No. ________, Original

STATE OF ARIZONA,
Plaintiff,
v.

RICHARD SACKLER, THERESA SACKLER, KATHE SACKLER,
JONATHAN SACKLER, MORTIMER D.A. SACKLER, BEVERLY
SACKLER, DAVID SACKLER, ILENE SACKLER LEFCOURT, PURDUE
PHARMA, INC., PURDUE PHARMA, L.P., THE PURDUE FREDERICK
COMPANY, INC., PURDUE HOLDINGS L.P., PLP ASSOCIATES
HOLDINGS L.P., BR HOLDINGS ASSOCIATES L.P., ROSEBAY
MEDICAL COMPANY L.P., AND BEACON COMPANY,
Defendants.
MOTION FOR LEAVE TO FILE BILL OF COMPLAINT
Mark Brnovich
Attorney General
Rebecca Eggleston
OFFICE OF THE ARIZONA
ATTORNEY GENERAL
2005 N. Central Ave.
Phoenix, AZ 85004
(602) 542-5025

William S. Consovoy
Counsel of Record
CONSOVOY MCCARTHY PLLC
1600 Wilson Boulevard,
Suite 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
Ashley Keller
Travis Lenkner
KELLER LENKNER LLC
150 North Riverside Plaza
Suite 4270
Chicago, IL 60606
(312) 741-5220

July 31, 2019

Attorneys for Plaintiff, State of
Arizona

 Plaintiff, the State of Arizona,1 respectfully
moves this Court for leave to file the attached Bill of
Complaint. The grounds for this Motion are set forth
in an accompanying brief.

Respectfully submitted,
Mark Brnovich
Attorney General
Rebecca Eggleston
OFFICE OF THE
ARIZONA ATTORNEY
GENERAL
2005 N. Central Ave.
Phoenix, AZ 85004
(602) 542-5025

July 31, 2019

William S. Consovoy
Counsel of Record
CONSOVOY MCCARTHY PLLC
1600 Wilson Boulevard,
Suite 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
Ashley Keller
Travis Lenkner
KELLER LENKNER LLC
150 North Riverside Plaza,
Suite 4270
Chicago, IL 60606
(312) 741-5220
Attorneys for Plaintiff, State
of Arizona

1 Arizona Attorney General Mark Brnovich brings this
action on behalf of the State of Arizona pursuant to A.R.S.
§ 41-193(A)(3).

 No. ________, Original

STATE OF ARIZONA,
Plaintiff,
v.

RICHARD SACKLER, THERESA SACKLER, KATHE SACKLER,
JONATHAN SACKLER, MORTIMER D.A. SACKLER, BEVERLY
SACKLER, DAVID SACKLER, ILENE SACKLER LEFCOURT, PURDUE
PHARMA, INC., PURDUE PHARMA, L.P., THE PURDUE FREDERICK
COMPANY, INC., PURDUE HOLDINGS L.P., PLP ASSOCIATES
HOLDINGS L.P., BR HOLDINGS ASSOCIATES L.P., ROSEBAY
MEDICAL COMPANY L.P., AND BEACON COMPANY,
Defendants.
BILL OF COMPLAINT
Mark Brnovich
Attorney General
Rebecca Eggleston
OFFICE OF THE ARIZONA
ATTORNEY GENERAL
2005 N. Central Ave.
Phoenix, AZ 85004
(602) 542-5025

William S. Consovoy
Counsel of Record
CONSOVOY MCCARTHY PLLC
1600 Wilson Boulevard,
Suite 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
Ashley Keller
Travis Lenkner
KELLER LENKNER LLC
150 North Riverside Plaza
Suite 4270
Chicago, IL 60606
(312) 741-5220

July 31, 2019

Attorneys for Plaintiff, State of
Arizona

 BILL OF COMPLAINT
Plaintiff, the State of Arizona,1 brings this
action against Defendants Richard Sackler, Theresa
Sackler, Kathe Sackler, Jonathan Sackler, Mortimer
D.A. Sackler, Beverly Sackler, David Sackler, Ilene
Sackler Lefcourt, Purdue Pharma, Inc., Purdue
Pharma, L.P., The Purdue Frederick Company, Inc.,
Purdue Holdings L.P., PLP Associates L.P., Rosebay
Medical Company L.P., and Beacon Company
(collectively, “Defendants”), and for its causes of
action asserts as follows:
NATURE OF THE ACTION
1.
Defendants Richard Sackler, Theresa
Sackler, Kathe Sackler, Jonathan Sackler, Mortimer
D.A. Sackler, Beverly Sackler, David Sackler, and
Ilene Sackler Lefcourt (“the Sacklers”) for decades
owned and controlled The Purdue Frederick
Company, Inc., Purdue Pharma Inc. and Purdue
Pharma, L.P. (collectively, “Purdue”). The Sacklers
and Purdue have made billions of dollars off the
promotion and sale of opioids, fueling a crisis with
devastating effects in Arizona and the nation. The
Sacklers and Purdue reaped profits through
misleading marketing tactics that were barred by a
2007 consent judgment that Purdue entered into
with the State of Arizona. The State is seeking civil
Arizona Attorney General Mark Brnovich brings this
action on behalf of the State of Arizona pursuant to A.R.S.
§ 41-193(A)(3).
1

 2
penalties and other relief for violation of that consent
judgment in a pending case before Pima County
Superior Court. See Arizona ex rel. Brnovich v.
Purdue Pharma, L.P., et al., No. C20072471 (Ariz.
Super. Ct.).
2.
The State brings this action because it
has evidence that the Sacklers, Purdue, and the
other Defendants were parties in recent years to
massive cash transfers—totaling billions of dollars—
at a time when Purdue faced enormous exposure for
its role in fueling the opioids crisis. These transfers
threaten the ability of Purdue to satisfy any relief
the State may obtain in its pending proceeding
against Purdue. The State therefore brings this
action to hold the Defendants accountable for their
attempts to loot Purdue, and to ensure that the
people of Arizona can obtain adequate relief for the
devastation that the Sacklers and Purdue have
wrought in this state.
JURISDICTION
3.
This Court has original jurisdiction over
this action under Article III, § 2, cl. 2 of the U.S.
Constitution because the dispute is a “Case[] … in
which a State shall be Party” and under 28 U.S.C. §
1251(b)(3) because it is an “action[] or proceeding[]
by a State against the citizens of another State.”
PARTIES
4.

Plaintiff is the State of Arizona.

 3
5.
Defendant The Purdue Frederick
Company, Inc., is a drug company that
manufactured, sold, and distributed pharmaceutical
products, including opioids.
6.
Defendant Purdue Pharma Inc. is a
drug company that manufactures, sells, and
distributes pharmaceutical products, including
opioids. It is the general partner of Defendant
Purdue Pharma L.P.
7.
Defendant Purdue Pharma L.P. is a
limited partnership that includes the commercial
group responsible for promoting and selling opioids.
It is controlled by Defendant Purdue Pharma Inc.
8.
Defendants Richard Sackler, Theresa
Sackler, Kathe Sackler, Jonathan Sackler, Mortimer
D.A. Sackler, Beverly Sackler, David Sackler, and
Ilene Sackler Lefcourt were members of the Board of
Directors of Purdue Pharma Inc. since the 1990s.
Together, they always held the controlling majority
of the Board, giving them full control over Purdue
Pharma Inc. and Purdue Pharma L.P. From that
position, they directed the deceptive sales and
marketing of OxyContin. And they paid themselves
billions of dollars through transfers to numerous
entities that either were controlled by the Sacklers or
were created for their benefit.
9.
Defendant Richard Sackler is the
former President and CEO of Purdue Pharma Inc.
He also was a Board member of Purdue Pharma Inc.
until 2018.

 4
10.
Defendant Theresa Sackler served as a
Board member of Purdue Pharma Inc. until 2018.
11.
Defendant Kathe Sackler previously
served as Vice President and was a Board member of
Purdue Pharma Inc. until 2018.
12.
Defendant Jonathan Sackler previously
served as Vice President and was a Board member of
Purdue Pharma Inc. until 2018.
13.
Defendant Mortimer D.A. Sackler
previously served as Vice President and was a Board
member of Purdue Pharma Inc. until 2019.
14.
Defendant Beverly Sackler served as a
Board member of Purdue Pharma Inc. until 2017.
15.
Defendant David Sackler served as a
Board member of Purdue Pharma Inc. until 2018.
16.
Defendant Ilene Sackler Lefcourt served
as a Board member of Purdue Pharma Inc. until
2018.
17.
Defendant Purdue Holdings, L.P. is a
Delaware limited partnership. Purdue Holdings L.P.’s
partners are Purdue Pharma Inc., PLP Associates
Holdings Inc., and PLP Associates Holdings L.P.
18.
Defendant PLP Associates Holdings
L.P. is a Delaware limited partnership and a limited
partner of Purdue Holdings L.P. Its partners are PLP
Associates Holdings Inc. and BR Holdings Associates
L.P.

