September 17, 2019 • 19 mins
The United Auto Workers union went on strike at General Motors sending almost 50,000 members to the picket lines. The union is pushing for GM to improve wages, narrow the pay gap between new and old workers, and reopen plants that have shut down. Among other things, GM wants workers to pay for a greater portion of their healthcare costs. Phoebe Wall Howard, auto and labor reporter for the Detroit Free Press, joins us for more.
Next, OxyContin maker Purdue Pharma has filed for bankruptcy as part of their deal to resolve thousands of lawsuits accusing it of causing an opioid epidemic, but legal battles will still continue because half of the states involved have not signed on to the deal. Sara Randazzo, reporter for the WSJ, joins us for what we know about how Purdue Pharma is trying to settle its part in the opioid crisis.
Finally, actress Felicity Huffman was sentenced last week to serve 14 days in prison and pay a $30,000 fine for her role in the Operation Varsity Blues college admissions cheating scandal. Justin Paperny, founder of White Collar Advice and a federal prison consultant, joins us for what Huffman can expect in prison and also the big questions… what does this mean for other parents waiting for their time in court?
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
It's Tuesday, September. I'm Oscar Ramiraz in Los Angeles, and
this is the daily diet. The United Auto Workers Union
went on strike at General Motors, sending almost fifty thousand
members to the picket lines. The union is pushing for
GM to improve wages, narrow the pay gap between new
(00:21):
and old workers, and reopened plants that have shut down.
Among other things, GM wants workers to pay for a
greater portion of their healthcare costs. Bb Wall Howard, Auto
and Labor reporter for the Detroit Free Press joins us
for more. Next. Oxy cotton maker Perdue Pharma has filed
for bankruptcy as part of their deal to resolve thousands
(00:42):
of lawsuits accusing it of causing an opioid epidemic, but
legal battles will still continue because half of the states
involved have not signed on to the deal. Sarah Rondazzo,
reporter for The Wall Street Journal, joins us for what
we know about how Perdue Pharma is trying to settle
its part in the opioid crisis. Finally, actress Felicity Huffman
(01:02):
was sentenced last week to serve fourteen days in prison
and paid thirty dollar fine. For her role in the
Operation Varsity Blues college admissions cheating scandal. Justin Popperni, founder
of White Collar Advice and federal prison consultant, joins us
for what Huffman can expect in prison and also the
big question what does this mean for other parents waiting
(01:23):
for their time and report it's news without the noise.
Let's dive intry bankruptcy. We made sure that this corporation
state of float, not only by taking concessions contractually, but
we also pay taxes. Our taxes actually helped say this corporation.
So we want to invest in America. We want them
to stop taking our plants and putting them in Mexico.
(01:44):
Joining us now is Phoebe wall Howard and Autos and
labor reporter for the Detroit Free Press. Thanks for joining us, Phoebe.
You we're gonna be talking about this strike by the
United Auto Workers Union against General Motors. Phoebe, I've been
allowing some reporting. You've been out there for quite some
time following this, speaking to a lot of people, and
(02:05):
we'll get some of that reaction in a moment. But
start us off with what this whole thing is about.
About fifty members are currently striking across factories all over
the place, and we're waiting to see if General Motors
and the union will be able to strike a deal.
Tell us what's going on. Well, a couple of things
happening here. Nearly fifty thou workers, as you said, and
that's intense states. So this is not a Detroit or
(02:27):
Ohio issue. This is a national issue. This, of course,
is where the United Auto Workers are saying they broke
her a deal with General Motors during the economic recession.
They forfeited vacation, they forfeited wages, and they forfeited other benefits,
saying we're all in this together when everybody's making money,
bring us back to the table. So the GM workers
(02:49):
actually broke a contract that protected them during the recession,
took massive cuts at the time, and says now, GM
is a very healthy company. It's executive as a paid
very well. Do not cut our healthcare and protect our wages.
What's interesting is the Center for Automotive Research notes that
the u A w wage is actually down sixteen per
(03:11):
cent since those cuts. So that's an industry friendly organization
at the University of Michigan that says the wages today
are lower. So that's what you have here a GM.
They have this kind of two tier system where older
workers are you know, making whatever money they're having, and
new employees are getting hired in at much lower wages.
(03:33):
And some of them say that that causes this kind
of strife between them because they're doing very similar work
and they're getting paid vastly different salaries, absolutely with the
temporary workers and the two tier, and that is an
issue where the workers say they really want parity. Interestingly,
the workers on the line I interviewed last night said
it makes them feel better that everybody has the same wage.
