DOVER, Del. (AP) – A committee tasked with representing tens of thousands of alleged victims of child sexual abuse in the Boy Scouts of America bankruptcy on Wednesday called on the judge to end BSA’s exclusive rights to file a plan to reorganization, so that he can file his own.
The committee’s filing in court came hours after Boy Scout lawyers filed a fifth version of a draft file bankruptcy plan, which contains settlements the committee describes as “grossly unfair.”
The committee asserted that it is the only party in the case who can come up with a plan that treats survivors of abuse “just and fair” and not “sell themselves” or leave them out.
“More than 18 months after the Chapter 11 cases began, the debtors’ fifth effort for a plan is just as inadequate and flawed as the first four,” the committee’s lawyers wrote.
The committee, joined by lawyers for several insurance companies, also asked the judge to postpone a key hearing, scheduled for next Tuesday, by at least three weeks to allow the parties to consider and file objections to the new plan. of the BSA. The hearing was for the judge to consider the relevance of a disclosure statement outlining a reorganization plan the Boy Scouts filed in July. That plan was replaced by the plan tabled Tuesday, which includes substantial changes and additions.
“Despite the significant changes to the plan …, the debtors are still keen to move forward with the September 21 disclosure statement hearing,” the committee’s lawyers wrote. “This timeline is totally inappropriate.”
The judge quickly issued an order stating that the postponement request will be heard next Tuesday at the time originally scheduled for the disclosure statement hearing.
Two of the major changes in BSA’s new plan are settlement agreements involving one of the organization’s main insurers, The Hartford, and The Church of Jesus Christ of Latter-day Saints, commonly known as The Church. mormon.
The Hartford has agreed to put $ 787 million into a fund that will be created for asylum seekers. The Mormon Church, the largest single sponsor of Scout troops before ending its partnership with BSA early last year, has agreed to contribute $ 250 million.
In return for the payments, the two entities would be released from any further responsibility for child sexual abuse complaints filed by men who said they were assaulted decades ago by Scout leaders and others.
The new plan, for the first time, provides details of the proposed cash and property contributions totaling $ 500 million to the local scout council fund, which manages the day-to-day operations of the BSA.
The proposed contributions range from $ 11,492 in cash by the Rocky Mountain Council in Colorado to a property valued at more than $ 13 million by the Orange County Council in California. The Rocky Mountain Board contribution represents just over 1% of its listed net assets. Orange County’s contribution represents approximately 29.5% of its net assets.
The Michigan Crossroads Council, which faces the highest number of abuse claims of any board, 1,736, is offering to contribute just under $ 8 million in cash and property, or about 18% of its net assets. The Greater New York City council, which ranks second with 1,600 abuse complaints, is reportedly contributing $ 9 million in cash, or about 43% of its net assets.
In return for combined contributions totaling up to $ 820 million and the cession of certain insurance rights to the fund, local councils and the national Boy Scout organization would be released from any additional liability for abuse claims.
The official committee believes that local councils have the financial capacity to contribute “many multiples” of what they offer.
“The BSA’s fifth plan includes agreements with local councils that leave them billions of dollars in cash and goods beyond their current needs to fulfill their scouting mission,” the committee’s lawyers wrote.
The new BSA plan also includes provisions under which churches, civic groups and other sponsors of local scout troops could be released from all liability for sexual abuse complaints.
An approved sponsoring organization could obtain full liability relief in exchange for the cession of its insurance rights and a large cash contribution to the fund. A transfer of insurance rights, without financial contribution, would result in a limited exemption from liability. A sponsoring organization could also refuse to participate and retain its insurance rights, but it would not be protected against future litigation involving claims of abuse.
The official committee maintains that chartered organizations are offered a “jail-free jail release card” in return for transferring their interests in the shared insurance policies that were purchased by the Boy Scouts.
The Boy Scouts, based in Irving, Texas, filed for bankruptcy protection in February 2020, asking to stop hundreds of individual lawsuits and create a fund for the thousands of men who say they have been sexually abused in childhood. Although the organization faced 275 lawsuits at the time, it now faces some 82,500 sexual abuse claims in the bankruptcy case.