Supreme Court to Hear Purdue Pharma Bankruptcy Challenge in Pivotal December Session

Pieter Gunst04 mins

On December 4, the Supreme Court will hear the challenge to Purdue Pharma’s bankruptcy plan. Purdue Pharma is the manufacturer of OxyContin, a highly addictive painkiller. The argument around Purdue Pharma’s case will be one of the eight cases scheduled in December for seven hours of oral argument, as revealed by the court’s December argument calendar.

Purdue Pharma’s bankruptcy plan had been put on hold by a brief order in August, filed at the request of the U.S. Trustee, a division of the U.S. Department of Justice overseeing bankruptcy cases. The presiding judge over the bankruptcy case confirmed the plan in 2021, calling it a bitter result as it shields the Sackler family – owners of Purdue Pharma – from lawsuits. The judge further iterated that the settlement was the only means to provide funding for communities to mitigate the problems caused by opioids.

A day after the Purdue Pharma hearing, on December 5, the constitutionality of a federal law mandating U.S taxpayers who own shares in foreign corporations to pay a one-time tax on their share of the corporation’s earnings is set to be heard by the Supreme Court. The tax comes into effect even if the earnings are reinvested in the corporation. A couple from Washington state, argues that this mandatory repatriation tax violates the 16th Amendment, which empowers Congress to impose income tax. They contend that the amendment requires income to be distributed before it can be taxed; hence, the mandatory repatriation tax qualifies as a direct tax and ought to be apportioned among the states as specified in the Constitution. More details about this case can be found here.

The much-anticipated case, Loper Bright Enterprises v. Raimondo, won’t be slated for December’s argument session. This involves revisiting the historic ruling in Chevron v. Natural Resources Defense Council where courts were advised to defer to a federal agency’s interpretation of a law, provided it was reasonable. Detailed context can be read in John Elwood’s Relist Watch column.

Here are further legal battles for December 2023:

Each case here largely carries substantial implications for corporate law, constitutional interpretation, and federal jurisdiction. They are worth noting for all legal professionals and corporations.