(03:53):
So some of the strikers that I talked to were
the higher wage strikers and they felt it was fair
again bringing everybody up. A number of people hadn't had
pay raises in years. I know. GM has wanted them
to pay a greater portion of their healthcare costs. That
seems to be a big sticking point. They pay very
little the employees compared to average workers across the country.
(04:15):
But that's where GM is trying to save some costs
by having them pay a little bit more of their
healthcare costs. The healthcare is a big issue, like for
all companies. The issue that labor will say is that
their jobs are exceptionally physical and more prone to injury. Frankly,
so their point is, yes, we have better health coverage,
we are also in significantly more dangerous conditions in terms
(04:39):
of repetitive motion and even dealing with robots. I interviewed
some workers that handle all the robots, and they do
things that are unpredictable injury based with all factories, not
general motors specific For now, workers that are striking will
get paid two fifty dollars a week while they're out
of work, although they do have to wait I think
fifteen days before this actually kicks in. Two or fifty
(05:02):
a week is not very much. That's going to be
pretty tough for them to live on. For their part.
On GM side, they said that things won't really get
affected to the consumers for about seventy days or so,
that after that then you'll start seeing certain models or
colors or things that consumers want that they might not
be available at that time. Ten things that you touch
(05:22):
on in terms of the two fifty dollars a week.
One is that the local union halls have been collecting
food and nonperishable so people throughout the community have been
collecting goods in support of the union workers, many non
union people. I saw them delivering cars full of materials,
especially in Flint, people from driving all over the state
(05:43):
of Michigan and delivering net stuff. As far as days
and supply, GM is absolutely confident that it has prepared
and produced, so they do have a stash. However, remember
we learned the teamsters have announced that they are supporting
the U a W work is that means that they
will not be delivering vehicles. They will not deliver them
(06:04):
from the factory and they will not deliver them to
the dealer. So when the truck drivers say we will
not cross this picket line, that is a very serious
issue that hasn't gotten a lot of attention. But that's
one thousand truck drivers who are saying we won't be
returning your phone call. There has been a scandal going
on with the United Auto Workers leadership. They were using
(06:26):
union funds for lavish trips and things like that. How
has this impacted all the negotiations and the workers themselves,
how do they feel about all of this? So the
issue of fraud and scandal and FBI convictions over the
last two years, it's real. With the National United Auto Workers, however,
the workers will say separate from that, many say they're
(06:48):
happy to be striking and they feel like it's overdue.
So for them, the issue is some of the folks
at the table doing the negotiation are under federal scrutiny
right now for potential wrongdoing. These are leader ship teams,
some of which have pleaded guilty and have been given
prison time. So that is a valid issue of valid
concern and frankly, the focus of tremendous anger and resentment. Again,
(07:11):
as you said, lavish lifestyle and specifically involving Fiat Chrysler
and the U a W and outside training funds. I'd
like to remind people this wasn't union dudes. It's a
training money that came from the companies. But it's demoralizing
for the workers to see that. Phoebe wall Howard, one
of the auto and labor reporters for the Detroit Free Press,
(07:32):
thank you very much for joining us. It's a pleasure.
Thank you for people who designed, marketed, lied and flooded
our streets with this dangerous drug. The Sackler family, they
have everything and they want to keep it that way.
(07:55):
Joining us now is Sarah run Dazzo, reporter for the
Wall Street Journal. Thanks for joining us, Sarah, sure thing.
Prdue Pharma has filed for bankruptcy protection. This is part
of a partial deal aimed at resolving thousands of lawsuits
that have been filed by states and municipalities accusing the
company of fueling the opioid crisis. What do we know
(08:15):
about this bankruptcy protection and what's in store for the future,
because it doesn't really seem like this ends everything. So
they entered bankruptcy with a settlement that they say is
their best offer that includes between three and four point
five billion dollars from the company's owners, the Sacklers, and
it essentially then turns the company into a trust that
will be run to continue paying out all of the
(08:38):
cities and local governments that are suing it. But about
half the states are saying that isn't good enough, and
they want more cash guarantee than some other concessions from
the company and their owners, and so they're saying they're
going to fight this effort to put this deal through bankruptcy.
Tell us about the money that the Sacklers have made
off of Herdue Pharma. And selling oxyconton. I know that
they've sold about thirty two billion dollars worth of oxyconton
(09:02):
over the course of its life since the nineties. But
I think there was also some filings that showed that
the Sackler family was sending themselves about a billion dollars
through other offshore accounts and everything. What do we know
about that, So it's hard to tell how much money
the family hasn't and where it's gone. Some court filings
have shown that between two thousand eight and the company
(09:22):
received four billion dollars in their kind of usual profit shares.