 5
19.
Defendant BR Holdings Associates L.P.
is a Delaware limited partnership.
20.
Defendant Rosebay Medical Company
L.P. is a Delaware limited partnership ultimately
owned by trusts for the benefit of one or more of the
Sacklers. Its general partner is Rosebay Medical
Company, Inc. The Board of Directors of Rosebay
Medical Company, Inc. includes board members
Richard S. Sackler and Jonathan D. Sackler.
21.
Defendant Beacon Company is a
Delaware general partnership ultimately owned by
trusts for the benefit of one or more of the Sacklers.
FACTUAL ALLEGATIONS
A.

The Nationwide Opioid Crisis

22.
The opioid crisis is the worst man-made
disaster in American history. There have been
almost 400,000 opioid-related deaths in the United
States in the last two decades. See Understanding
the Epidemic, U.S. Dep’t of Health & Human
Services, Centers for Disease Control & Prevention,
Dec. 19, 2018, https://bit.ly/2jEOHfs.
23.
And it is only getting worse. In 2017,
the number of overdose deaths involving opioids was
six times higher than in 1999. Id. Staggeringly, more
than 130 people in the United States die every day
from an opioid overdose. See Opioid Overdose Crisis,
National Institute on Drug Abuse, Jan. 2019,
https://bit.ly/2j6YEE1. These deaths “are up among

 6
both men and women, all races, and adults of nearly
all ages.” Understanding the Epidemic, supra.
24.
This
epidemic
is
devastating
communities across the United States. It has
increased crime, homelessness, and healthcare costs;
it has torn apart families; and it has damaged the
economy. Id. In all, prescription opioid misuse costs
the U.S. economy at least $78.5 billion annually.
Opioid Overdose Crisis, supra. The President has
rightly declared the opioid crisis to be a public health
emergency. Ending America’s Opioid Crisis, The
White House, https://www.whitehouse.gov/opioids/.
25.
Like its sister States, Arizona has
suffered these harms. Since 2013, opioid-related
deaths in Arizona have risen 76 percent, with 928
deaths reported just in 2017 alone. See Arizona
Opioid Summary, National Institute on Drug Abuse,
Rev., Mar. 2019, https://bit.ly/31Fm0p0. That same
year, Arizona providers wrote an astonishing 61.2
opioid prescriptions for every 100 Arizonans. See id.
26.
The Arizona Department of Health
Services estimates that between June 2017 and June
2019, more than 3,000 Arizonans died from an opioid
overdose. See Opioid Epidemic, Arizona Dep’t of
Health Services, 2019, https://bit.ly/2kaC9Ou. In
2017, Governor Ducey declared the crisis to be a
statewide emergency. See id.

 7
B.

Purdue’s Role in Causing the Opioid
Epidemic

27.
Opioids have existed for centuries, but
they were not always the scourge they have become.
Before the 1990s, doctors rarely prescribed them.
The medical community understood that, although
opioids could effectively mask pain, they carried
serious risks, including addiction, withdrawal, and
overdose. As a result, they were typically prescribed
only for acute pain, surgery recovery, cancer
treatment, or end-of-life palliative care. Opioids were
not prescribed for chronic or commonplace pain.
28.
But this was not good enough for
Defendants Purdue Pharma L.P., Purdue Pharma
Inc., and Purdue Frederick Company, Inc.
(collectively, “Purdue”). Over the last two decades,
Purdue embarked on an aggressive marketing
campaign to disrupt prevailing medical norms in
order to pump up sales of its opioid painkillers,
including OxyContin.
29.
In
particular,
Purdue
illegally
minimized the risks associated with prescription
opioids and aggressively encouraged doctors to
prescribe them more broadly. Indeed, shortly after
Purdue began selling OxyContin, its President,
Defendant Richard Sackler, crassly boasted that “the
launch of OxyContin tablets will be followed by a
blizzard of prescriptions that will bury the
competition. The prescription blizzard will be so
deep, dense, and white.”

 8
30.
He was right. Doctors were deceived
into prescribing more of Purdue’s opioids, in higher
doses, and for longer periods of time. Purdue’s profits
soared. By 2000, in fact, the company was realizing
more than a billion dollars each year in sales of
OxyContin alone. See Mike Mariani, How the
American Opiate Epidemic Was Started by One
Pharmaceutical Company, The Week, Mar. 4, 2015,
https://bit.ly/2nlwLfu.
31.
And as Purdue’s profits rose, so too did
opioid addiction, overdoses, and deaths. In just seven
years (1999 to 2006), prescription opioid deaths in
the United States rose by nearly 400%. See
Understanding the Epidemic, supra.
32.
Federal and state officials took notice.
In 2006, the Justice Department began investigating
Purdue over its marketing of OxyContin. It
discovered that Purdue knew about “significant”
abuse of OxyContin as far back as 1996, yet actively
concealed that information from the public. Company
officials had received reports that the pills were
being crushed and snorted, stolen from pharmacies,
and that some doctors were being charged with
illegally selling prescriptions.
33.
Yet Purdue continued to market
OxyContin as less prone to abuse and addiction than
other opioids. DOJ also discovered that the Sacklers
had received reports detailing the ways in which
Purdue’s opioids were being abused. See Barry
Meier, Origins of an Epidemic: Purdue Pharma

 9
Knew Its Opioids Were Widely Abused, N.Y. Times,
May 29, 2018, https://nyti.ms/2sfaW1G.
34.
In 2007, Purdue and top executives
pleaded guilty to misleading doctors and patients
about the addictive properties of OxyContin and
misbranding the product as “abuse resistant.” United
States v. Purdue Frederick Co., Inc., No. 1:07-cr-29
(W.D. Va. May 10, 2007). Federal prosecutors had
uncovered a “corporate culture that allowed this
product to be misbranded with the intent to defraud
and mislead.” Id.
35.
Purdue paid more than $600 million in
fines, among the largest settlements in U.S. history
for a pharmaceutical company. Id. It also signed a
corporate integrity agreement with the federal
government, promising that the company would not
violate the law in the future. Id.
36.
During this time, Purdue also entered
into a consent judgment with the State of Arizona
(“Consent Judgment”) to resolve the State’s
investigation into the company’s misleading
marketing of OxyContin. See Arizona, ex rel.
Goddard v. Purdue Pharma Inc., et al., No.
C20072471 (Ariz. Super. Ct. May 14, 2007).
37.
The Consent Judgment prohibited
Purdue from, among other things, promoting and
marketing its oxycodone painkillers in deceptive
ways, and it required Purdue to pay a $19.5 million
fine, which was distributed to Arizona and 25 other

 10
States that had entered into similar consent
judgments with the company. Id.
C.

Purdue’s Continued Misconduct

38.
Despite all of the fines, settlements,
judgments, and promises, Purdue—with the
knowledge and approval of the Sacklers—continued
to market its opioids illegally through a marketing
campaign that was designed to aggressively increase
sales.
39.
Purdue targeted doctors it knew would
be susceptible to its deceptive marketing—e.g., highvolume opioid prescribers, inexperienced providers,
and primary-care physicians who knew little about
pain management—and encouraged them to
prescribe higher and higher doses for longer periods
of time.
40.
Purdue then blamed opioid abuse on
patients, instead of the addictive nature of the drugs.
It pushed opioid prescriptions to elderly patients who
had never taken them before, without disclosing the
higher risks to this vulnerable population. It claimed
that opioids were safer than acetaminophen (e.g.,
Tylenol) and non-steroidal anti-inflammatory drugs
(e.g., ibuprofen) and that the risk of addiction was
insignificant. And it falsely assured doctors and
patients that its reformulated OxyContin was safe.
41.
This brazen campaign caused opioid
prescriptions (and Purdue’s profits) to skyrocket. By
2009, Purdue was making more than two billion

