Sacklers’ Fate at Supreme Court Poised to Reshape Bankruptcy Law

The US Supreme Court’s decision to consider whether Purdue Pharma LP’s $6 billion opioid settlement improperly shields Sackler family members from liability tees up a ruling on one of the most debated corporate bankruptcy questions.

The justices will weigh whether the code permits releases of claims against people and entities that have connections to a bankrupt company but aren’t themselves bankrupt—without claimants’ consent.

The case gives the justices the chance to settle an important question that’s been debated for years in bankruptcy law, reshape how large mass tort cases proceed through Chapter 11, and potentially determine the effectiveness of ...