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

[CynicalScouter]

1 hour ago, Eagle1993 said:

So ... BSA lawyers are 2/3 of the total fees and they appear to be delaying the whole process.  At some point ... I wonder if we look back and find out the BSA lawyers' advice was based on their goal of maximizing the money they get out of this entire process.

Let's look at this in the best light possible. In February 2020 the plan was for

1. a quick (1 year) bankruptcy
2. involving ~10,000 claims
3. that also settled claims against local councils
4. but did NOT involve LCs contributing anything.

To quote Luke Skywalker: Amazing. Every word of what you just said was wrong.

1. It wasn't quick
2. It ballooned to 80,000+ claims
3. It is (or isn't) going to settle claims against local councils
4. LCs are most certainly going to pay

It got out of control and so too did the legal bills.

Edited May 6, 2021 by CynicalScouter

[ThenNow]

20 minutes ago, CynicalScouter said:

It got out of control and so too did the legal bills.

I agree with the juxtaposition. The Coalition also added a layer of complexity they didn't exactly see coming. However, I think the lack of early acceptance that "what we thought ain't what we got" paved the way for failed case management and exploded fees. Scrambling to deny, avoid and stonewall are inherently inefficient, especially with this many players. Also, the apparent unwillingness or inability to meaningfully engage the key constituents in the discussions surrounding the Plans they were concocting was a major waste of time, money and whatever goodwill and good faith previously existed.

[CynicalScouter]

2 minutes ago, ThenNow said:

Scrambling to deny, avoid and stonewall are inherently inefficient, especially with this many players.

As I said previously, I see this stonewalling and refusal (or inability) of BSA and the LCs (and let's not forget the COs we have heard absolutely nothing from) ending this way

1. The BSA plans (global, toggle, whatever) will be a) voted on by the sexual abuse victims and rejected OR b) will be so opposed by TCC/FCR/Coalition that the judge simply does not send the plan out for a vote because she knows it will never be approved.
2. BSA's right to come up with its own reorg plan will be deemed forfeit and the "Exclusivity period" will end. This may happen sooner rather than later. The TCC along with the FCR and Coalition or some combination will come up with their own reorganization plan that is approved by the court.
3. That TCC/FCR/Coalition plan will then go to the sexual abuse victims who will approve it.
4. BSA emerges from bankruptcy under the TCC/FCR/Coalition plan.

[CynicalScouter]

3 hours ago, CynicalScouter said:

Century has filed a motion against the TCC, the FCR, and the UCC for burning through over $100 million with nothing (much) to show for it. And they are angry.

Something in the motion today made something I had already sensed clear.

For all the motions filed and money spent, we still have had almost zero actual litigation.

The only real contested matter that has reached a conclusion was setting the bar date for claims. As for the rest?

Quote

The preliminary injunction motions and motions to extend the preliminary injunction have all been settled by stipulation, without the TCC filing any objections or briefs (other than a short joinder to Debtors’ reply to Century’s objection to the terms of the Fourth Stipulation).

So, $100+ million and there's...nothing?

Someone once said that mediation and negotiation is fine, but sometimes you just got to litigate it out.

We are long, long past the point where the parties need to brief the motions and the judge needs to start ruling on these motions. If May 19 turns into another "kick the can down the road" it will simply be insane.

SO FAR it looks like the May 19 agenda will be (could be?)

• 2445: TCC et al. motion to allow them to challenge the Summit/JP Morgan shell game, er, promissory note
• 2475: TCC et al. motion to force a trial court to come up with an estimate of abuse claims
• 2655: BSA's motion to extend the time in which BSA has the exclusive right to come up with a reorganization plan
• 2719: Settlement for a lesser/minor creditor
• 2720: Extending period regarding removal of state actions against BSA
• 3161: Century's newly filed motion to hold back 20% of the professional fees until there's a final settlement