 11
dollars each year from sales of OxyContin alone; as of
2016, Purdue had earned more than $31 billion from
OxyContin.
42.
That same year, more than 214 million
opioid prescriptions were written in the United
States—enough for two out of every three Americans
to have a prescription. See U.S. Opioid Prescribing
Rate Maps, U.S Dep’t of Health & Human Services,
Centers for Disease Control & Prevention, Oct 3,
2018, https://bit.ly/2vzRjoj.
43.
It is unsurprising, then, that Forbes
identified the Sacklers as the 19th richest family in
the United States, with a fortune that had soared to
$13 billion. See The Sackler Family, Forbes
Magazine, 2016, https://bit.ly/2MUQY9b.
44.
Purdue’s
misconduct
again
drew
scrutiny. Purdue is presently facing thousands of
lawsuits in which plaintiffs, including counties,
cities, towns, and nearly every State in the country,
are seeking to recover billions of dollars under
consumer-protection and tort law. These actions are
slowly winding their way through the courts.
Recently, Purdue agreed to pay $270 million to settle
Oklahoma’s lawsuit. See Sara Randazzo, Purdue
Pharma Begins Resolution of Opioid Cases With $270
Million Deal, Wall Street Journal, Mar. 26, 2019,
https://on.wsj.com/ 2FCqunj.
45.
Like other States, Arizona is taking
action to redress the harm Purdue has inflicted. On
September 11, 2018, an Arizona state court ordered

 12
Purdue to show cause as to whether it should be
found in violation of the Consent Judgment. See
Arizona, ex rel. Brnovich v. Purdue Pharma L.P., et
al., No. C20072471 (Ariz. Super. Ct. Sept. 11, 2018).
The State is seeking civil penalties of up to $25,000
per violation. That case is set for trial in 2021.
D.

The Sacklers’ Looting of Purdue

46.
Purdue is not a public company. It has
long been owned and operated by eight individuals
from a single family: Defendants Richard Sackler,
Beverly Sackler, David Sackler, Ilene Sackler
Lefcourt, Jonathan Sackler, Kathe Sackler, Mortimer
Sackler, and Theresa Sackler. As members of
Purdue’s Board of Directors, the Sacklers controlled,
directed, and oversaw all of the company’s actions.
47.
The Sacklers have long been aware that
Purdue’s marketing of opioids posed a massive
liability risk to the company. In fact, through their
control of the Board and Richard Sackler’s role as
President, the Sacklers ordered or oversaw much of
Purdue’s illegal marketing, in addition to related
strategic decisions.
48.
For example, in 2014, Kathe Sackler, a
board member, pitched “Project Tango,” a secret plan
to grow Purdue beyond providing painkillers by also
providing a drug, Suboxone, to treat those addicted.
According to Ms. Sackler, the plan could be profitable
because “[a]ddictive opioids and opioid addiction are
‘naturally linked.’”

 13
49.
After Purdue’s settlements and guilty
pleas, Richard Sackler wrote a memo exploring
options that could protect the family from the
“dangerous concentration of risk” they faced. As
lawsuits and regulatory scrutiny continued to mount,
the Sacklers recognized the dangers Purdue was
facing.
50.
In 2015, Purdue’s chief financial officer,
Edward Mahoney, acknowledged that the company
faced claims of more than a billion dollars and that
the claims, if successful, “would have a crippling
effect on Purdue’s operations and jeopardize
Purdue’s long-term viability.” The potential liability
grew exponentially in the following years.
51.
Despite
these
massive
potential
liabilities, the Sacklers regularly depleted Purdue of
its assets. Between 2008 and 2016, Purdue
transferred more than $4 billion to the Sacklers, as
the following chart shows:

 14

52.
The Sacklers also directed Purdue to
transfer billions of dollars to companies the Sacklers
controlled, including Defendants PLP Associates
Holdings L.P., Rosebay Medical Company L.P., and
Beacon Company. Since 2008, the Sacklers voted to
distribute nearly $2 billion to PLP Associates
Holdings L.P. In 2016 alone, the Sacklers distributed
more than $175 million to themselves.
53.
Much of this money has flowed
overseas, including to Defendant Rosebay Medical
Company L.P. See Bruce Einhorn, et al., OxyContin
Billionaires Chase Global Profits to Offset U.S. Woes,
Bloomberg, Mar. 30, 2019, https://bloom.bg/2Gj4Pkb.
54.
These transfers all took place at times
when company officials, including the Sacklers, were
keenly aware that Purdue was facing massive

 15
financial liabilities and that these transfers could
prevent it from satisfying eventual judgments.
55.
Not surprisingly, Purdue recently
announced that it is contemplating bankruptcy. In
March 2019, Purdue CEO Craig Landau told the
Washington Post that bankruptcy “is an option. We
are considering it, but we’ve really made no decisions
on what course to pursue. A lot depends on what
unfolds in the weeks and months ahead.”
E.

Avoiding the Sacklers’ Fraudulent
Transfers

56.
After the Sacklers’ misconduct came to
light, States began suing them to avoid the
fraudulent transfers. See, e.g., Connecticut v. Purdue
Pharma L.P., et al., No. X07 HHD-CV-19-6105325-S
(Conn. Super. Ct. Apr. 22, 2019).
57.
More suits are likely to follow. Every
State in the country has a fraudulent-conveyance
statute and nearly every State faces the prospect of
being unable to recover against Purdue due to these
improper transfers.
58.
These cases have raised (and will
continue to raise) similar if not identical issues and
claims. Virtually all States have adopted the
Uniform Fraudulent Transfer Act. See Fraudulent
Transfer
Act,
Uniform
Law
Comm’n,
https://bit.ly/2YpMg3Y (showing that 43 States and
the District of Columbia have adopted UFTA);
Thompson v. Hanson, 174 P.3d 120, 126 (Wash. Ct.

 16
App. 2007) (noting that “an explicit purpose of the
UFTA is uniformity among the States”).
59.
Under the UFTA, any transfer of funds
that is made with intent to hinder, delay, or defraud
present or future creditors may be avoided. These
transfers also can be avoided if there was
constructive fraud, e.g., a transfer of funds without
receiving equivalent value in return.
CAUSES OF ACTION
COUNT I:
INTENTIONAL FRAUDULENT CONVEYANCE
60.
Paragraphs 1–59 are incorporated by
reference as if fully restated here.
61.
The State’s litigation against Purdue
constitutes a claim against Purdue rendering the
State a creditor of Purdue within the meaning of
Ariz. Rev. Stat. §§ 44-1001 and 44-1004.
62.
The State’s claim arose no later than
2008 and continued through at least September
2018, when Purdue repeatedly violated the terms of
the 2007 Consent Judgment.
63.
All of the transfers of assets from
Purdue to the Sacklers described above constituted
transfers pursuant to §§ 44-1001 and 44-1004, and
were made with actual intent to hinder, delay, or
defraud present and/or future creditors of Purdue,
including the State of Arizona.

 17
64.
Accordingly, the State is entitled to the
relief provided by Ariz. Rev. Stat. § 44-1007.
COUNT II:
CONSTRUCTIVE FRAUDULENT
CONVEYANCE
65.
Paragraphs 1–64 are incorporated by
reference as if fully restated here.
66.
The State’s litigation against Purdue
constitutes a claim against Purdue rendering the
State a creditor of Purdue within the meaning of
Ariz. Rev. Stat. §§ 44-1001 and 44-1004.
67.
The State’s claim arose no later than
2008 and continued through at least September
2018, when Purdue repeatedly violated the terms of
the 2007 Consent Judgment.
68.
All of the transfers of assets from
Purdue to the Sacklers described above constituted
transfers pursuant to §§ 44-1001 and 44-1004, and
were made without receiving a reasonably equivalent
value in exchange for the transfer.
69.
All the transfers of assets from Purdue
to the Sacklers described above were made when
Purdue was engaged in or about to engage in a
business or transaction for which the remaining
assets of Purdue were unreasonably small in relation
to the business or transaction, or, in the alternative,
intended to incur, or believed or reasonably should

 18
have believed that Purdue would incur, debts beyond
its ability to pay as they became due.
70.
In addition and/or in the alternative,
those transfers were made at a time when Purdue
was insolvent or became insolvent as a result of the
transfer or obligation.
71.
Accordingly, the State is entitled to the
relief provided by Ariz. Rev. Stat. § 44-1007.
PRAYER FOR RELIEF
The State requests that the Court order the
following relief:
a) Declaratory relief that the transfers alleged
in this Bill of Complaint are void;
b) Garnishment against those Defendants
who received the transfers alleged in this
Bill of Complaint in accordance with the
procedure prescribed by law in obtaining
such remedy;
c) Attachment against the assets transferred
or other property of the Defendants in
accordance with the procedure prescribed
by law in obtaining such remedy;
d) An injunction against further disposition
by the Defendants of the assets transferred
or of other property; and
e) Any other relief available at law or equity.

