Boy Scouts Of America Bankruptcy Update 10/23/2024:
The Boy Scouts of America's (“BSA”) bankruptcy plan is being challenged in the Third Circuit Court of Appeals.
Several former Scouts who voted against the bankruptcy plan are appealing the BSA reorganization plan's confirmation arguing that the bankruptcy court lacked the authority to release claims against non-debtors without their consent and therefore wrongfully terminates the rights of survivors to sue third parties involved in Scouting activities (including the BSA Local Councils).
The appellate court asked BSA (and others involved in the appeal) to consider the Supreme Court's ruling in the Purdue Pharma case, which held that bankruptcy courts can't force injured plaintiffs to settle with non-bankrupt parties.
On August 7, 2024, BSA filed a supplemental brief in the Third Circuit arguing the Purdue Pharma decision should have no effect on the BSA bankruptcy case and the appeal should be dismissed. In its briefing, BSA argued the Supreme Court recognized that Purdue Pharma doesn’t affect bankruptcy plans like BSA’s that have been “substantially consummated.”
The settlement involves more than 82,000 men who say they were abused as children by BSA troop leaders. The reorganization plan went into effect in April 2023 and the Settlement Trust has already paid millions to thousands of abuse survivors.
A Letter from the Settlement Trustee From May 2023:
Welcome to the website for the Scouting Settlement Trust. I am pleased to tell you that the plan of reorganization in the Boy Scouts bankruptcy cases is now effective and the settlement trust created under that plan, the Scouting Settlement Trust, is now in existence. Both actions occurred on April 19, 2023. I am the trustee of the Scouting Settlement Trust and have assumed my responsibilities as trustee.
I am also pleased to tell you that two well-qualified individuals who will work closely with me in evaluating the claims of the survivors of scouting sexual abuse have also assumed their responsibilities. They are the Hon. Michael Reagan (Ret.) and Randi Ilyse Roth. Judge Reagan is a retired federal district judge with considerable experience in managing and evaluating serious personal injury cases, including sexual assaults. Ms. Roth is a practicing attorney who has extensive experience in building and implementing claims processes in large, complex cases.
Since April 19, Judge Reagan, Ms. Roth and I have been working hard to get the Scouting Settlement Trust up and running. We have interviewed dozens of firms interested in working with us and have contracted with the key individuals and firms we need to provide services to the Scouting Settlement Trust. All are exceptionally well-qualified. These individuals and firms will be working with us over the next few years to receive and evaluate the claims of the survivors of scouting sexual abuse, collect and manage the assets that the Scouting Settlement Trust now owns, and liquidate those assets in order to maximize the amount of cash that will be available to distribute to the survivors of scouting sexual abuse. We have made great progress over the last two weeks, but this is a big job and it will take time to do it right.
While we recognize that the scouting bankruptcy cases took a long time to resolve and that many of the survivors of scouting sexual abuse have been waiting decades for acknowledgement of, and responses to, their sexual abuse claims, we ask you to be patient with us as we begin our very important jobs of assisting you in telling us about your claims so that we may evaluate them as fairly, consistently and efficiently as possible. We will keep you informed of our progress on this website, so please check back regularly. If you have retained an attorney to assist you with this process, you should stay in communication with them.
The harm experienced by the survivors of scouting sexual abuse is heartbreaking and tragic. While we cannot undo that harm, we can commit to all survivors that the Scouting Settlement Trust will take the time to thoughtfully review all the details of your claims and that each survivor will be treated with fairness, compassion and respect.
Respectfully,
Hon. Barbara J. Houser (Ret.)
Trustee