Chapter 11 announced

[ThenNow]

23 minutes ago, Eagle1993 said:

So, it seems clear that on the claimants side, the belief is that given out BSA is structured, if national liquidates, it will mean the liquidation of the entire BSA assets (all councils).

Yes. This has been the argument all along and was at issue in the TN asset transfer situation last year.

Aren't the councils all re-chartered annually? I assume if the chartering organization ceases to exist, so too the power to grant renewals. Thus, all would necessarily be liquidated by triggering the reversionary interest of National in the assets of all LCs as it is wound down. 

[David CO]

1 hour ago, ThenNow said:

I assume if the chartering organization ceases to exist, so too the power to grant renewals.

  BSA may have to liquidate all of its assets.  It may even have to fire all of its staff.  But so long as its federal charter still exists, the chartering authority still exists.  

Let's suppose BSA is wiped out and ceases to function.  Zero activity.  No charters renewed.  No charters revoked.  I would say the LC's and CO's could continue operating until they are told otherwise.  Nobody will tell them otherwise.  

Just to be on the safe side, BSA should send out a notice instructing LC's and CO's to continue operating on their outdated charters until national reboots.

 

Edited April 1, 2021 by David CO

[ThenNow]

41 minutes ago, David CO said:

But so long as its federal charter still exists, the chartering authority still exists.  

I'm sure he will chime in, but my recollection is CynicalScouter addressed this. I believe he said the charter attaches to the specific BSA corporate entity and dies with its "host." It is an obligate symbiotic relationship.

[vol_scouter]

The local councils are independent 501(c)3 corporations with independent executive boards.  If the BSA liquidates, the local councils could no longer be chartered by the BSA but could certainly continue to serve youth in some manner and would not force a liquidation of the local council.  How that happens will depend upon who owns the BSA intellectual property.

As to the agreement that assets of a local council that ceases to exist is also dependent upon the state in which the council resides.  In my home state, the state maintains that the BSA will not be allowed to be given the local council assets but they will stay in the state.  Whether that is common or even if it would be successful in preventing the assets to leave the state.  

This is all to say that the local councils are independent and that everything is complex.

 

[elitts]

3 hours ago, ThenNow said:

Yes. This has been the argument all along and was at issue in the TN asset transfer situation last year.

Aren't the councils all re-chartered annually? I assume if the chartering organization ceases to exist, so too the power to grant renewals. Thus, all would necessarily be liquidated by triggering the reversionary interest of National in the assets of all LCs as it is wound down. 

I would hope it's not worded that way.  Clearly the intention of such a clause is to make sure that the local council can't "go rogue" and take assets that have been paid for by leveraging the BSA name and go start another organization.  Or alternately, to make sure that if a council goes belly-up, the BSA can make sure any major assets get transferred  to whoever is taking over the area.

But it would be quite a stretch for someone to argue that a clause like this was intended to be interpreted to allow for assets to be siphoned back while the LC was actively functioning.

And beyond THAT, I would certainly hope that if the BSA was forced to go into liquidation, they would back out of bankruptcy long enough to get out from under a trustee's control in order to structure administrative things without court oversight.  They may not be able to sell assets without them being reclaimed once they went back into bankruptcy, but they could certainly do things like make all of their patents and trademarks and materials free-use "for any organization associated with the World Association of Scouting" and alter existing charters to eliminate the reversion clause in order to enable local scouting to continue.

 

[ThenNow]

1 hour ago, vol_scouter said:

As to the agreement that assets of a local council that ceases to exist is also dependent upon the state in which the council resides.  In my home state, the state maintains that the BSA will not be allowed to be given the local council assets but they will stay in the state.  Whether that is common or even if it would be successful in preventing the assets to leave the state.  

May I know which state this is and if the law is long-standing? If the reversionary interest in the established chartering agreement is valid, I would be keen to know the overriding state interest that justifies invalidating it. 

[ThenNow]

49 minutes ago, elitts said:

I would hope it's not worded that way.  Clearly the intention of such a clause is to make sure that the local council can't "go rogue" and take assets that have been paid for by leveraging the BSA name and go start another organization.  Or alternately, to make sure that if a council goes belly-up, the BSA can make sure any major assets get transferred  to whoever is taking over the area.

When he is free, I'm confident CS will give his studied and storied take on this. I'm mostly speculating, being a mostly ig'nert party. This is the argument that is being made, however. If you look back at the documents related to that asset trust transfer scuffle in the summer, it's pretty clear from the TCC's filings. Charters can be yanked for any reason, as I read it. We will await enlightenment. (Not being sarcastic.)

