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Discharging Equity: Harrington V. Purdue Pharma L.P. And The Validity Of Nonconsensual Third-Party Releases, Andrew Klauber Apr 2024

Discharging Equity: Harrington V. Purdue Pharma L.P. And The Validity Of Nonconsensual Third-Party Releases, Andrew Klauber

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In September 2019, Purdue Pharma L.P. petitioned for bankruptcy in the Southern District of New York. Purdue, which the Sackler family had owned and operated for decades, developed and aggressively marketed addictive opioid products, contributing to the modern opioid epidemic. The tsunami of litigation arising from the opioid epidemic gave rise to claims against Purdue and the Sackler family estimated to total more than $40 trillion, causing Purdue to petition for Chapter 11 bankruptcy.

In Purdue’s plan of reorganization, it employed a nonconsensual third-party release to discharge claims against the Sackler family. Nonconsensual third-party releases controversially enjoin parties to a …