 19

Respectfully submitted,
Mark Brnovich
Attorney General
Rebecca Eggleston
OFFICE OF THE
ARIZONA ATTORNEY
GENERAL
2005 N. Central Ave.
Phoenix, AZ 85004
(602) 542-5025

July 31, 2019

William S. Consovoy
Counsel of Record
CONSOVOY MCCARTHY PLLC
1600 Wilson Boulevard,
Suite 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
Ashley Keller
Travis Lenkner
KELLER LENKNER LLC
150 North Riverside Plaza,
Suite 4270
Chicago, IL 60606
(312) 741-5220
Attorneys for Plaintiff, State
of Arizona

 No. ________, Original

STATE OF ARIZONA,
Plaintiff,
v.

RICHARD SACKLER, THERESA SACKLER, KATHE SACKLER,
JONATHAN SACKLER, MORTIMER D.A. SACKLER, BEVERLY
SACKLER, DAVID SACKLER, ILENE SACKLER LEFCOURT, PURDUE
PHARMA, INC., PURDUE PHARMA, L.P., THE PURDUE FREDERICK
COMPANY, INC., PURDUE HOLDINGS L.P., PLP ASSOCIATES
HOLDINGS L.P., BR HOLDINGS ASSOCIATES L.P., ROSEBAY
MEDICAL COMPANY L.P., AND BEACON COMPANY,
Defendants.
BRIEF IN SUPPORT OF MOTION FOR LEAVE TO FILE
BILL OF COMPLAINT
Mark Brnovich
Attorney General
Rebecca Eggleston
OFFICE OF THE ARIZONA
ATTORNEY GENERAL
2005 N. Central Ave.
Phoenix, AZ 85004
(602) 542-5025

William S. Consovoy
Counsel of Record
CONSOVOY MCCARTHY PLLC
1600 Wilson Boulevard,
Suite 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
Ashley Keller
Travis Lenkner
KELLER LENKNER LLC
150 North Riverside Plaza
Suite 4270
Chicago, IL 60606
(312) 741-5220

July 31, 2019

Attorneys for Plaintiff, State of
Arizona

 i
TABLE OF CONTENTS
TABLE OF AUTHORITIES....................................... ii
INTRODUCTION ........................................................1
STATEMENT OF THE CASE ....................................4
A. The Nationwide Opioid Crisis ..........................4
B. Purdue’s Role in Causing the Opioid
Epidemic ...........................................................5
C. Purdue’s Continued Misconduct ......................7
D. The Sacklers’ Looting of Purdue ......................9
E. Avoiding the Sacklers’ Fraudulent
Transfers ......................................................... 11
ARGUMENT ............................................................. 12
I. The Constitution Requires the Court to
Grant Leave to File the Bill of Complaint. .... 13
II. The Bill of Complaint Raises an Issue of
National Importance that Warrants
Granting Leave to File. .................................. 16
CONCLUSION .......................................................... 21

 ii
TABLE OF CITED AUTHORITIES
Cases:
Ames v. Kansas,
111 U.S. 449 (1884) ........................................ 17, 19
Arizona, ex rel. Brnovich v. Purdue Pharma
L.P., et al.,
No. C20072471 (Ariz. Super. Ct.
Sept. 11, 2018) ...................................................... 10
Arizona, ex rel. Goddard v. Purdue Pharma
Inc., et al.,
No. C20072471 (Ariz. Super. Ct.
May 14, 2007) ......................................................... 8
Burford v. Sun Oil Co.,
319 U.S. 315 (1943) .............................................. 17
Colorado River Water Conservation Dist. v.
United States,
424 U.S. 800 (1976) .............................................. 16
Connecticut v. Purdue Pharma L.P., et al.,
No. X07 HHD-CV-19-6105325-S (Conn.
Super. Ct. Apr. 22, 2019) ..................................... 13
Haywood v. Drown,
556 U.S. 729 (2009) .............................................. 16
Herb v. Pitcairn,
324 U.S. 117 (1945) .............................................. 22
Knick v. Township of Scott, Pa.,
139 S. Ct. 2162 (2019) .................................... 18, 19
Marbury v. Madison,
5 U.S. 137 (1803) .................................................. 18

 iii
Maryland v. Louisiana,
451 U.S. 725 (1981) .............................................. 23
Merrell Dow Pharm. Inc. v. Thompson,
478 U.S. 804 (1986) .............................................. 17
Nebraska v. Colorado,
136 S. Ct. 1034 (2016) ................................ 2, 17, 18
Ohio v. Wyandotte Chems. Corp.,
401 U.S. 493 (1971) ............................ 15, 16, 18, 23
South Carolina v. Regan,
465 U.S. 367 (1984) .................................. 17, 22, 23
Sprint Commc’ns, Inc. v. Jacobs,
571 U.S. 69 (2013) ................................................ 16
Tafflin v. Levitt,
493 U.S. 455 (1990) .............................................. 16
Thompson v. Hanson,
174 P.3d 120 (Wash. Ct. App. 2007) .................... 13
United States v. Purdue Frederick Co., Inc.,
No. 1:07-cr-29 (W.D. Va. May 10, 2007) .............7-8
Wyeth v. Levine,
555 U.S. 555 (2009) .............................................. 18
Younger v. Harris,
401 U.S. 37 (1971) ................................................ 17
Statutes & Other Authorities:
28 U.S.C. § 1251(b)(3) ............................................... 16
37 C.J.S. Fraudulent Conveyances § 3 (2019).......... 21
Ariz. Rev. Stat. § 41-193(A)(3) .................................... 1

 iv
Ariz. Rev. Stat. § 44-1001 ......................................... 14
Ariz. Rev. Stat. § 44-1007(A) .................................... 21
Arizona Opioid Summary, National Institute
on Drug Abuse, Rev. Mar. 2019............................. 5
Barry Meier, Origins of an Epidemic: Purdue
Pharma Knew Its Opioids Were Widely
Abused, N.Y. Times, May 29, 2018........................ 7
Bruce Einhorn et al., OxyContin Billionaires
Chase Global Profits to Offset U.S. Woes,
Bloomberg, Mar. 30, 2019 .................................... 12
David S. Law, Judicial Comparativism and
Judicial Diplomacy, 163 U. Pa. L. Rev.
927 (2015) ............................................................. 22
Ending America’s Opioid Crisis, The White
House ................................................................ 5, 23
Fraudulent Transfer Act, Uniform Law
Comm’n ................................................................. 13
Gary B. Born & Peter R. Rutledge,
International Civil Litigation in United
States Courts (5th ed. 2011) ................................ 22
Greg Allen, Cost of U.S. Opioid Epidemic
Since 2001 Is $1 Trillion and Climbing,
NPR, Feb. 13, 2018 .............................................. 20
Jared S. Hopkins, OxyContin Made The
Sacklers Rich. Now It’s Tearing Them
Apart, Wall Street Journal, July 13, 2019 ............ 4
Michael L. Cook, Bankr. Litig. Manual
§ 11.01 (2019) ....................................................... 14

 v
Mike Mariani, How the American Opiate
Epidemic Was Started by One
Pharmaceutical Company, The Week,
Mar. 4, 2015 ........................................................... 7
Opioid Epidemic, Arizona Dep’t of Health
Services, 2019 ......................................................... 5
Opioid Overdose Crisis, National Institute on
Drug Abuse, Rev. Jan. 2019 ...............................4-5
Sara Randazzo, Purdue Pharma Begins
Resolution of Opioid Cases With $270
Million Deal, Wall Street Journal,
Mar. 26, 2019 ....................................................... 10
Sean D. Murphy, Negotiation of Convention
on Jurisdiction and Enforcement of
Judgments, 95 Am. J. Int’l L. 418 (2001) .......21-22
The Federalist No. 81 (Jacob E. Cooke ed.
1961) ..................................................................... 17
The Sackler Family, Forbes Magazine, 2016 ............. 9
U.S. Opioid Prescribing Rate Maps, U.S
Dep’t of Health & Human Services,
Centers for Disease Control &
Prevention, Oct 3, 2018 ......................................... 9
Understanding the Epidemic, U.S. Dep’t of
Health & Human Services, Centers for
Disease Control & Prevention,
Dec. 19, 2018 .................................................. 4, 5, 7
Voidable Transactions Act Amendments,
Uniform Law Commission ................................... 14