[fred8033]

2 hours ago, vol_scouter said:

The local councils are independent 501(c)3 corporations with independent executive boards.  If the BSA liquidates, the local councils could no longer be chartered by the BSA but could certainly continue to serve youth in some manner and would not force a liquidation of the local council.  How that happens will depend upon who owns the BSA intellectual property.

As to the agreement that assets of a local council that ceases to exist is also dependent upon the state in which the council resides.  In my home state, the state maintains that the BSA will not be allowed to be given the local council assets but they will stay in the state.  Whether that is common or even if it would be successful in preventing the assets to leave the state.  

This is all to say that the local councils are independent and that everything is complex.

 

That is my thought too.  BSA really has little to do with any operation.  Each council would need to revisit fundamentals like recording advancement and even the rights to use training materials.  But, that would be years out resolving such rights.  Until then and even after, councils could continue to run camps, etc.  In fact, councils might have an easier go as they would not need to route "DUES" to a national organization.  Instead, they could keep more of the funds locally.

[ThenNow]

4 hours ago, elitts said:

I would certainly hope that if the BSA was forced to go into liquidation, they would back out of bankruptcy long enough to get out from under a trustee's control in order to structure administrative things without court oversight.  They may not be able to sell assets without them being reclaimed once they went back into bankruptcy, but they could certainly do things like make all of their patents and trademarks and materials free-use "for any organization associated with the World Association of Scouting" and alter existing charters to eliminate the reversion clause in order to enable local scouting to continue.

All intellectual property is wedded to the congressionally chartered entity or entities. It goes away and they can't "deal" or assign it.

Let's say National is liquidated and the LCs remain separate to live another day. You do understand, without the protection of a release by the abuse survivors they would be the named defendants in the sexual abuse lawsuits, along with the COs/SOs, yes? That's the reason people are calling to "burn it all [National] down" and liquidate. The most significant assets are with the secondary, "non-party" entities and insurance policies. 

[David CO]

2 hours ago, ThenNow said:

All intellectual property is wedded to the congressionally chartered entity or entities. It goes away and they can't "deal" or assign it.

It hasn't been an issue since the congressionally chartered entity is recognized by the WOSM.  If BSA goes away, WOSM should be able to recognize another scout association to represent the USA and assign it the use of all the intellectual property under its control.  

WOSM should also be able to temporarily recognize LC's and CO's while it is trying to establish a new scout association. 

 

 

Edited April 1, 2021 by David CO

[ThenNow]

5 minutes ago, David CO said:

It hasn't been an issue since the congressionally chartered entity is recognized by the WOSM.  If BSA goes away, WOSM should be able to recognize another scout association to represent the USA and assign it the use of all the intellectual property under its control.  

Beyond my sphere of limited knowledge. There is still the more looming issue of sexual abuse lawsuits post-hypothetical liquidation, but that bridge is yet to be presented for crossing. I'm thinking it may also be more than 6' off the ground... 

[David CO]

2 hours ago, ThenNow said:

You do understand, without the protection of a release by the abuse survivors they would be the named defendants in the sexual abuse lawsuits, along with the COs/SOs, yes? 

No.  Only those CO's whose units had claims of sexual abuse would be named as defendants.  Not all units would be in that position.  Individual CO's could not be held responsible for nationals actions, or the actions of other units and CO's.

Edited April 1, 2021 by David CO

[ThenNow]

3 minutes ago, David CO said:

No.  Only those CO's whose units had claims of sexual abuse would be named as defendants.  Not all units units would be in that position.  Individual units could not be held responsible for nationals actions, or the actions of other CO's.

Of course. 

[RememberSchiff]

THE OFFICIAL COMMITTEE OF TORT CLAIMANTS’ OBJECTION TO DEBTORS’ THIRD MOTION FOR ENTRY OF AN ORDER EXTENDING THE DEBTORS’ EXCLUSIVE PERIODS TO FILE A CHAPTER 11 PLAN AND SOLICIT ACCEPTANCES THEREOF

excerpts:

More than a year into the chapter 11 cases, the Debtors are unable to propose a confirmable plan. Their plan proposes an inadequate contribution by 253 non-debtor Local Councils and thousands of Chartered Organizations seeking non-consensual third-party releases of 84,000 childhood sexual abuse claims. The non-consensual releases and the channeling of those claims to a trust will effectively discharge the Local Councils and Chartered Organizations over the objection of thousands of men. The time has come to end the Debtors’ plan exclusivity and allow the Tort Claimants’ Committee to file its own plan that allows the Debtors to reorganize without a fire-sale intra-family settlement with the Local Councils and Chartered Organizations

The Boy Scout’s current child protection protocols have been in place since the mid-1990s and the Boy Scouts do not propose revising or updating its child protection protocols even though more than 11,000 of the 84,000 childhood sexual abuse claims arose after the mid-1990s.

