Other Torts

Boy Scouts Reject Over a Billion Dollars in Settlements!

According to PRNewswire: the Official Tort Claimants’ Committee (TCC) in the filing of chapter 11 bankruptcy on the part of the Boy Scouts of America (BSA) has announced on Sept. 14th that it doesn’t support the BSA’s proposed settlements with Hartford Insurance Company for the proposed $787 million nor does it support The Church of Jesus Christ Latter Day Saints (LDS) for $250 million. Pachulski Stang Ziehl & Jones LLP (PSZJ), who are representing the TCC view the settlements as poor compensation for the 82,500 survivors that were sexually abused as children. The Office of the United States Trustee appointed the TCC as the official representative for all childhood sexual abuse survivors and refuses to take an easy pay day at the expense of just for the victimized survivors. 

The TCC made this decision after pointing out major flaws within the proposed settlements. The LDS in their view is not paying out fair compensation for the release of the numerous sexual abuse claims that happened directly in local councils governed by LDS. LDS were directly involved in every facet of the Scouting program and under no circumstance should they get out of paying a reasonable settlement. If the proposed settlements were to be approved, each claimant would receive on average an insulting $3,000 payment. The TCC claims that LDS is getting a “get-out-of-jail card” for this incredibly low sum penalty.

Doug Kennedy, Vice Chair of the TCC spoke on the matter saying that “As each month passes in this bankruptcy case, the Boy Scouts’ bankruptcy becomes less about the survivors and more about how the Boy Scouts will exit bankruptcy at the expense of survivors. It will be up to the Tort Claimants’ Committee to continue advancing the interests of survivors because the Boy Scouts, local councils, chartered organizations, and their insurers are unwilling to do the work necessary to reach a resolution that is fair to survivors.”

Similar to LDS; Hartford Insurance Company (HIC) is not making substantive payments that are commensurate with the coverage risk. HIC has increased its initial offer of $650 million to an equally insufficient proposal of $787 million. HIC’s new offer only gives an average $9,500 per survivor or less. 

John Humphrey (Chair of the TCC) said about HIC that “The Tort Claimants’ Committee investigated Hartford’s exposure and it has the ability to fairly compensate survivors without jeopardizing its financial condition. As Chairman of the TCC, I cannot in good conscience support the release of a major insurance company for cents on the dollar.”

The TCC were in support of a restructuring settlement agreement for a consensual plan. This was because the BSA and the “Coalition of Abused Scouts for Justice” had assured TCC that the value for each survivor would be recovered with the billions in available insurance coverage. Surprisingly, the BSA and the Coalition over the past couple months have abruptly changed course and are eyeing an expedited exit from the bankruptcy case through entering settlements with both HIC and LDS which incredibly fail to remotely grasp the billions owed to these victims who were sexually abused as children. 

“In a case where half of the abuse includes multiple instances of penetration and masturbation of children, payments in the range of $10,000 – $12,000 do not begin to justly compensate survivors.The Tort Claimants’ Committee will oppose the LDS and Hartford settlements and any other settlements that fail to compensate survivors fairly” said James Stang of PSZJ.

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