankruptcy settlement because it includes liability releases for members of the Sackler family who own the company. Those releases are not legal under the US Bankruptcy Code because they were included without the explicit consent of potential plaintiffs, the office argues.

The office has opposed ...