Companies are using bankruptcy courts to thwart lawsuits

Companies are using bankruptcy¹ courts to thwart² lawsuits⁴

　　Transcript⁵

　　More and more wealthy companies and individuals, accused of wrongdoing, are turning to bankruptcy courts to block lawsuits — a practice that's raising alarms with the U.S. Justice Department.

　　A MARTINEZ, HOST:

　　One of the richest companies in the world, Johnson & Johnson, is using a controversial legal strategy in bankruptcy court to block tens of thousands of lawsuits filed by women with cancer. The women believe asbestos in Johnson's baby powder made them sick, a claim that J&J denies. NPR has found that this case is not unique. More and more wealthy corporations and individuals accused of wrongdoing are using bankruptcy courts to shield themselves from lawsuits. Let's bring on NPR's Brian Mann. Brian, you reported on how J&J's bankruptcy maneuver⁶ affected⁷ one woman, Hanna Wilt⁸. Remind us of her story.

　　BRIAN MANN, BYLINE⁹: Sure, A. Hanna Wilt is one of these women who sued J&J, claiming asbestos in Johnson's baby powder gave her a terrible form of cancer called mesothelioma. J&J denies any wrongdoing, says their product was safe. And normally, this is the kind of disagreement that a lawsuit³ like Hanna Wilt's would settle, you know? Did J&J do anything wrong here or not? Instead, J&J used this bankruptcy maneuver to freeze all of these thousands of lawsuits, including hers. And when I spoke¹⁰ to Hanna Wilt, she was outraged¹¹.

　　(SOUNDBITE OF ARCHIVED NPR BROADCAST)

　　HANNA WILT: What I see is, who can play the game best? Big corporations trying to work the system in a way that they don't have to take full responsibility is not something new.

　　MANN: And Hanna Wilt died in February at age 27 while her case was still tangled¹² up in this legal maneuver. I should say, we asked J&J repeatedly for an interview about this, and they declined.

　　MARTINEZ: Brian, how is this allowed to happen? I mean, how can companies use bankruptcy court if they're not bankrupt?

　　MANN: You know, it's a little bit complicated, A. But let me walk you through it. Let's say your valuable, profitable company has been accused of doing something really bad. So you're facing a tsunami¹³ of lawsuits. What you might do is spin off a subsidiary and then push all those lawsuits, all that legal and financial risk, onto the balance sheet of the new firm. Then you shove that other firm into bankruptcy. And as a final step, you offer to help pay that other company's creditors¹⁴ as part of some kind of bankruptcy settlement. It's important to note that not everyone can follow this path. To get a bankruptcy court to agree to this kind of legal maneuver, you probably have to pay a lot of money, maybe billions of dollars. And then in return, you get something big. You get a clean legal slate¹⁵, immunity¹⁶ from future lawsuits. And critics say this amounts to a kind of pay-to-play system of justice for the very wealthy. Most of us obviously can't use it because we're not rich enough to pay for these big settlements.

　　MARTINEZ: OK. So Johnson & Johnson used this kind of bankruptcy maneuver. Are there any other examples?

　　MANN: Yeah. NPR found these bankruptcy maneuvers¹⁷ are shaping some of the biggest court fights in the country over the past few years. Members of the Sackler family, who own Purdue Pharma, aren't themselves bankrupt. They're very wealthy. But they've offered to pay $6 billion as part of a bankruptcy deal. And in exchange, they would get full protection from lawsuits linked to OxyContin and the opioid epidemic¹⁸. In another big case, the U.S. Olympic and Paralympic Committee - and also another case, the Boy Scouts¹⁹, they aren't bankrupt. They have lots of assets. But they used bankruptcy strategies similar to these to block lawsuits linked to child sexual assault.

　　MARTINEZ: But why are bankruptcy judges allowing this?