A billion that your referenced came out on a Friday.
The New York Attorney General has been trying to subpoena
a whole bunch of banks, maybe thirty or more that
they say did business with the Sacklers, to see where
their money has gone. And so they flagged this one
billion dollars in money from the Sacklers that's gone through
various offshore accounts, But it's unclear where that money comes from,
(09:45):
what part of their wealth it's from when they took
it out of the company. So it's all a little fuzzy,
as any private company's wealth is in terms of how
much they have and where they put it. The thought
behind this is that there's in themselves money so that
they can maybe low ball how much they have to
contribute to this just because you know they're taking that
money off of the books, right, is that that's kind
of the thought behind that. That's the allegation from state
(10:07):
attorneys general that say they don't believe the Sacklers when
they say there's not more money to be put into
this settlement, and so that's why they want to continue
litigating so they can get a full accounting through bank
records and other things to see truly how much money
went to the Sacklers and then where they put it
and whether any of those transfers were improper or not.
How does this impact the next big trial that was
(10:27):
supposed to happen. We know the last one that happened,
Perdue Pharma had already settled out of it, and that's
why Johnson and Johnson kind of maintained the brunt of that.
But there was another one that was expected to start,
I think next month. How does this impact that. Are
they off the hook now since they're filing for bankruptcy
and trying to cut this deal, so almost certainly they
won't appear in that trial. And it's been known for
(10:48):
a while that Purdue is very unlikely to appear in
that big trial because everyone knew they were headed towards
some kind of bankruptcy plan here. And so there's still
in several companies that will be part of that trial
drugmakers and distributors that scheduled to start October twenty one
in Ohio, and so that will still be the big show,
if you will. You know, there could be more silence
ahead of that to take other companies out of it,
(11:09):
but it seems will be more companies in it than
in Oklahoma, where as you said, Johnson and Johnson ended
up being the loan company on trial and that one.
For a long time now, you know, this whole thing
about declaring bankruptcy has been the practice of big organizations
that are facing huge lawsuits. I think earlier this year
PG and E Pacific Gas and Electric saw bankruptcy protection
(11:29):
because they were facing billions of dollars and potential damages
from lawsuits over the wildfires that happened in California. So
a lot of big companies end up going this way
when it looks like they're gonna just be shelling out
a ton of money. That's right, And it's both because
of the money it takes and also because of the logistics.
Bankruptcy can provide one court where everything gets funneled through,
(11:51):
versus having in produced case lawsuits and federal courts and
state courts literally all across the country that they were
fighting a motion here and a hearing there, and it
was exerting a ton of time attorney time and hours
and money. And so bankruptcy can be used in cases
like this as a tool to get everything in one
place and try to focus it a little more. I
(12:13):
know that while they're looking for a little bit more
money and Perdue is trying to get other states municipalities
to sign on to this deal, produced still could eventually
live on, just in a way that all the profits
they end up making goes back to paying off whatever
these settlements are and providing health support services for people
that have been affected by the opioid crisis. So the
(12:34):
plan as it stands now is that the company won't
disappear overnight as of function for at least I think
seven to ten more years at a minimum, and be
turned into a public trust, which is a little bit
of a unique structure for a drug maker. I don't
know that it's really been done before, but essentially trustees
would take over the company and, as you say, continue
to sell products and develop drugs that could helpful to
(12:55):
an addiction, but then essentially any money they make would
all be turned over as part of this settlement. Sarah
run Dazzo, reporter for the Wall Street Journal, Thank you
very much for joining us. Sure thing all of them
knowingly conspired with Singer and others to help their children
(13:19):
either cheat on the s A T or a CT
and or by their children's admission to elite schools through fraud.
This case is about the widening corruption of elite college admissions.
Joining us now is Justin Papperni, founder of White Collar
Advice and federal prison consultant. Thanks for joining us, Justin,
Thanks for the invitation. When we're talking about Felicity Huffman,
(13:40):
we just found out last week that she was sentenced
to fourteen days for her role in Operation Varsity Blues.