DocketNo	Title	DateFiled
2445	Notice of Hearing  // Re-Notice of Joint Motion of the Official Tort Claimants' Committee and Future Claimants' Representative for Entry of an Order Granting Standing and Authorizing the Prosecution of Certain Challenge Claims on Behalf of the Bankruptcy Estates (related document(s)[2364]) Filed by Future Claimants' Representative, Tort Claimants' Committee. Hearing scheduled for 5/19/2021 at 10:00 AM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #2, Wilmington, Delaware. Objections due by 4/29/2021. (Attachments: # (1) Certificate of Service) (O'Neill, James)	03/24/2021
2475	Notice of Hearing  re Motion of the Future Claimants' Representative, the Official Committee of Tort Claimants, and the Coalition of Abused Scouts for Justice for Entry of an Order, Pursuant to 11 U.S.C. §§ 105(a) and 502(c), (I) Authorizing an Estimation of Current and Future Abuse Claims and (II) Establishing Procedures and Schedule for Estimation Proceedings (related document(s)[2391]) Filed by Coalition of Abused Scouts for Justice, Future Claimants' Representative, Tort Claimants' Committee. Hearing scheduled for 5/19/2021 at 10:00 AM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #2, Wilmington, Delaware. Objections due by 4/15/2021. (Attachments: # (1) Certificate of Service) (O'Neill, James)	03/29/2021
2655	Amended Notice of Hearing of the Debtors' Motion for Entry of Order (I) Scheduling Certain Dates and Deadlines in Connection with Confirmation of the Debtors' Plan of Reorganization, (II) Establishing Certain Protocols, and (III) Granting Related Relief (related document(s)[2618]) Filed by Boy Scouts of America. Hearing scheduled for 5/19/2021 at 10:00 AM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #2, Wilmington, Delaware. Objections due by 5/12/2021. (Moats, Eric)	04/21/2021
2719	Motion to Approve Debtors' Motion for Entry of an Order (I) Approving Lehr Settlement Agreement and (II) Modifying the Automatic Stay, to the Extent Necessary, to Permit Payment of Settlement Amount by Applicable Insurance Filed by Boy Scouts of America. Hearing scheduled for 5/19/2021 at 10:00 AM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #2, Wilmington, Delaware. Objections due by 5/12/2021. (Attachments: # (1) Exhibit A-Proposed Order # (2) Exhibit B-Settlement Agreement # (3) Notice) (Moats, Eric)	04/28/2021
2720	Motion to Extend Debtors' Fourth Motion for Entry of an Order Under 28 U.S.C. Section 1452 and Fed. R. Bankr. P. 9006(b) and 9027, Extending the Period Within Which the Debtors May Remove Civil Actions and Granting Related Relief Filed by Boy Scouts of America. Hearing scheduled for 5/19/2021 at 10:00 AM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #2, Wilmington, Delaware. Objections due by 5/12/2021. (Attachments: # (1) Exhibit A-Proposed Order # (2) Notice) (Moats, Eric)	04/28/2021
3161	Motion to Amend THE COURTS ORDER (I) APPROVING PROCEDURES FOR (A) INTERIM COMPENSATION AND REIMBURSEMENT OF EXPENSES OF RETAINED PROFESSIONALS AND (B) EXPENSE REIMBURSEMENT FOR OFFICIAL COMMITTEE MEMBERS AND (II) GRANTING RELATED RELIEF [DKT. NO. 341] Filed by Century Indemnity Company. Hearing scheduled for 5/19/2021 at 10:00 AM at US Bankruptcy Court, 824 Market St., 6th Fl., Courtroom #2, Wilmington, Delaware. Objections due by 5/12/2021. (Attachments: # (1) Declaration of Stam Stamoulis # (2) Proposed Form of Order # (3) Notice of Motion) (Stamoulis, Stamatios)	05/05/2021

 

 

Edited May 6, 2021 by CynicalScouter

[ThenNow]

15 minutes ago, CynicalScouter said:

So, $100+ million and there's...nothing?

Forgive me for snickering, but this is my favorite excerpt from Century's motion. What a beauty. Good grief...

The estate has been billed for over $1 million for parties to prepare their fee applications. The excessive duplication is generating absurd results. With nearly thirty firms preparing monthly and quarterly fee applications, enormous hours are being consumed simply generating the applications to collect this money. The fee applications appear to seek allowance of over almost $1.4 million for the preparation of those documents alone.

[MattR]

I hope the judge listens to everyone with an appropriate grain of salt and makes her own plan. The quicker the better. At this point the lawyers are just sinking the wheels deeper into the mud, nothing is moving forward.

I'd rather see some progress so the victims can get some closure, the volunteers can start rebuilding and this forum can get back to arguing about the patrol method. 

