Chapter 11 announced - Part 3 - BSA's Toggle Plan

[ThenNow]

3 minutes ago, Eagle1970 said:

And mine as well.

An unfortunate fraternity, but better than being alone.

[CynicalScouter]

BSA has now released its new solicitation plan (how will the various creditors vote).

If you thought TCC, FCR, and Coalition was/were mad before, just wait.

As you read it, remember Class 8 = Direct Abuse Claims.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/88d65e3f-2adb-4828-aac7-021073afe799_2726.pdf

1) BSA wants this done by September 1. Let me just say that heck will freeze over and we'll be skating on the ice before that happens.

Event	Proposed Date
Voting Record Date	May 19, 2021
Solicitation Date	June 2, 2021
Rule 3018(a) Motion Deadline	June 17, 2021
Publication Deadline	July 2, 2021
Plan Supplement Deadline	July 16, 2021
Voting Resolution Event Deadline	July 30, 2021 or as otherwise ordered by the Bankruptcy Court
Voting Deadline	July 30, 2021 at 4:00 p.m. (Eastern Time)
Plan Objection Deadline	July 30, 2021 at 4:00 p.m. (Eastern Time)
Voting Report Deadline	August 16, 2021
Confirmation Brief/Plan Reply Deadline	August 20, 2021
Confirmation Hearing	August 30, 2021 at 10:00 a.m. (Eastern Time)

2) BSA does NOT want ANY statements from the TCC, FCR, Coalition, or ANYONE ELSE involved in the Direct Abuse Claims in that ballot pack other than BSA and any other "co-proponents" (see section on Distribution of Solicitation Packages, page 12 in the PDF)

Quote

if a party becomes a co-proponent of the Plan on or before the Solicitation Date, solely for holders of Direct Abuse Claims, a letter from such applicable proponents recommending that holders of Direct Abuse Claims vote to accept the Plan, in the Debtors’ discretion; and

So if TCC, FCR, or Coalition rollover and accept the BSA plan, they can have that info transmitted to the abuse victims. If they reject/object the plan, they are told to shut up and sit in a corner.

3) They are offering an expedited payout of $1,500 to any sexual abuse victim (Class 8 or Class 9) who just wants to walk away now.

Edited April 29, 2021 by CynicalScouter

[Eagle1993]

22 minutes ago, CynicalScouter said:

o if TCC, FCR, or Coalition rollover and accept the BSA plan, they can have that info transmitted to the abuse victims. If they reject/object the plan, they are told to shut up and sit in a corner.

I believe the TCC talked about this in one of their townhalls.  They said they will get to put in their recommendation.  It is common practice in bankruptcies and the BSA will lose that aspect of their strategy.

I expect if the BSA pushes and the court rules in their favor, TCC and easily appeal, delaying the whole process.

Since I expect this plan to fail (both versions) I wonder what is BSA's next move.

[ThenNow]

18 minutes ago, CynicalScouter said:

BSA has now released its new solicitation plan (how will the various creditors vote).

If you thought TCC, FCR, and Coalition was/were mad before, just wait.

As you read it, remember Class 8 = Direct Abuse Claims.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/88d65e3f-2adb-4828-aac7-021073afe799_2726.pdf

1) BSA wants this done by September 1. Let me just say that heck will freeze over and we'll be skating on the ice before that happens.

They do enjoy a friendly game of poke the bear, don't they? It is either a case of utter incompetence or a self-inflicted dissociative state. 

18 minutes ago, CynicalScouter said:

So if TCC, FCR, or Coalition rollover and accept the BSA plan, they can have that info transmitted to the abuse victims. If they reject/object the plan, they are told to shut up and sit in a corner.

So, heck freezes over, Styx is impassable due to ice shoves, Cerberus rolls over and plays dead, and the TCC, FCR and Coalition suffer a simultaneous, protracted brain freeze. Got it. I'm going with D, "None of the Above," for the win. Ain't gonna happen.

19 minutes ago, CynicalScouter said:

3) They are offering an expedited payout of $1,500 to any sexual abuse victim (Class 8 or Class 9) who just wants to walk away now.

Boy howdy! That gets me 285.71 Limited Edition Starbuck's Salted Caramel Mochas, pre-tax. I'm so excited. Jk. I don't like caramel, mochas, Starbucks or being insulted to my face. (I did research for this joke.)

[5thGenTexan]

Do attorneys get paid by the word?  😀   I just give up trying to read it.

[CynicalScouter]

5 minutes ago, Eagle1993 said:

Since I expect this plan to fail (both versions) I wonder what is BSA's next move.

I am still thinking that BSA won't ever get its plan (global, toggle, whatever) out the door and that an alternative TCC/FCR/Coalition (or some combo) will be what ultimately gets sent out.

[Eagle1993]

That was a LONG document.  I reviewed the redline a bit ... looks like the major changes

• $1,500 payout option for those that select it (if the plan is approved).  
• Updated dates
• Clarified process for firms voting for their claimants.  BSA will need written evidence for each claimant that they agree to have their legal representative vote for them or BSA will send the ballot directly to the claimant.  (Before, it appears they would have allowed the firm to sign a document stating they have approval to vote).  Tight timeline to submit those documents to BSA as well.