This was the college admissions cheating scandal. She also has
to pay about thirty dollars and fines, and then I
think some community service. Also, one of the big questions
surrounding all of this is, now that she got sentenced
(14:02):
to some time, what about a lot of the other
parents that are also involved in this? Justin tell us
a little bit about what you think the implications of
Felicity Huffman sentencing is going to be on Lory Laughlin
and other parents as well well. Because Felicity was sentenced
to prison, every other parent is going to get sentenced
to prison. Felicity did it well by accepting responsibility. It
(14:22):
was fifteen dollars. What she did incredibly well was so
that she had changed her behavior by not engaging with
Center again for her second child. But to your question,
if Felicity was sentenced to prison, the other parents can
expect to be sentenced to prison as well. And she
did seem very remorseful, genuinely remorseful in statements that she
put out there, and you know that's not what you've
(14:43):
been hearing out of Lord Laughlin's camp. They denied to
take any deal. The money amounts are different, which I'm
sure factors into the amount of prison time. So I'm
sure her and her camp are probably a lot more
concerned after seeing what happened with Felicity Hufman. It could
go either way. They could be emboldened because last week
(15:03):
the Probation Department said there were no discernible victims and
no financial laws, so that could embolden the Lawlin camp
to go to trial knowing that if they lose, how
long could the sentence really be because Probation has identified
no victims and no financial law, so it could embolden them.
It could also concern them and the way that Felicity
(15:24):
accept a responsibility she was still sentenced to prison. The
longer this plays out, the less clarity she'll have in
her life. She's already in prison though she's just not
getting credit for it. She's in the land of being unknown,
scared to death, and because she's knowing potentially the inevitable,
it will lead to a longer prison sentence, of course,
because the government is now investing more of our tax
dollars to prosecute her. So tell us a little bit
(15:46):
about what you do. You founded White Color Advice, and
you'd advise people facing time in federal prisons for non
violent and financial crimes and kind of what to expect
when they go in. This is something that is close
to you. You actually went through this in a different
time in your life. We know that Felicity Huffman's attorney
requested that she be allowed to serve her fourteen day
(16:08):
prison sentence at a correctional institution in Dublin, California. This
is a low security correctional institution. What is she expecting
and how do you advise your clients on what to
expect when they're going to face time. Well, I got
into this career, back to your earlier point an interesting way.
I was a baseball player, usc stockbroker for a long time,
made bad choices, got indicted and didn't know how to
(16:30):
prepare or didn't know how to work with a lawyer.
And then when I got to prison in two thousand
and eight, I realized I was not alone and not
knowing what the hell to do. So I sensed an
opportunity to help. I began writing then my first book,
Lessons from Prison, And since two thousand nine and MC
guiding all types of descendant, we helped any decendant willing
to invest the time and go down this foreign world
to them. What I think Felicity has done well, what
(16:52):
any descendant needs to do well is convey that regardless
of the length of the sentence of so many conviction
as a life loan stigma, even if she's got a probation,
she's got a long road ahead of her. So what
we do it? Right? Call her advice to help defendants
go down this foreign world of you know, maintaining their
dignity of holding a lawyer accountable, ensuring they get the
(17:13):
shortest sentence in the most favorable prison, and that leads
to felicity. Will she get the desired prison of her choosing?
The answer is maybe on a fourteen day sentence, there
is no certainty the hero of prisons will designate her
to Dublin Minimum Security Camp in northern California. There is
a chance, because of the brevity of her sentence that
they sent her to the Metropolitan at Center in downtown.
(17:37):
Regardless of where she goes, she's got to do a
lot of listening and thinking rather than talking, Understanding that
she is moving into an environment where women will have
lived for months, years, and decades, and that she shouldn't
seek to exploit to manipulate this environment, or rather seek
to understand it. Is there any indication that she could
(17:57):
get even more of a reduced sentence once she gets
in there, or do you think that she's going to
serve that those full two weeks. You're not eligible for
good times our old prison system unless you get into
twelve months or more. So in a fourteen days sentence,
no good time. She is technically eligible for half way house,
which means she could surrender and they could process her
out to the halfway house. I don't expect that to happen.
(18:18):
I do not expect her to have a job. I
don't think they're gonna move her to segregation. I think
she will be in the minimum security compound for ten
or eleven days and she'll move on with her life.
But I don't expect it to be any harder than
it needs to be. But that's going to come down
to her preparations. As I've said in other media outlets,
I would have encouraged her after she was sentenced TOFF.
(18:38):
So I had to ask the court to romand her
and handcuffs and go directly to the Boston Detention Center
and just get the fourteen days over with. Think about it,
she'd be three days into it right now. Instead, there'll
be this whole kind of media circus and When will
she surrender? Where is she going to go to? Hundreds
of camera has been around her. She could be of
the way done, but that's her choice. I just hope
(19:00):
that she's able to get in, be productive, help people,
and not complain. And that's a quick tip that I'll
offer anyone going to prison. Never complain about the length
of your sentence, especially when you're bunkie could be serving
ten years for a ridiculous non violent drug cut. Justin Papperni,
founder of White Collar Advice and federal prison consultant, thank
you very much for joining us. I appreciate it. Thank you.
