Purdue Says SCOTUS Lacks Jurisdiction to Rule on Sackler Money Transfers
Opioid maker Purdue Pharma asked the U.S. Supreme Court to toss out the state of Arizona's proposed filing seeking to "claw back" billions of dollars in transfers from its founders, the Sackler family, in light of its Chapter 11 bankruptcy.
October 30, 2019 at 07:45 PM
3 minute read
OxyContin manufacturer Purdue Pharma asked the U.S. Supreme Court to toss out the state of Arizona's proposed filing in an attempt to "claw back" billions of dollars in transfers from its founders, the Sackler family.
Arizona Attorney General Mark Brnovich, in a motion to file a bill of complaint, had asked the Supreme Court to intervene in its opioid lawsuit less than two months before Purdue filed for Chapter 11 bankruptcy protection Sept. 15. His July 31 filing said the Sacklers made "massive cash transfers—totaling billions of dollars—at a time when Purdue faced enormous exposure for its role in fueling the opioids crisis." The state of Arizona, which is seeking to enforce a 2007 consent judgment with Purdue, asked the Supreme Court to step in.
On Wednesday, Purdue said the Supreme Court lacked jurisdiction given its petition in U.S. Bankruptcy Court for the Southern District of New York.
"The bankruptcy court will consider all fraudulent transfer claims in a single proceeding—a proceeding created by Congress to handle precisely this type of situation with consistency and fairness," wrote Purdue attorney Benjamin Kaminetzky of Davis Polk & Wardwell in New York. "As a result, Purdue, as a debtor in possession exercising the powers of a bankruptcy trustee, has exclusive authority to assert all fraudulent transfer claims pertaining to the debtor during the pendency of the bankruptcy. Thus, Arizona may no longer assert this claim, and it is no longer within this court's original jurisdiction."
With him on the brief were Marc Tobak, of counsel, and associate Gerard McCarthy.
Brnovich, a Republican, has brought in a legal team that includes Ashley Keller and Travis Lenkner of Chicago's Keller Lenkner and William Consovoy at Consovoy McCarthy in Washington, D.C., who also represents President Donald Trump in legal battles with Congress over the president's financial records.
The proposed bill of complaint before the Supreme Court implicates more than the state of Arizona. Attorneys general in Alaska, Ohio, Louisiana, North Dakota and Utah, all of whom are Republicans, filed a combined amicus brief Sept. 26 supporting Arizona.
Further, more than two dozen states, including Arizona, and hundreds of cities, counties and other governments, fought in bankruptcy court this month against motions Purdue filed to halt their opioid cases, which are in state courts across the country. Purdue's injunction motions included cases against the Sacklers, who have agreed to contribute $3 billion toward the company's proposed settlement of more than 2,600 lawsuits over the opioid crisis.
On Oct. 11, U.S. Bankruptcy Judge Robert Drain granted Purdue's injunction motions to stay the lawsuits through Nov. 6.
Drain intended that the stay apply to Arizona's filing before the Supreme Court, wrote Purdue attorney Kaminetzky in Wednesday's brief. Further, he wrote, the Supreme Court has long held that it had discretion to accept or reject jurisdiction over matters between a state and citizens of another state.
Arizona, in its proposed bill complaint, acknowledged that precedent but insisted that its case had facts warranting Supreme Court jurisdiction, namely the Uniform Fraudulent Transfer Act, which most states have adopted.
"Only this court can resolve this pressing national issue in a uniform and timely manner," the state's lawyers wrote.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllSettlement With Kleinbard in Diversity Contracting Tiff Allows Pa. Lawyer to Avoid Sanctions
3 minute readState Appellate Court Orders New Trial After Judge Denies Rescheduling, Despite Counsel's Health Emergency
Dapper Labs $4M Settlement, $1.3M in Attorney Fees Reveal NFT Settlement Trend
4 minute readTrending Stories
- 1Infant Formula Judge Sanctions Kirkland's Jim Hurst: 'Overtly Crossed the Lines'
- 2Abbott, Mead Johnson Win Defense Verdict Over Preemie Infant Formula
- 3Guarantees Are Back, Whether Law Firms Want to Talk About Them or Not
- 4Trump Files $10B Suit Against CBS in Amarillo Federal Court
- 5Preparing Your Law Firm for 2025: Smart Ways to Embrace AI & Other Technologies
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250