Chapter 11 announced

[Eagle94-A1]

This quote concerns me:

Quote

In the filing Friday, the Coalition responded to the insurers singling out one claimant who withdrew his claim when the insurers asked him to respond to questions about it.

“Scaring survivors so that they withdraw presumptively valid claims is not good cause; it is disgusting,” the Coalition lawyers said. Lawyers for several other law firms also filed papers denying what one called “grossly misleading allegations, and outright fabrications by” insurers.

I am concerned because if folks are allowed to not answer questions, and remain part of the lawsuit, then there is no way to verify the false claims from the real ones. 

[Eagle1993]

1 hour ago, Eagle94-A1 said:

I am concerned because if folks are allowed to not answer questions, and remain part of the lawsuit, then there is no way to verify the false claims from the real ones. 

100% agree ... anyone with a claim should be asked to provide information supporting their claim.  In addition to false claims,  it will be important, regardless of the final amount, to compensate claimants fairly and proportionally.  Not all claims will be equal and the payouts to individuals should vary based upon the impact, timing, frequency, etc. of abuse.  If someone cannot answer basic questions, they should not be able to file a claim. 

That said, BSA should stay out of this.  They would lose on PR & financials if they get involved.

[mrjohns2]

4 hours ago, CynicalScouter said:

The article indicates that BSA is asking for this to be over by August or they will run out of money.

Other than loss of membership and loss of donations, is there a reason why they will run out of money?

[CynicalScouter]

11 minutes ago, mrjohns2 said:

Other than loss of membership and loss of donations, is there a reason why they will run out of money?

Having to pay the lawyers I'd imagine. Plus, and the bankruptcy law people will know more than I, but I believe a) during bankruptcy you are required to maintain a status quo meaning no big expenditures like outreach campaigns and rebranding the BSA already announced will happen post-bankruptcy and b) that point you made that I suspect a LOT of donors are holding back out of fear (rightly or wrongly) that anything they donate now will simply be siphoned off to a settlement.

[CynicalScouter]

3 hours ago, Eagle94-A1 said:

I am concerned because if folks are allowed to not answer questions, and remain part of the lawsuit, then there is no way to verify the false claims from the real ones. 

The way it is going to work is this (as I understand it)

1) They are going to do a "sample" of claims; I believe the insurance companies asked for about 100-150. They will then fully review those claims.

2) Based on that sample, they can extrapolate. To keep the numbers easy, If it would cost $100,000 to settle those 100 claims, then it would cost $95,000,000 to settle 95,000 claims.

3) BSA and the insurance companies and the councils would pay $95,000,000 into a victims fund that would be overseen by a victims reviewer/special master (this is what happened with 9/11 claims) who would review the claims over the next decade .

It will take YEARS to sort through all this; the idea is BSA hemorrhaging money and has to get out of bankruptcy by July or August (no/low donations, lawyers bills) or run out of cash. So set up the victims fund and let that work itself out.

[CynicalScouter]

NO ONE on the defense side is talking about just letting anyone file a claim and get cash. And no judge or victims claim fund administrator would let just ANYONE file ANYTHING and get $$$.

The insurance companies in particular are absolutely NOT going to pay 1 PENNY more than they have to.

The details are in this filing https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/872331_2007.pdf

• 11,676 Abuse Claims appear to be duplicates—two or more proofs of claim filed on behalf of the same claimant

• approximately 6,400 Abuse Claims do not identify a perpetrator or provide information that would permit identification of a perpetrator

• approximately 8,100 Abuse Claims do not identify an affiliation with Scouting

• approximately 1,700 Abuse Claims have already been the subject of litigation. (approximately 130 of which have already received some form of payment)

• at least 54,400 Abuse Claims appear to be time-barred under the applicable statute of limitations;

Edited February 10, 2021 by CynicalScouter

[vol_scouter]

14 minutes ago, CynicalScouter said:

NO ONE on the defense side is talking about just letting anyone file a claim and get cash. And no judge or victims claim fund administrator would let just ANYONE file ANYTHING.

The insurance companies in particular are absolutely NOT going to pay 1 PENNY more than they have to.