 1
INTRODUCTION
The State of Arizona1 seeks leave to file a bill
of complaint against Purdue and the family that
owns it. Arizona has sued Purdue for its role in
fueling the opioid crisis that is gripping the nation. It
would be difficult to overstate the human, social, and
economic devastation this epidemic has caused. But
what makes the catastrophe especially troubling is
that it is man-made. It is now well-documented how
Purdue and others in the opioid industry engaged in
an array of illegal practices in order to sell more pills
so they could reap astronomical profits. Purdue alone
made billions of dollars pushing these powerfully
addictive drugs on unsuspecting doctors and
patients.
But the Court is not being asked here to
determine Purdue’s culpability for its illegal
practices. In 2007, the company and its top
executives pleaded guilty to federal charges and
Purdue entered into a consent judgment with
Arizona and other States. Whether Purdue violated
that consent decree is currently being litigated
elsewhere. The issue before this Court is Purdue’s
capacity to satisfy liquidated and contingent
liabilities that are the result of its illegal practices.
That is because the Sackler family, which controls
Arizona Attorney General Mark Brnovich brings this
action on behalf of the State of Arizona pursuant to A.R.S.
§ 41-193(A)(3).
1

 2
Purdue, has siphoned billions of dollars out of the
company in recent years. The law does not permit
the Sacklers to reap a windfall while Purdue’s
creditors absorb a massive loss.
The Uniform Fraudulent Transfer Act that
Arizona and forty-two other States have adopted
exists for this very fact pattern. There is
overwhelming evidence—as the Bill of Complaint
demonstrates—that Defendants violated this statute
(and the common-law duties it codifies) by engaging
in fraudulent transfers that threaten Purdue’s
ability to satisfy the myriad opioid-related claims
that are piling up against it. Exercising jurisdiction
and granting Arizona the requested relief would
remedy this significant nationwide problem.
Article III of the Constitution grants this
Court original jurisdiction over “all Cases … in which
a State shall be Party,” including “Controversies …
between a State and Citizens of another State.” This
is such a dispute, because the Defendants are not
citizens of Arizona. That should resolve the
jurisdictional issue. As this Court has many times
explained, the existence of jurisdiction includes the
duty to exercise it. The grant of original jurisdiction
should be no exception. Yet the Court has concluded
otherwise, holding that it has discretion to decline
original jurisdiction based on “policy considerations.”
Nebraska v. Colorado, 136 S. Ct. 1034, 1035 (2016)
(Thomas, J., dissenting from the denial of motion for
leave to file complaint). Those decisions should be
overruled. The Framers chose this Court as an
appropriate forum for Arizona and Defendants to

 3
resolve their dispute. That choice should not be
displaced for reasons that find no home in the text,
structure, or history of the Constitution. No principle
of stare decisis warrants a different result.
Alternatively, the Court can—and should—
avoid this serious constitutional issue by granting
leave to file irrespective of whether Article III
commands it to do so. In recent history, the Court
has been reluctant to accept original jurisdiction over
disputes that are grounded in local law and would
involve complex factfinding. But this dispute raises
neither concern. The Uniform Fraudulent Transfer
Act, as its title suggests, is a uniform national legal
regime. Furthermore, this case will involve
rudimentary and limited factfinding.
Nothing about this action makes it ill-suited to
resolution in this forum. To the contrary, exercising
original jurisdiction here would fulfill the Court’s
responsibility to resolve nationally important issues.
It is urgent that those responsible for the opioids
crisis be held accountable, that their victims be able
to recover for the harm that has been inflicted on
them, and that the Sacklers’ looting of Purdue be
remedied. Only this Court can resolve this pressing
national issue in a uniform and timely manner.
*

*

*

Purdue has reportedly made more than $35
billion selling OxyContin. Since 2007, when the
company pleaded guilty to federal criminal charges
and signed the consent decree with Arizona, Purdue

 4
has distributed more than $4 billion to the Sackler
family. Yet, now that it is facing civil liability for its
central role in the opioids epidemic, Purdue is crying
poverty and threatening bankruptcy. See Jared S.
Hopkins, OxyContin Made The Sacklers Rich. Now
It’s Tearing Them Apart, Wall Street Journal, July
13, 2019, https://on.wsj.com/2xOrgsJ. Only relief
under the Uniform Fraudulent Transfer Act can
ensure Purdue has the money it needs to meet its
liabilities; only a national forum can adequately
address this issue without creating potentially
unresolvable conflicts; and only this Court has the
power under the Constitution to grant the
nationwide relief that is badly needed.
For all these reasons, Arizona respectfully
requests that the Court grant the motion for leave to
file the Bill of Complaint.
STATEMENT OF THE CASE
A.

The Nationwide Opioid Crisis

The opioid crisis is the worst man-made
disaster in American history. There have been
almost 400,000 opioid-related deaths in the United
States in the last two decades. See Understanding
the Epidemic, U.S. Dep’t of Health & Human
Services, Centers for Disease Control & Prevention,
Dec. 19, 2018, https://bit.ly/2jEOHfs. And it is only
getting worse. In 2017, the number of overdose
deaths involving opioids was six times higher than in
1999. Id. Staggeringly, more than 130 people in the
United States die every day from an opioid overdose.
See Opioid Overdose Crisis, National Institute on

 5
Drug Abuse, Rev. Jan. 2019, https://bit.ly/2j6YEE1.
These deaths “are up among both men and women,
all races, and adults of nearly all ages.”
Understanding the Epidemic, supra.
This epidemic is devastating communities
across the United States. It has increased crime,
homelessness, and healthcare costs; it has torn apart
families; and it has damaged the economy. Id. In all,
prescription opioid misuse costs the U.S. economy at
least $78.5 billion annually. Opioid Overdose Crisis,
supra. The President has rightly declared the opioid
crisis to be a public health emergency. Ending
America’s Opioid Crisis, The White House,
https://www. whitehouse.gov/opioids/.
Like its sister States, Arizona has suffered
these harms. Since 2013, opioid-related deaths in
Arizona have risen 76 percent, with 928 deaths
reported in 2017 alone. See Arizona Opioid
Summary, National Institute on Drug Abuse, Rev.
Mar. 2019, https://bit.ly/31Fm0p0. That same year,
Arizona providers wrote an astonishing 61.2 opioid
prescriptions for every 100 Arizonans. See id. The
Arizona Department of Health Services estimates
that between June 2017 and June 2019, more than
3,000 Arizonans died from an opioid overdose. See
Opioid Epidemic, Arizona Dep’t of Health Services,
2019, https://bit.ly/2kaC9Ou. In 2017, Governor
Ducey declared the crisis to be a statewide
emergency. See id.

 6
B.

Purdue’s Role in Causing the Opioid
Epidemic

Opioids have existed for centuries, but they
were not always the scourge they have become.
Before the 1990s, doctors rarely prescribed them.
The medical community understood that, although
opioids could effectively mask pain, they carried
serious risks, including addiction, withdrawal, and
overdose. As a result, they were typically prescribed
only for acute pain, surgery recovery, cancer
treatment, or end-of-life palliative care. Opioids were
not prescribed for chronic or commonplace pain.
Compl. ¶ 27.
But this was not good enough for Defendants
Purdue Pharma L.P., Purdue Pharma Inc., and
Purdue Frederick Company, Inc. (collectively,
“Purdue”). Over the last two decades, Purdue
embarked on an aggressive marketing campaign to
disrupt prevailing medical norms in order to pump up
sales of its opioid painkillers, including OxyContin. In
particular, Purdue illegally minimized the risks
associated with prescription opioids and aggressively
encouraged doctors to prescribe them more broadly.
Indeed, shortly after Purdue began selling OxyContin,
its President, Defendant Richard Sackler, crassly
boasted that “the launch of OxyContin tablets will be
followed by a blizzard of prescriptions that will bury
the competition. The prescription blizzard will be so
deep, dense, and white.” Compl. ¶¶ 28–29.
He was right. Doctors were deceived into
prescribing more of Purdue’s opioids, in higher doses,

