Mallinckrodt Plc (NYSE:MNK) is reportedly considering pulling out of a $1.7 billion settlement related to the opioid crisis, with $1.3 billion still outstanding. Hedge funds that backed the company, including Silver Point Capital, Bracebridge Capital and Alta Fundamental Advisers, are negotiating with the board to take control of the business through a bankruptcy declaration. The funds argue that the settlement could harm the company's financial stability and breach its legal obligations to investors.