(19:29):
That's it for today. Join us on social media at
Daily Dive pod on Twitter and Daily Dive Podcasts on Facebook.
Leave us a comment, give us a rating, and tell
us the stories that you're interested in. Follow us and
I heard Radio, or subscribe wherever you get your podcast.
This episode of The Daily Dive is produced by Victor
Wright and engineered by Tony Sorrentina. I'm Oscar Ramirez and
(19:52):
this was your Daily Dive
It's Tuesday, September. I'm Oscar Ramiraz in Los Angeles, and
this is the daily diet. The United Auto Workers Union
went on strike at General Motors, sending almost fifty thousand
members to the picket lines. The union is pushing for
GM to improve wages, narrow the pay gap between new
(00:21):
and old workers, and reopened plants that have shut down.
Among other things, GM wants workers to pay for a
greater portion of their healthcare costs. Bb Wall Howard, Auto
and Labor reporter for the Detroit Free Press joins us
for more. Next. Oxy cotton maker Perdue Pharma has filed
for bankruptcy as part of their deal to resolve thousands
(00:42):
of lawsuits accusing it of causing an opioid epidemic, but
legal battles will still continue because half of the states
involved have not signed on to the deal. Sarah Rondazzo,
reporter for The Wall Street Journal, joins us for what
we know about how Perdue Pharma is trying to settle
its part in the opioid crisis. Finally, actress Felicity Huffman
(01:02):
was sentenced last week to serve fourteen days in prison
and paid thirty dollar fine. For her role in the
Operation Varsity Blues college admissions cheating scandal. Justin Popperni, founder
of White Collar Advice and federal prison consultant, joins us
for what Huffman can expect in prison and also the
big question what does this mean for other parents waiting
(01:23):
for their time and report it's news without the noise.
Let's dive intry bankruptcy. We made sure that this corporation
state of float, not only by taking concessions contractually, but
we also pay taxes. Our taxes actually helped say this corporation.
So we want to invest in America. We want them
to stop taking our plants and putting them in Mexico.
(01:44):
Joining us now is Phoebe wall Howard and Autos and
labor reporter for the Detroit Free Press. Thanks for joining us, Phoebe.
You we're gonna be talking about this strike by the
United Auto Workers Union against General Motors. Phoebe, I've been
allowing some reporting. You've been out there for quite some
time following this, speaking to a lot of people, and
(02:05):
we'll get some of that reaction in a moment. But
start us off with what this whole thing is about.
About fifty members are currently striking across factories all over
the place, and we're waiting to see if General Motors
and the union will be able to strike a deal.
Tell us what's going on. Well, a couple of things
happening here. Nearly fifty thou workers, as you said, and
that's intense states. So this is not a Detroit or
(02:27):
Ohio issue. This is a national issue. This, of course,
is where the United Auto Workers are saying they broke
her a deal with General Motors during the economic recession.
They forfeited vacation, they forfeited wages, and they forfeited other benefits,
saying we're all in this together when everybody's making money,
bring us back to the table. So the GM workers
(02:49):
actually broke a contract that protected them during the recession,
took massive cuts at the time, and says now, GM
is a very healthy company. It's executive as a paid
very well. Do not cut our healthcare and protect our wages.
What's interesting is the Center for Automotive Research notes that
the u A w wage is actually down sixteen per
(03:11):
cent since those cuts. So that's an industry friendly organization
at the University of Michigan that says the wages today
are lower. So that's what you have here a GM.
They have this kind of two tier system where older
workers are you know, making whatever money they're having, and
new employees are getting hired in at much lower wages.
(03:33):
And some of them say that that causes this kind
of strife between them because they're doing very similar work
and they're getting paid vastly different salaries, absolutely with the
temporary workers and the two tier, and that is an
issue where the workers say they really want parity. Interestingly,
the workers on the line I interviewed last night said
it makes them feel better that everybody has the same wage.
(03:53):
So some of the strikers that I talked to were
the higher wage strikers and they felt it was fair
again bringing everybody up. A number of people hadn't had
pay raises in years. I know. GM has wanted them
to pay a greater portion of their healthcare costs. That
seems to be a big sticking point. They pay very
little the employees compared to average workers across the country.
