Purdue Confronts Supreme Court Skeptical of Bankruptcy Power

The US Supreme Court’s longstanding skepticism towards bankruptcy courts’ authority poses a potentially debilitating obstacle for Purdue Pharma LP in its quest to grant liability releases to its Sackler family owners.

The key question presented in the Purdue case strikes at an issue the Supreme Court has considered multiple times: the extent of a bankruptcy court’s power. If the high court takes a narrow view of bankruptcy court authority, as it did in cases such as Stern v. Marshall and Czyzewski v. Jevic Holding Corp., it could spell major trouble for a settlement years in the making that stands to ...