 7
and for longer periods of time. Purdue’s profits
soared. By 2000, in fact, the company was realizing
more than a billion dollars each year in sales of
OxyContin alone. See Mike Mariani, How the
American Opiate Epidemic Was Started by One
Pharmaceutical Company, The Week, Mar. 4, 2015,
https://bit.ly/2nlwLfu. And as Purdue’s profits rose,
so too did opioid addiction, overdoses, and deaths. In
just seven years (1999 to 2006), prescription opioid
deaths in the United States rose by nearly 400%. See
Understanding the Epidemic, supra.
Federal and state officials took notice. In 2006,
the Justice Department began investigating Purdue
over its marketing of OxyContin. It discovered that
Purdue knew about “significant” abuse of OxyContin
as far back as 1996, yet actively concealed that
information from the public. Company officials had
received reports that the pills were being crushed
and snorted, stolen from pharmacies, and that some
doctors were being charged with illegally selling
prescriptions. Yet Purdue continued to market
OxyContin as less prone to abuse and addiction than
other opioids. DOJ also discovered that the Sacklers
had received reports detailing the ways in which
Purdue’s opioids were being abused. See Barry
Meier, Origins of an Epidemic: Purdue Pharma
Knew Its Opioids Were Widely Abused, N.Y. Times,
May 29, 2018, https://nyti.ms/2sfaW1G.
In 2007, Purdue and top executives pleaded
guilty to misleading doctors and patients about the
addictive properties of OxyContin and misbranding
the product as “abuse resistant.” United States v.

 8
Purdue Frederick Co., Inc., No. 1:07-cr-29 (W.D. Va.
May 10, 2007). Federal prosecutors had uncovered a
“corporate culture that allowed this product to be
misbranded with the intent to defraud and mislead.”
Id. Purdue paid more than $600 million in fines,
among the largest settlements in U.S. history for a
pharmaceutical company. Id. It also signed a
corporate integrity agreement with the federal
government, promising that the company would not
violate the law in the future. Id.
During this time, Purdue also entered into a
consent judgment with the State of Arizona
(“Consent Judgment”) to resolve the State’s
investigation into the company’s misleading
marketing of OxyContin. See Arizona, ex rel.
Goddard v. Purdue Pharma Inc., et al., No.
C20072471 (Ariz. Super. Ct. May 14, 2007). The
Consent Judgment prohibited Purdue from, among
other things, promoting and marketing its oxycodone
painkillers in deceptive ways, and it required Purdue
to pay a $19.5 million fine, which was distributed to
Arizona and 25 other States that had entered into
similar consent judgments with the company. Id.
C.

Purdue’s Continued Misconduct

Despite all of the fines, settlements,
judgments, and promises, Purdue—with the
knowledge and approval of the Sacklers—continued
to market its opioids illegally through a marketing
campaign that was designed to aggressively increase
sales. Purdue targeted doctors it knew would be
susceptible to its deceptive marketing—e.g., high-

 9
volume opioid prescribers, inexperienced providers,
and primary-care physicians who knew little about
pain management—and encouraged them to
prescribe higher and higher doses for longer periods
of time. Purdue then blamed opioid abuse on
patients, instead of the addictive nature of the drugs.
It pushed opioid prescriptions to elderly patients who
had never taken them before, without disclosing the
higher risks to this vulnerable population. It claimed
that opioids were safer than acetaminophen (e.g.,
Tylenol) and non-steroidal anti-inflammatory drugs
(e.g., ibuprofen) and that the risk of addiction was
insignificant. And it falsely assured doctors and
patients that its reformulated OxyContin was safe.
Compl. ¶¶ 38–40.
This
brazen
campaign
caused
opioid
prescriptions (and Purdue’s profits) to skyrocket. By
2009, Purdue was making more than two billion
dollars each year from sales of OxyContin alone; as of
2016, Purdue had earned more than $31 billion from
OxyContin. See Compl. ¶ 41. That same year, more
than 214 million opioid prescriptions were written in
the United States—enough for two out of every three
Americans to have a prescription. See U.S. Opioid
Prescribing Rate Maps, U.S Dep’t of Health &
Human Services, Centers for Disease Control &
Prevention, Oct 3, 2018, https://bit.ly/2vzRjoj. It is
unsurprising, then, that Forbes identified the
Sacklers as the 19th richest family in the United
States, with a fortune that had soared to $13 billion.
See The Sackler Family, Forbes Magazine, 2016,
https://bit.ly/2MUQY9b.

 10
Purdue’s misconduct again drew scrutiny.
Purdue is presently facing thousands of lawsuits in
which plaintiffs, including counties, cities, towns,
and nearly every State in the country, are seeking to
recover billions of dollars under consumer-protection
and tort law. These actions are slowly winding their
way through the courts. Recently, Purdue agreed to
pay $270 million to settle Oklahoma’s lawsuit. See
Sara Randazzo, Purdue Pharma Begins Resolution of
Opioid Cases With $270 Million Deal, Wall Street
Journal, Mar. 26, 2019, https://on.wsj.com/ 2FCqunj.
Like other States, Arizona is taking action to
redress the harm Purdue has inflicted. On
September 11, 2018, an Arizona state court ordered
Purdue to show cause as to whether it should be
found in violation of the Consent Judgment. See
Arizona, ex rel. Brnovich v. Purdue Pharma L.P., et
al., No. C20072471 (Ariz. Super. Ct. Sept. 11, 2018).
The State is seeking civil penalties of up to $25,000
per violation. That case is set for trial in 2021.
D.

The Sacklers’ Looting of Purdue

Purdue is not a public company. It has long
been owned and operated by eight individuals from a
single family: Defendants Richard Sackler, Beverly
Sackler, David Sackler, Ilene Sackler Lefcourt,
Jonathan Sackler, Kathe Sackler, Mortimer Sackler,
and Theresa Sackler. As members of Purdue’s Board
of Directors, the Sacklers controlled, directed, and
oversaw all of the company’s actions.

 11
The Sacklers have long been aware that
Purdue’s marketing of opioids posed a massive
liability risk to the company. In fact, through their
control of the Board and Richard Sackler’s role as
President, the Sacklers ordered or oversaw much of
Purdue’s illegal marketing, in addition to related
strategic decisions. For example, in 2014, Kathe
Sackler, a board member, pitched “Project Tango,” a
secret plan to grow Purdue beyond providing
painkillers by also providing a drug, Suboxone, to
treat those addicted. According to Ms. Sackler, the
plan could be profitable because “[a]ddictive opioids
and opioid addiction are ‘naturally linked.’” Compl.
¶¶ 47–48.
After Purdue’s settlements and guilty pleas,
Richard Sackler wrote a memo exploring options that
could protect the family from the “dangerous
concentration of risk” they faced. Compl. ¶ 49. As
lawsuits and regulatory scrutiny continued to mount,
the Sacklers recognized the dangers Purdue was
facing. In 2015, Purdue’s chief financial officer,
Edward Mahoney, acknowledged that the company
faced claims of more than a billion dollars and that
the claims, if successful, “would have a crippling
effect on Purdue’s operations and jeopardize
Purdue’s long-term viability.” Compl. ¶ 50. The
potential liability grew exponentially in the following
years.
Despite these massive potential liabilities, the
Sacklers regularly depleted Purdue of its assets.
Between 2008 and 2016, Purdue transferred more

 12
than $4 billion to the Sacklers, as the following chart
shows:

Compl. ¶ 51.
The Sacklers also directed Purdue to transfer
billions of dollars to companies the Sacklers
controlled, including Defendants PLP Associates
Holdings L.P., Rosebay Medical Company L.P., and
Beacon Company. Compl. ¶ 52. Since 2008, the
Sacklers voted to distribute nearly $2 billion to PLP
Associates Holdings L.P. Id. In 2016 alone, the
Sacklers distributed more than $175 million to
themselves. Id. Much of this money has flowed
overseas, including to Defendant Rosebay Medical
Company L.P. See Bruce Einhorn et al., OxyContin
Billionaires Chase Global Profits to Offset U.S. Woes,
Bloomberg, Mar. 30, 2019, https://bloom.bg/2Gj4Pkb.
These transfers all took place at times when

 13
company officials, including the Sacklers, were
keenly aware that Purdue was facing massive
financial liabilities and that these transfers could
prevent it from satisfying eventual judgments.
Not surprisingly, Purdue recently announced
that it is contemplating bankruptcy. In March 2019,
Purdue CEO Craig Landau told the Washington Post
that bankruptcy “is an option. We are considering it,
but we’ve really made no decisions on what course to
pursue. A lot depends on what unfolds in the weeks
and months ahead.” Compl. ¶ 55.
E.