The details are in this filing https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/872331_2007.pdf

• 11,676 Abuse Claims appear to be duplicates—two or more proofs of claim filed on behalf of the same claimant

• approximately 6,400 Abuse Claims do not identify a perpetrator or provide information that would permit identification of a perpetrator

• approximately 8,100 Abuse Claims do not identify an affiliation with Scouting

• approximately 1,700 Abuse Claims have already been the subject of litigation. (approximately 130 of which have already received some form of payment)

• at least 54,400 Abuse Claims appear to be time-barred under the applicable statute of limitations;

 

 

This is helpful, thank you for posting.

It could be argued that each of these groups should be removed from the calculations to determine the trust fund amount.  However, it is likely that these groups overlap somewhat.  Has anyone seen an estimate for the number that would be disallowed if all categories were to be excluded?

[CynicalScouter]

4 minutes ago, vol_scouter said:

It could be argued that each of these groups should be removed from the calculations to determine the trust fund amount.  However, it is likely that these groups overlap somewhat.  Has anyone seen an estimate for the number that would be disallowed if all categories were to be excluded?

I suspect there is overlap. That is why the insurance companies asked:

1) For an order allowing them to serve discovery on 1400 abuse claimants that they have already randomly selected, and

2) To depose up to 100 claimants from that group seeking more information.

 

[CynicalScouter]

This group is the key

Quote

at least 54,400 Abuse Claims appear to be time-barred under the applicable statute of limitations;

The insurance companies in particular may simply refuse to pay claims that are time-barred under state law. Then what? BSA holds the bag? Councils? Or maybe BSA and the Councils tell those 54,400 claimants to go away?

[vol_scouter]

1 minute ago, CynicalScouter said:

This group is the key

The insurance companies in particular may simply refuse to pay claims that are time-barred under state law. Then what? BSA holds the bag? Councils? Or maybe BSA and the Councils tell those 54,400 claimants to go away?

I am not an attorney but would feel that if the claimant's case is outside of the statute of limitations then no one would be compelled to pay.

[CynicalScouter]

5 minutes ago, vol_scouter said:

I am not an attorney but would feel that if the claimant's case is outside of the statute of limitations then no one would be compelled to pay.

There's two problems:

1) Legally compelled vs. morally obligated. BSA in particular has said it wants to work with all victims. Does that mean that BSA offers counseling services, regardless of the statute of limitations? Etc.

2) The future: there's a lot of states that have created look back windows that allow for claims to be reopened. New York for example reopened its lookback window, then extended how long that look back window would remain open.

So, what happens if a state decides to reopen the look back window next year? Do those claims suddenly come back to hit BSA and Councils?

 

[skeptic]

It will be interesting to see how the court responds to the apparent "issues" with the claimants and their lawyers.  To me, a biased layman, it seems obvious that there is a great deal of pile on, so to speak, much with little or no validity.  Logic, or at least to me, says that if you were traumatized in some manner to the level of "now" choosing to bring it to the fore, then you should also remember the basic details of when, who, and so on.  IF they can be shown to have already had some form of restitution already, then it should not be able to be reexhibited.  

I personally find the indications of fraud and misleading action by some of the lawyers involved to be abhorrent and grounds for disbarment if I understand the supposed legal guidance on being a lawyer.  

No matter what, the ball is in our court to find local ways to overcome the frenzy of media hype and simply show the positive parts of scouting and its presence in the community.

[CynicalScouter]

1 hour ago, skeptic said:

I personally find the indications of fraud and misleading action by some of the lawyers involved to be abhorrent and grounds for disbarment if I understand the supposed legal guidance on being a lawyer.  

Keep in mind, there's multiple different groups of lawyers here. I believe

1) Some (Kosnoff et al.) are more interested in killing off BSA than anything else and will do what they can to get there.

2) Some are focused on victims they want to see compensated.

3) Some don't care if BSA lives or dies, they just want to get paid.

I don't think there's much overlap between these groups.