(04:15):
But that's where GM is trying to save some costs
by having them pay a little bit more of their
healthcare costs. The healthcare is a big issue, like for
all companies. The issue that labor will say is that
their jobs are exceptionally physical and more prone to injury. Frankly,
so their point is, yes, we have better health coverage,
we are also in significantly more dangerous conditions in terms
(04:39):
of repetitive motion and even dealing with robots. I interviewed
some workers that handle all the robots, and they do
things that are unpredictable injury based with all factories, not
general motors specific For now, workers that are striking will
get paid two fifty dollars a week while they're out
of work, although they do have to wait I think
fifteen days before this actually kicks in. Two or fifty
(05:02):
a week is not very much. That's going to be
pretty tough for them to live on. For their part.
On GM side, they said that things won't really get
affected to the consumers for about seventy days or so,
that after that then you'll start seeing certain models or
colors or things that consumers want that they might not
be available at that time. Ten things that you touch
(05:22):
on in terms of the two fifty dollars a week.
One is that the local union halls have been collecting
food and nonperishable so people throughout the community have been
collecting goods in support of the union workers, many non
union people. I saw them delivering cars full of materials,
especially in Flint, people from driving all over the state
(05:43):
of Michigan and delivering net stuff. As far as days
and supply, GM is absolutely confident that it has prepared
and produced, so they do have a stash. However, remember
we learned the teamsters have announced that they are supporting
the U a W work is that means that they
will not be delivering vehicles. They will not deliver them
(06:04):
from the factory and they will not deliver them to
the dealer. So when the truck drivers say we will
not cross this picket line, that is a very serious
issue that hasn't gotten a lot of attention. But that's
one thousand truck drivers who are saying we won't be
returning your phone call. There has been a scandal going
on with the United Auto Workers leadership. They were using
(06:26):
union funds for lavish trips and things like that. How
has this impacted all the negotiations and the workers themselves,
how do they feel about all of this? So the
issue of fraud and scandal and FBI convictions over the
last two years, it's real. With the National United Auto Workers, however,
the workers will say separate from that, many say they're
(06:48):
happy to be striking and they feel like it's overdue.
So for them, the issue is some of the folks
at the table doing the negotiation are under federal scrutiny
right now for potential wrongdoing. These are leader ship teams,
some of which have pleaded guilty and have been given
prison time. So that is a valid issue of valid
concern and frankly, the focus of tremendous anger and resentment. Again,
(07:11):
as you said, lavish lifestyle and specifically involving Fiat Chrysler
and the U a W and outside training funds. I'd
like to remind people this wasn't union dudes. It's a
training money that came from the companies. But it's demoralizing
for the workers to see that. Phoebe wall Howard, one
of the auto and labor reporters for the Detroit Free Press,
(07:32):
thank you very much for joining us. It's a pleasure.
Thank you for people who designed, marketed, lied and flooded
our streets with this dangerous drug. The Sackler family, they
have everything and they want to keep it that way.
(07:55):
Joining us now is Sarah run Dazzo, reporter for the
Wall Street Journal. Thanks for joining us, Sarah, sure thing.
Prdue Pharma has filed for bankruptcy protection. This is part
of a partial deal aimed at resolving thousands of lawsuits
that have been filed by states and municipalities accusing the
company of fueling the opioid crisis. What do we know
(08:15):
about this bankruptcy protection and what's in store for the future,
because it doesn't really seem like this ends everything. So
they entered bankruptcy with a settlement that they say is
their best offer that includes between three and four point
five billion dollars from the company's owners, the Sacklers, and
it essentially then turns the company into a trust that
will be run to continue paying out all of the
(08:38):
cities and local governments that are suing it. But about
half the states are saying that isn't good enough, and
they want more cash guarantee than some other concessions from
the company and their owners, and so they're saying they're
going to fight this effort to put this deal through bankruptcy.
Tell us about the money that the Sacklers have made
off of Herdue Pharma. And selling oxyconton. I know that
they've sold about thirty two billion dollars worth of oxyconton
(09:02):
over the course of its life since the nineties. But
I think there was also some filings that showed that
the Sackler family was sending themselves about a billion dollars
through other offshore accounts and everything. What do we know
about that, So it's hard to tell how much money
the family hasn't and where it's gone. Some court filings
have shown that between two thousand eight and the company
(09:22):
received four billion dollars in their kind of usual profit shares.
A billion that your referenced came out on a Friday.