Avoiding
Transfers

the

Sacklers’

Fraudulent

After the Sacklers’ misconduct came to light,
States began suing them to avoid the fraudulent
transfers. See, e.g., Connecticut v. Purdue Pharma
L.P., et al., No. X07 HHD-CV-19-6105325-S (Conn.
Super. Ct. Apr. 22, 2019). More suits are likely to
follow. Every State in the country has a fraudulentconveyance statute and nearly every State faces the
prospect of being unable to recover against Purdue
due to these improper transfers.
These cases have raised (and will continue to
raise) similar if not identical issues and claims.
Virtually all States have adopted the Uniform
Fraudulent Transfer Act. See Fraudulent Transfer
Act, Uniform Law Comm’n, https://bit.ly/2YpMg3Y
(showing that 43 States and the District of Columbia
have adopted UFTA); Thompson v. Hanson, 174 P.3d
120, 126 (Wash. Ct. App. 2007) (noting that “an

 14
explicit purpose of the UFTA is uniformity among
the States”).2 Under the UFTA, any transfer of funds
that is made with intent to hinder, delay, or defraud
present or future creditors may be avoided. These
transfers also can be avoided if there was
constructive fraud, e.g., a transfer of funds without
receiving equivalent value in return.
Arizona seeks leave to file a Bill of Complaint
to claw back Defendants’ transfers under the UFTA.
See Ariz. Rev. Stat. § 44-1001, et seq. As set forth in
the Bill, Arizona alleges that Purdue transferred
significant assets to the Sacklers with the intent to
hinder, delay, or defraud present and future
creditors, including Arizona. See Compl. ¶¶ 46–54.
Arizona also alleges that, when these transfers were
made, Purdue’s remaining assets were unreasonably
small or, in the alternative, that Purdue would incur
debts beyond its ability to pay as they became due.
See id. ¶ 54. Arizona seeks the declaratory and
equitable relief available under the statute, including
Twenty states have amended their UFTA law to
incorporate the Uniform Voidable Transactions Act. See Voidable
Transactions Act Amendments, Uniform Law Commission,
https://bit.ly/2LLrb1L. These amendments “address a few
narrowly-defined issues and are not a comprehensive revision” of
UFTA. Id; see Michael L. Cook, Bankr. Litig. Manual §11.01
(2019) (explaining that “[t]he UVTA is the UFTA with a new
name and minor amendments”). Moreover, in the few states that
have not adopted either the Uniform Fraudulent Conveyance Act
(UFTA’s predecessor), the UFTA, or the UVTA, their “common
law rules or statutes closely resemble the federal and uniform
statutes.” Cook, supra, §11.01.
2

 15
garnishment and attachment, and an appropriate
injunction. See id., Prayer for Relief.
ARGUMENT
The Court should grant the motion for leave to
file the Bill of Complaint. First, Article III requires
the Court to exercise the original jurisdiction the
Constitution grants to it. Second, this urgently
important nationwide dispute calls for the uniform
and timely resolution that only this Court can
provide.
I.

The Constitution Requires the Court to
Grant Leave to File the Bill of Complaint.

Article III provides that “the Supreme Court
shall have original jurisdiction” over “[c]ontroversies
… between a State and Citizens of another State.”
For nearly 200 years, the Court interpreted the
Constitution to mean what it says. In 1971, however,
the Court reversed course. See Ohio v. Wyandotte
Chems. Corp., 401 U.S. 493 (1971). In Wyandotte, the
Court held that original jurisdiction is discretionary
and may be declined if doing so “would not disserve
any of the principal policies underlying the Article
III jurisdictional grant” and would allow the Court to
stay “attuned to its other responsibilities.” Id. at 499.
This more recent conception of the Court’s originaljurisdiction docket is incorrect as a matter of first
principles and should be abandoned.
A
discretionary
approach
to
original
jurisdiction flouts the “time-honored maxim of the
Anglo-American common-law tradition that a court

 16
possessed of jurisdiction generally must exercise it.”
Id. at 496–97. Chief Justice John Marshall, writing
for the Court in Cohens v. Virginia, embraced this
maxim: “We have no more right to decline the
exercise of jurisdiction which is given, than to usurp
that which is not given.” 19 U.S. 264, 404 (1821).
Ever since then, this Court “has cautioned” that
“[j]urisdiction existing, … a federal court’s
‘obligation’ to hear and decide a case is ‘virtually
unflagging.’” Sprint Commc’ns, Inc. v. Jacobs, 571
U.S. 69, 77 (2013) (quoting Colorado River Water
Conservation Dist. v. United States, 424 U.S. 800,
817 (1976)).
That Congress has designated the Court’s
original jurisdiction over such disputes as “not
exclusive,” 28 U.S.C. § 1251(b)(3), does not make it
discretionary. For instance, Alexander Hamilton
explained: “‘the inference seems to be conclusive that
the State courts would have a concurrent jurisdiction
in all cases arising under the laws of the Union,
where it was not expressly prohibited.’” Tafflin v.
Levitt, 493 U.S. 455, 470 (1990) (Scalia, J.,
concurring) (quoting The Federalist No. 82 (E.
Bourne ed. 1947)); see also Haywood v. Drown, 556
U.S. 729, 746 (2009) (Thomas, J., dissenting). Since
the dawn of the Republic, in other words, federal
courts have not had exclusive jurisdiction over most
federal-question cases. Yet no one even thought to
argue that a federal court has unbridled discretion to
decline a case arising under the laws of the United
States merely because a state court could also
adjudicate the controversy. See Colorado River Water
Conservation Dist., 424 U.S. at 817. So too here. That

 17
this original action could be heard in state court does
not relieve this Court of its “virtually unflagging”
duty to exercise the jurisdiction conferred on it by
the Constitution.
This Court has recognized only “narrow
exceptions” to “Chief Justice Marshall’s famous
dictum,” and each of those exceptions has “been
justified by compelling judicial concerns of comity
and federalism.” Merrell Dow Pharm. Inc. v.
Thompson, 478 U.S. 804, 829 n.7 (1986) (citing
Younger v. Harris, 401 U.S. 37 (1971); Burford v.
Sun Oil Co., 319 U.S. 315 (1943)). Yet the
discretionary approach to original jurisdiction not
only departs from the judicial duty under Article III
to exercise jurisdiction that is given, it does so in a
manner that cuts against comity and state interests.
“In cases in which a State might happen to be a
party, it would ill suit its dignity to be turned over to
an inferior tribunal.” The Federalist No. 81 (Jacob E.
Cooke ed. 1961) (A. Hamilton); see also South
Carolina v. Regan, 465 U.S. 367, 396-97 (1984)
(O’Connor, J., concurring); Ames v. Kansas, 111 U.S.
449, 464 (1884).
The Court “rooted” its transformation of
original
jurisdiction
from
“mandatory”
to
“discretionary . . . in policy considerations.” Nebraska
v. Colorado, 136 S. Ct. 1034, 1035 (2016) (Thomas,
J., dissenting from the denial of motion for leave to
file complaint). Because it is “structured to perform
as an appellate tribunal,” the Court concluded that
accepting all original disputes would diminish “the
attention [it] could give to those matters of federal

 18
law and national import as to which [it is] the
primary overseer[].” Wyandotte Chems. Corp., 401
U.S. at 498.
But “policy judgments” are not a basis for
overriding the Constitution’s text. Nebraska, 136 S.
Ct. at 1035 (Thomas, J., dissenting); see also Wyeth v.
Levine, 555 U.S. 555, 604 (2009) (Thomas, J.,
concurring in the judgment). After all, it is settled
that Congress may not alter the Court’s original
jurisdiction. See Marbury v. Madison, 5 U.S. 137, 174
(1803) (“If congress remains at liberty to give this
court appellate jurisdiction, where the constitution
has declared their jurisdiction shall be original; and
original jurisdiction where the constitution has
declared it shall be appellate; the distribution of
jurisdiction, made in the constitution, is form without
substance.”). The same goes for the Court. The
Constitution did not impliedly grant the Supreme
Court the unilateral power to alter the scope of its
original jurisdiction. Article III commands this Court
to accept Arizona’s Bill of Complaint.
Stare decisis does not support retaining a
misguided approach to original jurisdiction. “The
doctrine is at its weakest when [the Court]
interpret[s] the Constitution ... because only this
Court or a constitutional amendment can alter [such]
holdings.” Knick v. Township of Scott, Pa., 139 S. Ct.
2162, 2177 (2019) (citation and quotations omitted).
Treating original jurisdiction as discretionary also
has not created “reliance interests.” Id. at 2179. Last,
treating original as discretionary lacks “consistency
with other ... decisions,” id. at 2178 (citation and

 19
quotations omitted), relating to the virtually
unflagging duty of federal courts to exercise the
jurisdiction granted to them, supra 16-17.
In any event, the Court may postpone the
question of jurisdiction and set the issue for briefing
and argument. See, e.g., Order, No. 18-422, Rucho v.
Common Cause (Jan. 4, 2019). Given the importance
of this issue, the “repeated criticism over the years
from Justices of this Court and many respected
commentators,” Knick, 139 S. Ct. at 2178, and that
original jurisdiction is grounded in the “dignity of
those for whom the provision was made,” Ames, 111
U.S. at 464, the Court should, at a minimum, follow
this prudent course if it sees the issue as decisive in
deciding whether to accept the case.
II.

