Purdue Pharma law firms relinquishing $1M in fees to settle concerns about disclosures
The Department of Justice (DOJ) has ordered three law firms for Purdue Pharma to relinquish $1 million in fees earned in the drugmakers’ opioid epidemic-related bankruptcy cases due to concerns about the firms’ disclosures to the court.
The DOJ’s U.S. Trustee Program (USTP) announced on Thursday the settlement with the three law firms: Skadden, Arps, Slate, Meagher & Flom LLP; Wilmer Cutler Pickering Hale and Dorr LLP; and Dechert LLP.
The USTP alleges that the three firms did not “adequately disclose” a joint defense and common interest agreement between Purdue Pharma and members of the Sackler family who own the company. That agreement “created obligations” for the firms pertaining to the defense against hundreds of lawsuits related to its drug OxyContin.
Why this matters: USTP Director Cliff White described the disclosure “violations” as “particularly concerning because a central question in these cases has been the independence of Purdue from the Sackler families.”
What the law firms say: The firms’ position in the settlement said, “Although the Firms do not believe that the Common Interest Agreement is a ‘connection’ that was required to be disclosed … they have agreed to resolve the matter in the interest of expediency.”
What’s next: The agreement still requires approval from the Bankruptcy Court for the Southern District of New York.