The New York Attorney General has been trying to subpoena
a whole bunch of banks, maybe thirty or more that
they say did business with the Sacklers, to see where
their money has gone. And so they flagged this one
billion dollars in money from the Sacklers that's gone through
various offshore accounts, But it's unclear where that money comes from,
(09:45):
what part of their wealth it's from when they took
it out of the company. So it's all a little fuzzy,
as any private company's wealth is in terms of how
much they have and where they put it. The thought
behind this is that there's in themselves money so that
they can maybe low ball how much they have to
contribute to this just because you know they're taking that
money off of the books, right, is that that's kind
of the thought behind that. That's the allegation from state
(10:07):
attorneys general that say they don't believe the Sacklers when
they say there's not more money to be put into
this settlement, and so that's why they want to continue
litigating so they can get a full accounting through bank
records and other things to see truly how much money
went to the Sacklers and then where they put it
and whether any of those transfers were improper or not.
How does this impact the next big trial that was
(10:27):
supposed to happen. We know the last one that happened,
Perdue Pharma had already settled out of it, and that's
why Johnson and Johnson kind of maintained the brunt of that.
But there was another one that was expected to start,
I think next month. How does this impact that. Are
they off the hook now since they're filing for bankruptcy
and trying to cut this deal, so almost certainly they
won't appear in that trial. And it's been known for
(10:48):
a while that Purdue is very unlikely to appear in
that big trial because everyone knew they were headed towards
some kind of bankruptcy plan here. And so there's still
in several companies that will be part of that trial
drugmakers and distributors that scheduled to start October twenty one
in Ohio, and so that will still be the big show,
if you will. You know, there could be more silence
ahead of that to take other companies out of it,
(11:09):
but it seems will be more companies in it than
in Oklahoma, where as you said, Johnson and Johnson ended
up being the loan company on trial and that one.
For a long time now, you know, this whole thing
about declaring bankruptcy has been the practice of big organizations
that are facing huge lawsuits. I think earlier this year
PG and E Pacific Gas and Electric saw bankruptcy protection
(11:29):
because they were facing billions of dollars and potential damages
from lawsuits over the wildfires that happened in California. So
a lot of big companies end up going this way
when it looks like they're gonna just be shelling out
a ton of money. That's right, And it's both because
of the money it takes and also because of the logistics.
Bankruptcy can provide one court where everything gets funneled through,
(11:51):
versus having in produced case lawsuits and federal courts and
state courts literally all across the country that they were
fighting a motion here and a hearing there, and it
was exerting a ton of time attorney time and hours
and money. And so bankruptcy can be used in cases
like this as a tool to get everything in one
place and try to focus it a little more. I
(12:13):
know that while they're looking for a little bit more
money and Perdue is trying to get other states municipalities
to sign on to this deal, produced still could eventually
live on, just in a way that all the profits
they end up making goes back to paying off whatever
these settlements are and providing health support services for people
that have been affected by the opioid crisis. So the
(12:34):
plan as it stands now is that the company won't
disappear overnight as of function for at least I think
seven to ten more years at a minimum, and be
turned into a public trust, which is a little bit
of a unique structure for a drug maker. I don't
know that it's really been done before, but essentially trustees
would take over the company and, as you say, continue
to sell products and develop drugs that could helpful to
(12:55):
an addiction, but then essentially any money they make would
all be turned over as part of this settlement. Sarah
run Dazzo, reporter for the Wall Street Journal, Thank you
very much for joining us. Sure thing all of them
knowingly conspired with Singer and others to help their children
(13:19):
either cheat on the s A T or a CT
and or by their children's admission to elite schools through fraud.
This case is about the widening corruption of elite college admissions.
Joining us now is Justin Papperni, founder of White Collar
Advice and federal prison consultant. Thanks for joining us, Justin,
Thanks for the invitation. When we're talking about Felicity Huffman,
(13:40):
we just found out last week that she was sentenced
to fourteen days for her role in Operation Varsity Blues.
This was the college admissions cheating scandal. She also has
to pay about thirty dollars and fines, and then I
think some community service. Also, one of the big questions
surrounding all of this is, now that she got sentenced
(14:02):
to some time, what about a lot of the other
parents that are also involved in this? Justin tell us
a little bit about what you think the implications of
Felicity Huffman sentencing is going to be on Lory Laughlin
and other parents as well well. Because Felicity was sentenced
to prison, every other parent is going to get sentenced
to prison. Felicity did it well by accepting responsibility. It
(14:22):
was fifteen dollars. What she did incredibly well was so
that she had changed her behavior by not engaging with
Center again for her second child. But to your question,
if Felicity was sentenced to prison, the other parents can
expect to be sentenced to prison as well. And she
did seem very remorseful, genuinely remorseful in statements that she
put out there, and you know that's not what you've
(14:43):
been hearing out of Lord Laughlin's camp. They denied to
take any deal. The money amounts are different, which I'm
sure factors into the amount of prison time. So I'm
sure her and her camp are probably a lot more
concerned after seeing what happened with Felicity Hufman. It could
go either way. They could be emboldened because last week
(15:03):
the Probation Department said there were no discernible victims and
no financial laws, so that could embolden the Lawlin camp
to go to trial knowing that if they lose, how
long could the sentence really be because Probation has identified
no victims and no financial law, so it could embolden them.