The Boy Scouts, Local Councils, and Chartered Organizations simply are not providing adequate compensation. In a settlement offer to the Boy Scouts, the Tort Claimants’ Committee estimated the value of the filed claims based on different types of childhood sexual abuse as follows: (page 2, an itemized chart of type of abuse, claim estimate, number of cases...)

...the claim amounts above yield an average claim value of $811,215, which likely is low

Second, counting each claim as a single act of abuse is an extremely conservative view of the 84,000 claims.

more objections and points

The Tort Claimants’ Committee intends to file its own plan of reorganization. To the greatest extent possible, the plan will mirror substantially the Debtor’s plan as to treatment of creditors other than Abuse Claimants. As to Abuse Claimants, perhaps the most salient change will be the absence of any non-consensual third party releases for the Local Councils and Chartered Organizations. The plan will allow for releases and a channeling injunction to be negotiated by the Tort Claimants’ Committee or the post-confirmation settlement trust but not for the relatively paltry sum offered by the Local Councils.

Under the Tort Claimants’ Committee’s plan, the Boy Scouts are afforded the opportunity to pursue their mission. They will be reorganized as an ongoing financially feasible entity within the parameters of the 5-year business plan that they have submitted.

 

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/884771_2506.pdf

[Eagle1993]

1 hour ago, RememberSchiff said:

THE OFFICIAL COMMITTEE OF TORT CLAIMANTS’ OBJECTION TO DEBTORS’ THIRD MOTION FOR ENTRY OF AN ORDER EXTENDING THE DEBTORS’ EXCLUSIVE PERIODS TO FILE A CHAPTER 11 PLAN AND SOLICIT ACCEPTANCES THEREOF

excerpts:

More than a year into the chapter 11 cases, the Debtors are unable to propose a confirmable plan. Their plan proposes an inadequate contribution by 253 non-debtor Local Councils and thousands of Chartered Organizations seeking non-consensual third-party releases of 84,000 childhood sexual abuse claims. The non-consensual releases and the channeling of those claims to a trust will effectively discharge the Local Councils and Chartered Organizations over the objection of thousands of men. The time has come to end the Debtors’ plan exclusivity and allow the Tort Claimants’ Committee to file its own plan that allows the Debtors to reorganize without a fire-sale intra-family settlement with the Local Councils and Chartered Organizations

The Boy Scout’s current child protection protocols have been in place since the mid-1990s and the Boy Scouts do not propose revising or updating its child protection protocols even though more than 11,000 of the 84,000 childhood sexual abuse claims arose after the mid-1990s.

The Boy Scouts, Local Councils, and Chartered Organizations simply are not providing adequate compensation. In a settlement offer to the Boy Scouts, the Tort Claimants’ Committee estimated the value of the filed claims based on different types of childhood sexual abuse as follows: (page 2, an itemized chart of type of abuse, claim estimate, number of cases...)

...the claim amounts above yield an average claim value of $811,215, which likely is low

Second, counting each claim as a single act of abuse is an extremely conservative view of the 84,000 claims.

more objections and points

The Tort Claimants’ Committee intends to file its own plan of reorganization. To the greatest extent possible, the plan will mirror substantially the Debtor’s plan as to treatment of creditors other than Abuse Claimants. As to Abuse Claimants, perhaps the most salient change will be the absence of any non-consensual third party releases for the Local Councils and Chartered Organizations. The plan will allow for releases and a channeling injunction to be negotiated by the Tort Claimants’ Committee or the post-confirmation settlement trust but not for the relatively paltry sum offered by the Local Councils.

Under the Tort Claimants’ Committee’s plan, the Boy Scouts are afforded the opportunity to pursue their mission. They will be reorganized as an ongoing financially feasible entity within the parameters of the 5-year business plan that they have submitted.

 

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/884771_2506.pdf

So ... I'm guessing the intense mediation session this week is not likely resolving the differences.