 

Edited February 10, 2021 by CynicalScouter

[Eagle1993]

On 2/10/2021 at 10:40 AM, skeptic said:

No matter what, the ball is in our court to find local ways to overcome the frenzy of media hype and simply show the positive parts of scouting and its presence in the community.

For us, Covid is having a much bigger impact than the bankruptcy.  That said, I do hope the bankruptcy goes away before fall recruiting.

On 2/10/2021 at 9:34 AM, CynicalScouter said:

This group is the key

The insurance companies in particular may simply refuse to pay claims that are time-barred under state law. Then what? BSA holds the bag? Councils? Or maybe BSA and the Councils tell those 54,400 claimants to go away?

BSA/Councils shouldn't get involved.  Let's look at it from Top down.  How much can BSA really provide without liquidating.  Let's say National sells all land, HA bases, artwork & investments and can create a $1B victims fund.  Lets say the councils pitch in $2B for a total fund of $3B.  

The average payout by the Catholic church has been over $700K per victim.

So, with a $3B fund, BSA can afford to pay 4,285 victims. Let's say insurance funds help cover some of this, so perhaps we can double the amount of claims we could cover to 8,500 or so.  

There are 95,000 claims.  BSA's financial situation is not changed if it is 95,000, 50,000, 25,000, 15,000 or even 10,000 claims.  They would need to see 85,000+ claims dropped before they could even consider reducing the victims fund.

BSA needs to assume there will be more than 10,000 claims and simply focus on negotiating the settlement amount.  That negotiation will be considered by the plaintiff team and basically they will have to decide if its worth fighting it further in court. 

The real financial impact will be the insurance companies.   Lets say they need to pay out 350,000 per claim.  They will care if its 10,000 or 95,000 ($3.5B to $33.3B).  They are not going bankrupt (at least yet) and this will also be a precedent for other companies/organizations they insure.  I expect insurance companies will not care if fighting this in court for 5 - 10 years will force BSA to liquidate.   BSA needs to stay out of this, exit bankruptcy by making their best offer and let the insurance companies figure out if they will pay $30B or $3B over the next decade.

 

 

[CynicalScouter]

6 minutes ago, Eagle1993 said:

 BSA needs to stay out of this, exit bankruptcy by making their best offer and let the insurance companies figure out if they will pay $30B or $3B over the next decade.

It is funny you put it this way. I had district roundtable last night during which a member of Council staff sat in to give us general updates.

Take what I am about to say with copious salt but it is consistent with various things my Council's said over the last 3-4 months and I am feeling MUCH better about BSA's chances.

1. The original idea when BSA filed bankruptcy was to have a restructuring plan by March 2021. Despite everything, they are still kinda on track (it is pushed to April).
2. "Most of plaintiffs lawyers are not looking to target councils." This was/is the Kosnoff problem; he wants to Councils liquidated/all Council assets put on the table. "Most" of the plaintiffs lawyers would be OK with councils paying into a victim's trust fund based on a formula/computation/algorithm that is being worked out that measures a) the number of claims filed in that council b) likelihood of success that factors in that the statute of limitations in that state may have lapsed BUT could always be brought back (see the "look back" windows" in NY, PA, etc.) and c) available Council assets.
3. The plan now is to have a restructuring plan by April and approved by the court so that the May annual meeting can be the restart and "rebranding" of BSA. The insurance companies and the plaintiffs attorneys would then spend the next however long slitting each others throats, but BSA would be out of the equation at that point.
4. The entire sticking point is Kosnoff and his side. Again, see point #2. If Kosnoff pushes this and demands that the court rule on the question of access to Council assets (namely, that Councils are not independent but are in fact appendages of National) or convinces the court that in fact yes Council assets = National assets, this whole thing gets blow up. BSA National is then "on a ticking clock" to run out of cash on hand/no cash flow by July or August. Then things get desperate; can BSA get bridge loans or come up with a plan to survive until the bankruptcy ends? And of course if you are like Kosnoff and simply want BSA dead, dragging this out is in your interest (if not your client's).

So on the one hand I am more optimistic than I was and it is possible that BSA can be out of this mess by summer, but then again there are still too many moving parts to know for sure.