 

 

[CynicalScouter]

16 minutes ago, ThenNow said:

They do enjoy a friendly game of poke the bear, don't they? It is either a case of utter incompetence or a self-inflicted dissociative state. 

One possibility is Hanlon's razor: never attribute to malice that which is adequately explained by stupidity.

But these are not stupid lawyers. So, let's assume good faith and a modicum of smarts here.

1) BSA is bleeding out and they want to avoid death by exsanguination. As such, they'll latch onto ANY deal or ANY agreement that gets them out of bankruptcy the fastest. If you ever took lifeguard training, it is the same thing. A drowning person will climb onto ANYTHING that elevates their head above water, even if that means trying to climb on top of the lifeguard. It is the logic if self-preservation: cut any deal, make any concession, just to make it stop. The focus is on getting any kind of plan, period because...

2) They are assuming that in the end they will be believed when they tell the abuse victims in that ballot package "this is really, really the best we can do." And here's the thing, in keeping with #1 above, BSA leadership and lawyers may really, truly believe that. They may believe, for example, that while $650 million from Hartford is a pittance, they'll take $650 million NOW if it means getting out of bankruptcy by September 1. And they assume that they can persuade 67% of the abuse victims of that as well. Of course, there are a good number of abuse victims who will look at the absolute pittance of a number and say "No, thanks. We'll wait and see what we can get down the line."

3) One more possibility is they know something we don't. For example, we know that BSA has been promised money from the (independent or "independent") Boy Scouts of America Foundation to tie BSA over post-bankruptcy for a few years. I wonder if BSA's mad dash rush is also with an eye towards someone(s) telling BSA "the minute you get out of bankruptcy, there's $100 million in donations waiting for you."

[ThenNow]

56 minutes ago, 5thGenTexan said:

Do attorneys get paid by the word?  😀   I just give up trying to read it.

Yes and double for footnotes, triple for terms of art and quadruple for Latin.

[MYCVAStory]

Any plan and ballot are a long way from being approved and going out.  The debtor's job is to push it's plan ahead.  The TCC's job is to say "not so fast."  Regardless, it's safe to assume that when something does go out for vote the TCC WILL have a statement included with the packet regarding its viewpoint as to what is in the best interest of victims and points to consider. 

 

 

[ThenNow]

1 hour ago, CynicalScouter said:

BSA is bleeding out and they want to avoid death by exsanguination. As such, they'll latch onto ANY deal or ANY agreement that gets them out of bankruptcy the fastest. If you ever took lifeguard training, it is the same thing. A drowning person will climb onto ANYTHING that elevates their head above water, even if that means trying to climb on top of the lifeguard. It is the logic if self-preservation: cut any deal, make any concession, just to make it stop.

Now that you mention it, this scenario brings to front of mind the effort my "drowning swimmer" put into taking me down with him during lifesaving. 

[yknot]

4 hours ago, CynicalScouter said:

3) One more possibility is they know something we don't. For example, we know that BSA has been promised money from the (independent or "independent") Boy Scouts of America Foundation to tie BSA over post-bankruptcy for a few years. I wonder if BSA's mad dash rush is also with an eye towards someone(s) telling BSA "the minute you get out of bankruptcy, there's $100 million in donations waiting for you."

I have also wondered this. They couldn't possibly be this stupid. It's possible they might have some kind of back pocket plan.

 

[CynicalScouter]

BSA and JP Morgan filed their objections to some of the recent TCC/FCR/Coalition moves to go after Summit/Arrow, WV.

BSA's effort to try and protect Summit/Arrow https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/79c9867a-f837-49ff-a8ab-562ce6c6dfdc_2733.pdf

Arguing, in effect, that the BSA-Arrow relationship and shell game isn't "fraudulent". (Hint: When you try to hide assets by putting phony notes payable on something, it's fraudulent).

JP Morgan 1 https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/48cdda3a-e13e-48de-80ed-a376c6676dd8_2732.pdf

Arguing now is not the time to determine Summit's status, wait until later in the Reorg process.

And JP Morgan 2 https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/48cdda3a-e13e-48de-80ed-a376c6676dd8_2732.pdf

Another attempt at defending Summit/Arrow WV

[Eagle1970]

While realizing the goal is to maximize recovery, it looks to me that the lion's share of potential is with the insurers.  Nowhere have I seen that the BSA has the asset value to offer a reasonable settlement without them.  If the BSA has the potential contribution of $1B and the insurers have the potential of $15B, I know where my efforts would be directed.  

[Eagle1993]

5 minutes ago, Eagle1970 said:

While realizing the goal is to maximize recovery, it looks to me that the lion's share of potential is with the insurers.  Nowhere have I seen that the BSA has the asset value to offer a reasonable settlement without them.  If the BSA has the potential contribution of $1B and the insurers have the potential of $15B, I know where my efforts would be directed. 

If the TCC can prove the JP Morgan loans are actually unsecured debt and the HA bases are non restricted assets, that is a several hundred million dollar win.  I don't expect TCC or lawyers representing claimants to let these go without a fight.  (I watched groups fight for four years over ~$50M).  The back & forth is expected ... the bankruptcy court will need to rule, followed by appeals process.  

I do think BSA (and JP Morgan) should defend their position.  I'm not a lawyer, so I have no idea which side is correct.  What I don't understand is how they can try and proceed with a plan without these major decisions decided (at least by the bankruptcy court).