Rite Aid – Restructuring Tort Claims
2026
| Case No.
F325
| Length
2 pgs.
In November 2019, Rite Aid Corporation grappled with severe financial and operational challenges that threatened its solvency. The company faced declining reimbursement rates, loss of market share, and an uncompetitive real estate footprint, compounded by a heavily leveraged capital structure with approximately $3.9 billion in debt, equating to 7.5 times its latest twelve months (LTM) EBITDA. Adding to its troubles, Rite Aid was implicated in a qui tam lawsuit filed by former pharmacists, who alleged the company unlawfully filled prescriptions for controlled substances over a five-year period. This legal challenge escalated in 2023 when the U.S. Department of Justice intervened, leading to more than 1,600 lawsuits that collectively valued opioid-related claims at $2.76 billion.
Learning Objective
This mini-case or “caselet” is used in a financial restructuring course as a part of a broader class discussion on restructuring methods for tort claims and other types of non-debt liabilities.
This material is available for download by current Stanford GSB students, faculty, and staff, as well as Stanford GSB alumni. For inquires, contact the
Case Writing Office.
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