　　MANN: Yeah. This is fascinating, A. In some parts of the U.S., these bankruptcy maneuvers aren't even legal. There's a kind of patchwork²⁰ of law on this. But it turns out bankruptcy rules allow people and companies to kind of pick their bankruptcy courts. It's called venue²¹ shopping. And so what these companies have found is that there is a relatively²² small group of bankruptcy judges who will allow and even encourage this strategy. Judge Michael Kaplan, who's overseeing the J&J bankruptcy, laid out the argument in a recent ruling that, sometimes, bankruptcy courts like his are the best place to tackle complicated legal cases, again, even when the cases don't actually involve bankrupt companies.

　　MARTINEZ: Is there anyone at all trying to rein²³ all of this in?

　　MANN: Yeah. There are two appeals court cases right now, A, that are challenging these bankruptcy maneuvers, one brought by the Justice Department, which has a bankruptcy watchdog agency. They think this may all be unconstitutional. I also spoke about this with Lindsey Simon, who teaches bankruptcy law at the University of Georgia. She thinks it's possible courts will eventually stop rich companies and individuals from doing this at all.

　　LINDSEY SIMON: I think if you really look closely at what the bankruptcy code allows, it's not altogether clear that this is permitted. And so I do think there's a realistic chance that at some point, a court will say it's not allowed.

　　MANN: Members of Congress are also considering legislation to limit the power of bankruptcy courts to cut these deals. No bills, though, appear to be close to passage. So the bottom line, A, is that for now, the gates to this kind of practice are wide open. Until something changes, everyone I talked to expects to see more and more wealthy companies and individuals going this route, turning to bankruptcy courts when they're accused of wrongdoing, without ever being forced to actually file for bankruptcy.

　　MARTINEZ: That's NPR's Brian Mann. Brian, thanks.

　　MANN: Thank you.

1 bankruptcy   

n.破产；无偿付能力

参考例句：

• You will have to pull in if you want to escape bankruptcy.如果你想避免破产，就必须节省开支。
• His firm is just on thin ice of bankruptcy.他的商号正面临破产的危险。

2 thwart   

v.阻挠，妨碍，反对；adj.横(断的)

参考例句：

• We must thwart his malevolent schemes.我们决不能让他的恶毒阴谋得逞。
• I don't think that will thwart our purposes.我认为那不会使我们的目的受到挫折。

3 lawsuit   

n.诉讼，控诉

参考例句：

• They threatened him with a lawsuit.他们以诉讼威逼他。
• He was perpetually involving himself in this long lawsuit.他使自己无休止地卷入这场长时间的诉讼。

4 lawsuits   

n.诉讼( lawsuit的名词复数 )

参考例句：

• Lawsuits involving property rights and farming and grazing rights increased markedly. 涉及财产权，耕作与放牧权的诉讼案件显著地增加。 来自辞典例句
• I've lost and won more lawsuits than any man in England. 全英国的人算我官司打得最多，赢的也多，输的也多。 来自辞典例句

5 transcript   

n.抄本，誊本，副本，肄业证书

参考例句：

• A transcript of the tapes was presented as evidence in court.一份录音带的文字本作为证据被呈交法庭。
• They wouldn't let me have a transcript of the interview.他们拒绝给我一份采访的文字整理稿。

6 maneuver   

n.策略[pl.]演习；v.(巧妙)控制；用策略

参考例句：

• All the fighters landed safely on the airport after the military maneuver.在军事演习后，所有战斗机都安全降落在机场上。
• I did get her attention with this maneuver.我用这个策略确实引起了她的注意。

7 affected   

adj.不自然的，假装的

参考例句：

• She showed an affected interest in our subject.她假装对我们的课题感到兴趣。
• His manners are affected.他的态度不自然。

8 wilt   

v.(使)植物凋谢或枯萎；(指人)疲倦，衰弱

参考例句：

• Golden roses do not wilt and will never need to be watered.金色的玫瑰不枯萎绝也不需要浇水。
• Several sleepless nights made him wilt.数个不眠之夜使他憔悴。

9 byline   

n.署名；v.署名

参考例句：

• His byline was absent as well.他的署名也不见了。
• We wish to thank the author of this article which carries no byline.我们要感谢这篇文章的那位没有署名的作者。