The Bill of Complaint Raises an Issue of
National Importance that Warrants
Granting Leave to File.

Even if the Court concludes that it is not
required to grant leave to file the Bill, it should
nevertheless accept the case. This issue warrants
resolution at a national level, and none of the
concerns that have previously caused the Court to
decline jurisdiction are present here.
The nationwide opioid epidemic is an
unprecedented public-health crisis. The human toll is
unimaginable. By some estimates, moreover, it has
cost more than a trillion dollars due to increased
spending on health care, social services, and criminal
justice, as well as in lost wages, economic

 20
productivity, and tax revenue. See Greg Allen, Cost
of U.S. Opioid Epidemic Since 2001 Is $1 Trillion
and
Climbing,
NPR,
Feb.
13,
2018,
https://n.pr/2o15XyG. Nearly every State (including
Arizona), thousands of municipalities, and others
who have been harmed have sued Purdue to recover
damages caused by the company’s illegal marketing
practices. Yet because of the Sacklers’ campaign to
drain Purdue of its assets, these victims now face the
prospect of recovering a fraction of what they are
owed.
Absent resolution in a single forum, these
disputes will be fought over and over in nearly every
State in the Nation. This is likely to take years, lead
to inconsistent judgments, and create an inequitable
distribution of money damages.
Allowing Arizona’s original action to proceed
will ensure this issue is resolved in a uniform, timely
manner. Nearly every State has adopted the Uniform
Fraudulent Transfer Act. See supra 14. UFTA
codifies longstanding common-law rules and is
designed “to prevent debtors from prejudicing
creditors by improperly moving assets beyond the
creditors’ reach, invalidat[e] fraudulent transfers,
prevent[] debtors from placing property that is
otherwise available for the payment of their debts
out of the reach of their creditors, and assist[]
creditors in restoring the debtors’ assets to their
pretransfer status to reach those assets that would
have been available to satisfy a judgment but for the

 21
fraudulent
transfer.”
37
C.J.S.
Fraudulent
Conveyances § 3 (2019) (footnotes omitted).
A resolution in this Court thus would be
conclusive on all other similar cases. Moreover, the
UFTA gives the Court broad power to fashion an
equitable remedy. The Court could, among other
things, undo the transfers to satisfy creditors’ claims;
enjoin Purdue and the Sacklers from continuing to
transfer assets out of the company; appoint a
receiver to take charge of the assets; or impose “any
other relief the circumstances may require.” Ariz.
Rev. Stat. § 44-1007(A).
Hence, the remedies Arizona is seeking—
returning to Purdue the money the Sacklers
improperly transferred to themselves—will not just
help Arizona. All of Purdue’s creditors will benefit.
That includes the overwhelming majority of States
and the thousands of municipalities that have filed
claims in courts across the country. This is exactly
the sort of national—as opposed to local—
controversy that warrants the Court’s attention.
Moreover, the Sacklers have taken enormous
efforts to transfer money from Purdue to overseas
companies controlled by the family. Supra 12. Absent
this Court’s intervention, foreign tribunals will be
asked to enforce state-court judgments against
Purdue and the Sacklers. But that likely will be a
difficult task for judgment creditors, as foreign courts
frequently resist enforcing the judgments of
American courts. See, e.g., Sean D. Murphy,
Negotiation of Convention on Jurisdiction and

 22
Enforcement of Judgments, 95 Am. J. Int’l L. 418,
419 (2001) (“[W]hile U.S. courts are perceived as the
most open in the world to the recognition and
enforcement of foreign civil judgments in the absence
of a treaty obligation to do so, the ability of U.S.
judgment holders to enforce their judgments abroad
is much more problematic.”); see also Gary B. Born &
Peter R. Rutledge, International Civil Litigation in
United States Courts 1080 (5th ed. 2011) (same).
This Court is one of the most respected courts in
the world. When it speaks, foreign courts listen. See
David S. Law, Judicial Comparativism and Judicial
Diplomacy, 163 U. Pa. L. Rev. 927, 1027 (2015)
(describing the Supreme Court’s “influence[,]
recognition and prestige” across the globe). Having a
judgment from the Nation’s highest court will best
serve the dignity and comity interests Arizona is
trying to vindicate when it and other jurisdictions
seek to enforce a domestic judgment in a foreign
tribunal.
In short, a decision from this Court would allow
for a uniform resolution of this issue. That is
precisely the type of case the Court has deemed to be
an appropriate exercise of its original jurisdiction.
See, e.g., Regan, 465 U.S. at 382. Indeed, because
these cases raise only issues of state law, this
original petition is likely to be the Court’s only
chance to address this issue. See Herb v. Pitcairn,
324 U.S. 117, 125–26 (1945).
In addition to the clear benefits to the exercise
of this Court’s jurisdiction, none of the policy reasons

 23
for declining original jurisdiction are present here.
Enforcing a uniform code is hardly an “issue[]
bottomed on local law.” Wyandotte Chems. Corp., 401
U.S. at 493. Fraudulent transfer of a company’s
assets is not an area with a “multiplicity of
governmental agencies already involved.” Id. at 505.
Nor does it entail particularly “complex, novel, and
technical factual questions.” Id. at 493; e.g., id.
at 503–04 (refusing to undertake a “formidable”
factfinding process into “factual questions that are
essentially ones of first impression” to scientists,
such as the “novel” question of whether mercury is a
serious water pollutant). The legal regime at issue is
uniform and the factfinding here will be
straightforward.
Nor is it “highly uncertain” whether Arizona’s
interest has been adversely affected. Maryland v.
Louisiana, 451 U.S. 725, 743 (1981). The issue is
incredibly important to the State. Purdue and the
Sacklers have devastated communities across
Arizona, and it is critical that Arizona recover the
funds needed to repair the damage. See supra 4-10.
This factor too weighs in favor of the Court
exercising its jurisdiction. See, e.g., Regan, 465 U.S.
at 382; id. at 384 (Blackmun, J., concurring).
Finally, accepting jurisdiction over this case
would not “put[] this Court into a quandary” whereby
it must “pick and choose arbitrarily among similarly
situated litigants.” Wyandotte Chems. Corp., 401
U.S. at 504. The opioid crisis has been rightly called
“the worst drug crisis in U.S. history.” Ending
America’s Opioid Crisis, supra. The unique

 24
circumstances requiring this Court’s attention are
unlikely to arise again.
CONCLUSION
For these reasons, Plaintiff respectfully
requests that the Court grant the Motion for Leave
to File a Bill of Complaint.
Respectfully submitted,
Mark Brnovich
Attorney General
Rebecca Eggleston
OFFICE OF THE
ARIZONA ATTORNEY
GENERAL
2005 N. Central Ave.
Phoenix, AZ 85004
(602) 542-5025

William S. Consovoy
Counsel of Record
CONSOVOY MCCARTHY
PLLC
1600 Wilson Boulevard,
Suite 700
Arlington, VA 22209
(703) 243-9423
will@consovoymccarthy.com
Ashley Keller
Travis Lenkner
KELLER LENKNER LLC
150 North Riverside Plaza,
Suite 4270
Chicago, IL 60606
(312) 741-5220

July 31, 2019

Attorneys for Plaintiff,
State of Arizona