Purdue Pharma’s long-awaited criminal sentencing moved back a week after a federal judge decided opioid victims should be able to attend the proceeding in person. U.S. District Judge Madeline Cox Arleo postponed the hearing after she saw opioid-crisis victims protesting outside her courthouse in Newark, New Jersey, as she had originally planned for Tuesday’s sentencing to be held by videoconference, according to the Associated Press.
Arleo is expected to carry out the sentencing next Tuesday. The forfeiture at the center of the proceeding is expected to be $225 million to the Justice Department, a key step described as helping Purdue finalize a settlement aimed at resolving nearly all of the thousands of lawsuits the company faces over its role in the opioid crisis.
The forfeiture penalty is part of a plea agreement reached in 2020 to resolve federal civil and criminal probes. If the judge signs off on the sentencing as expected, the structure of the agreement calls for Purdue to avoid additional collections of other criminal forfeitures and fines as well as civil liabilities, with portions of that broader money treated as part of the settlement funding.
Purdue pleaded guilty in November 2020 to three federal criminal charges. Prosecutors said the company admitted it lacked an effective program to prevent its powerful prescription painkillers from being diverted to the black market, even though it had told the U.S. Drug Enforcement Administration that it did. The company also admitted that it paid doctors through a speakers program to prescribe opioids and paid an electronic medical records company to send doctors information about patients that, prosecutors said, encouraged more opioid prescriptions.
The settlement tied to the guilty plea had already been approved by another judge last year, and Purdue said the agreement could still be effective May 1 if the sentence was given on the scheduled date. Under the broader settlement framework, members of the Sackler family who own the company are described as contributing up to $7 billion over 15 years, with most of the money going to government entities to address the overdose epidemic, and the deal also includes payments for some individual victims or their survivors.
As part of the resolution, the settlement would shield Sackler family members from lawsuits by those who agree to accept the payments. The company itself is described as planned to cease to exist and be replaced by a new company, Knoa Pharma, intended to operate for the public benefit with a board appointed by the states. The reorganization has been described as highly complex, and the Associated Press reported that by the end of last year Purdue had paid more than $1 billion to law firms and other professionals across the case, according to a court filing.
Although Sackler family members have long been portrayed in opioid-crisis litigation as central villains, the Associated Press reported that no family members were charged. The company and family were described as making payments totaling $10.7 billion from Purdue between 2008 and 2018, with nearly half used to pay taxes on Purdue’s behalf, and the report said that they had not been paid by the company since 2018 and that the last family members left the company’s board in 2019.
Not all victims and families accepted the settlement quietly. The Associated Press reported that more than 54,000 people with personal injury claims against Purdue voted to accept the settlement, while 218 voted against it, and some victims and relatives have argued for years that the settlement and guilty plea fall short of justice. The sentencing next Tuesday is expected to give them another chance to press their case.
Outside the courthouse on Tuesday, the report said Stacy Schwab described being dependent on OxyContin about 20 years ago, saying opioids killed one family member and that another relative is struggling with addiction. The Associated Press reported that she said she feels furious at Sackler family members and described how she said her family lacked money for private treatment while the family has billions of dollars, and she also said she believes the judge is giving victims a chance to be heard. Separately on Tuesday, the Associated Press reported that a lawyer filed a request seeking to have the government’s expected $225 million forfeiture used for victims’ medical care.