10 spoke   

n.（车轮的）辐条；轮辐；破坏某人的计划；阻挠某人的行动 v.讲，谈（speak的过去式）；说；演说；从某种观点来说

参考例句：

• They sourced the spoke nuts from our company.他们的轮辐螺帽是从我们公司获得的。
• The spokes of a wheel are the bars that connect the outer ring to the centre.辐条是轮子上连接外圈与中心的条棒。

11 outraged   

a.震惊的，义愤填膺的

参考例句：

• Members of Parliament were outraged by the news of the assassination. 议会议员们被这暗杀的消息激怒了。
• He was outraged by their behavior. 他们的行为使他感到愤慨。

12 tangled   

adj. 纠缠的，紊乱的 动词tangle的过去式和过去分词

参考例句：

• Your hair's so tangled that I can't comb it. 你的头发太乱了，我梳不动。
• A movement caught his eye in the tangled undergrowth. 乱灌木丛里的晃动引起了他的注意。

13 tsunami   

n.海啸

参考例句：

• Powerful quake sparks tsunami warning in Japan.大地震触发了日本的海啸预警。
• Coastlines all around the Indian Ocean inundated by a huge tsunami.大海啸把印度洋沿岸地区都淹没了。

14 creditors   

n.债权人，债主( creditor的名词复数 )

参考例句：

• They agreed to repay their creditors over a period of three years. 他们同意3年内向债主还清欠款。 来自《简明英汉词典》
• Creditors could obtain a writ for the arrest of their debtors. 债权人可以获得逮捕债务人的令状。 来自《简明英汉词典》

15 slate   

n.板岩，石板，石片，石板色，候选人名单；adj.暗蓝灰色的，含板岩的；vt.用石板覆盖，痛打，提名，预订

参考例句：

• The nominating committee laid its slate before the board.提名委员会把候选人名单提交全体委员会讨论。
• What kind of job uses stained wood and slate? 什么工作会接触木头污浊和石板呢？

16 immunity   

n.优惠；免除；豁免，豁免权

参考例句：

• The law gives public schools immunity from taxation.法律免除公立学校的纳税义务。
• He claims diplomatic immunity to avoid being arrested.他要求外交豁免以便避免被捕。

17 maneuvers   

n.策略，谋略，花招( maneuver的名词复数 )

参考例句：

• He suspected at once that she had been spying upon his maneuvers. 他立刻猜想到，她已经侦察到他的行动。 来自辞典例句
• Maneuvers in Guizhou occupied the Reds for four months. 贵州境内的作战占了红军四个月的时间。 来自辞典例句

18 epidemic   

n.流行病；盛行；adj.流行性的，流传极广的

参考例句：

• That kind of epidemic disease has long been stamped out.那种传染病早已绝迹。
• The authorities tried to localise the epidemic.当局试图把流行病限制在局部范围。

19 scouts   

侦察员[机，舰]( scout的名词复数 )； 童子军； 搜索； 童子军成员

参考例句：

• to join the Scouts 参加童子军
• The scouts paired off and began to patrol the area. 巡逻人员两个一组，然后开始巡逻这个地区。

20 patchwork   

n.混杂物；拼缝物

参考例句：

• That proposal is nothing else other than a patchwork.那个建议只是一个大杂烩而已。
• She patched new cloth to the old coat,so It'seemed mere patchwork. 她把新布初到那件旧上衣上，所以那件衣服看上去就象拼凑起来的东西。

21 venue   

n.犯罪地点，审判地，管辖地，发生地点，集合地点

参考例句：

• The hall provided a venue for weddings and other functions.大厅给婚礼和其他社会活动提供了场所。
• The chosen venue caused great controversy among the people.人们就审判地点的问题产生了极大的争议。

22 relatively   

adv.比较...地，相对地

参考例句：

• The rabbit is a relatively recent introduction in Australia.兔子是相对较新引入澳大利亚的物种。
• The operation was relatively painless.手术相对来说不痛。

23 rein   

n.疆绳，统治，支配；vt.以僵绳控制，统治

参考例句：

• The horse answered to the slightest pull on the rein.只要缰绳轻轻一拉,马就作出反应。
• He never drew rein for a moment till he reached the river.他一刻不停地一直跑到河边。