Boy Scouts nears court approval of $2.3 billion bankruptcy settlement

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A statue of a Boy Scout stands at the entrance to the Boy Scouts of America headquarters in Irving, Texas. REUTERS/Tim Sharp

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  • Judge overruled objections from insurers and abuse plaintiffs
  • Boy Scouts lawyer says final changes could be completed in less than a week

(Reuters) – The Boy Scouts of America are set to give final approval to a reorganization plan that would see the youth organization create a $2.3 billion trust to settle decades of claims over 80 000 men who say they were abused in their childhood by troop leaders.

U.S. Bankruptcy Judge Laurie Selber Silverstein in Wilmington, Delaware, in a hearing Thursday dismissed remaining objections to the Boy Scouts’ Chapter 11 plan. She, however, refrained from approving it, instead asking for further revisions which the organization said could be completed relatively quickly.

Boy Scouts attorney Jessica Lauria acknowledged in court that there was “work to do” but said the remaining changes could be completed in less than a week.

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The Boy Scouts had sought confirmation of an amended Chapter 11 plan that sought to respond to Silverstein’s July 29 ruling rejecting parts of the plan. The biggest change was the scrapping of a $250 million settlement between the Boy Scouts and The Church of Jesus Christ of Latter-day Saints, which Silverstein refused to approve because it went too far in protecting the Mormon Church from allegations of abuse that were only loosely related. Scouting activities.

Silverstein dismissed remaining objections to the plan from insurers and sexual abuse claimants who argued that recent revisions went beyond the scope of Silverstein’s July opinion. Insurers, for example, objected to a new claim that the bankruptcy court’s estimate of the value of abuse claims did not act as a limit on insurers’ potential liability for those claims.

Abuse plaintiffs and opposing insurers have said they could appeal if Silverstein upholds the Boy Scouts’ bankruptcy plan.

Despite objections from these groups, the Boy Scouts’ bankruptcy plan has the support of the organization’s two main insurers and 86% of abuse victims who voted for it.

The Boy Scouts filed for bankruptcy in February 2020 after being hit with a flood of sex abuse lawsuits when several US states passed laws allowing accusers to pursue allegations dating back decades.

Silverstein has scheduled a status conference for Sept. 7, but said the hearing may not be necessary if the youth organization completes reviews before then.

The case is In re Boy Scouts of America, US Bankruptcy Court for the District of Delaware, No. 20-10343.

For the Boy Scouts: Jessica Lauria, Mike Andolina, Matt Linder and Laura Baccash of White & Case; and Derek Abbott and Andrew Remming of Morris, Nichols, Arsht & Tunnell

For opposing insurers: James Hallowell of Gibson Dunn & Crutcher and David Christian of David Christian Attorneys

Read more:

US judge throws out parts of Boy Scouts’ $2.7 billion sex abuse deal

Scouts get more support for survivors ahead of final battle over sex abuse deal

Scouts conclude month-long trial over $2.7 billion sex abuse deal

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