It could also concern them and the way that Felicity
(15:24):
accept a responsibility she was still sentenced to prison. The
longer this plays out, the less clarity she'll have in
her life. She's already in prison though she's just not
getting credit for it. She's in the land of being unknown,
scared to death, and because she's knowing potentially the inevitable,
it will lead to a longer prison sentence, of course,
because the government is now investing more of our tax
dollars to prosecute her. So tell us a little bit
(15:46):
about what you do. You founded White Color Advice, and
you'd advise people facing time in federal prisons for non
violent and financial crimes and kind of what to expect
when they go in. This is something that is close
to you. You actually went through this in a different
time in your life. We know that Felicity Huffman's attorney
requested that she be allowed to serve her fourteen day
(16:08):
prison sentence at a correctional institution in Dublin, California. This
is a low security correctional institution. What is she expecting
and how do you advise your clients on what to
expect when they're going to face time. Well, I got
into this career, back to your earlier point an interesting way.
I was a baseball player, usc stockbroker for a long time,
made bad choices, got indicted and didn't know how to
(16:30):
prepare or didn't know how to work with a lawyer.
And then when I got to prison in two thousand
and eight, I realized I was not alone and not
knowing what the hell to do. So I sensed an
opportunity to help. I began writing then my first book,
Lessons from Prison, And since two thousand nine and MC
guiding all types of descendant, we helped any decendant willing
to invest the time and go down this foreign world
to them. What I think Felicity has done well, what
(16:52):
any descendant needs to do well is convey that regardless
of the length of the sentence of so many conviction
as a life loan stigma, even if she's got a probation,
she's got a long road ahead of her. So what
we do it? Right? Call her advice to help defendants
go down this foreign world of you know, maintaining their
dignity of holding a lawyer accountable, ensuring they get the
(17:13):
shortest sentence in the most favorable prison, and that leads
to felicity. Will she get the desired prison of her choosing?
The answer is maybe on a fourteen day sentence, there
is no certainty the hero of prisons will designate her
to Dublin Minimum Security Camp in northern California. There is
a chance, because of the brevity of her sentence that
they sent her to the Metropolitan at Center in downtown.
(17:37):
Regardless of where she goes, she's got to do a
lot of listening and thinking rather than talking, Understanding that
she is moving into an environment where women will have
lived for months, years, and decades, and that she shouldn't
seek to exploit to manipulate this environment, or rather seek
to understand it. Is there any indication that she could
(17:57):
get even more of a reduced sentence once she gets
in there, or do you think that she's going to
serve that those full two weeks. You're not eligible for
good times our old prison system unless you get into
twelve months or more. So in a fourteen days sentence,
no good time. She is technically eligible for half way house,
which means she could surrender and they could process her
out to the halfway house. I don't expect that to happen.
(18:18):
I do not expect her to have a job. I
don't think they're gonna move her to segregation. I think
she will be in the minimum security compound for ten
or eleven days and she'll move on with her life.
But I don't expect it to be any harder than
it needs to be. But that's going to come down
to her preparations. As I've said in other media outlets,
I would have encouraged her after she was sentenced TOFF.
(18:38):
So I had to ask the court to romand her
and handcuffs and go directly to the Boston Detention Center
and just get the fourteen days over with. Think about it,
she'd be three days into it right now. Instead, there'll
be this whole kind of media circus and When will
she surrender? Where is she going to go to? Hundreds
of camera has been around her. She could be of
the way done, but that's her choice. I just hope
(19:00):
that she's able to get in, be productive, help people,
and not complain. And that's a quick tip that I'll
offer anyone going to prison. Never complain about the length
of your sentence, especially when you're bunkie could be serving
ten years for a ridiculous non violent drug cut. Justin Papperni,
founder of White Collar Advice and federal prison consultant, thank
you very much for joining us. I appreciate it. Thank you.
(19:29):
That's it for today. Join us on social media at
Daily Dive pod on Twitter and Daily Dive Podcasts on Facebook.
Leave us a comment, give us a rating, and tell
us the stories that you're interested in. Follow us and
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This episode of The Daily Dive is produced by Victor
Wright and engineered by Tony Sorrentina. I'm Oscar Ramirez and
(19:52):
this was your Daily Dive
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