[fred8033]

Motion 3161 ... https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/202c0596-1e8e-464c-989b-4c661794580c_3161.pdf

So ... For those saying "their" lawyer is doing this from the good of their heart?  Mar 2020:  32 professionals * 175 hours * 1000 = $5.6 million.   I'm sure some are less than full time.  I'm sure some are more than full time.  I'm sure some are way about $1000.   And some are just trying to put bread on their families table at $350 an hour.  The below table itself represents probably $50+ million in fees.  Probably far more.  

        

There is only one set of individuals that will be well compensated in this suit. 

[ThenNow]

9 minutes ago, fred8033 said:

For those saying "their" lawyer is doing this from the good of their heart?  Mar 2020:  32 professionals * 175 hours * 1000 = $5.6 million.   I'm sure some are less than full time.  I'm sure some are more than full time.  I'm sure some are way about $1000.   And some are just trying to put bread on their families table at $350 an hour.  The below table itself represents probably $50+ million in fees.  Probably far more.  

I understand what you're trying to say, but just a note to perhaps clarify. These are professional fees being billed to the estate (BSA funds) by approved counsel and consultants to the "official" parties. These are not fees being paid to the private attorneys and/or consultants representing individual claimants. Not many people do their job out of the "goodness of their heart," attorneys included. That doesn't mean they/we/you/anyone is not passionate and motivated to serve their client or customer. 

[fred8033]

15 minutes ago, ThenNow said:

I understand what you're trying to say, but just a note to perhaps clarify. These are professional fees being billed to the estate (BSA funds) by approved counsel and consultants to the "official" parties. These are not fees being paid to the private attorneys and/or consultants representing individual claimants. Not many people do their job out of the "goodness of their heart," attorneys included. That doesn't mean they/we/you/anyone is not passionate and motivated to serve their client or customer. 

Claimant fees are racking up at similar rates.   The motion document also quotes "TCC professionals are charging the estate similarly high rates, with eight lawyers from the TCC’s lead law firm billing at over $1,000/hour in January 2021, for example."  ... How many law firms and lawyers are representing the claimants?  

I'm not sure if claimants lawyers get paid every three months like BSA's lawyers or have to wait for a final settlement.  

I'm just saying legal fees of both sides are arrogantly huge.  

 

Edited May 6, 2021 by fred8033

[fred8033]

I accidentally tripped into a billing.  I should have figured all the groups legal fees would be visible.  

Here is a TCC vendor bill.   https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/884358_2487.pdf

Many more "Fee Applications" can be found by typing "fee application" into this web site:

https://cases.omniagentsolutions.com/documents?clientid=CsgAAncz%2B6Yclmvv9%2Fq5CGybTGevZSjdVimQq9zQutqmTPHesk4PZDyfOOLxIiIwZjXomPlMZCo%3D&tagid=1153

[ThenNow]

5 minutes ago, fred8033 said:

Claimant fees are racking up at similar rates.   The motion document also quotes "TCC professionals are charging the estate similarly high rates, with eight lawyers from the TCC’s lead law firm billing at over $1,000/hour in January 2021, for example."  ... How many law firms and lawyers are representing the claimants?  

I'm not sure if claimants lawyers get paid every three months like BSA's lawyers or have to wait for a final settlement.  

I'm just saying legal fees of both sides are arrogantly huge.  

I get what you're saying: "Big fees by all." But, TCC counsel represents the TCC who are the official representatives of all claimants before the court. They are not the individual claimants' attorneys. I'm not exactly sure, but might you be mixing up the chosen counsel hired by the US Trustee-appointed Official Tort Claimants Committee with the Coalition folks, TK, other state attorneys or just lumping them all together. If the latter, the individual claimant attorneys have yet to get paid and certainly are not getting paid by the court. On the TCC firm, they have already committed to returning 10% of their fee into the Settlement Trust. That may not amount to "the goodness of their heart," but I've not seen any other firm billing the estate pony up like that. Dat's all I got on this one.

[fred8033]

5 minutes ago, ThenNow said:

... On the TCC firm, they have already committed to returning 10% of their fee into the Settlement Trust. That may not amount to "the goodness of their heart," but I've not seen any other firm billing the estate pony up like that. Dat's all I got on this one.

It's called a "kick-back".  Choose us to be your lawyers and we will give you 10% of our fees.  ... Of course, we'll make sure our fee is at least 20% higher than other clients.  Thus, you both get richer thru the kickback.

We had a local place give a box of stakes if you chose them to replace your car's windshield.  Very popular place ... until the insurance companies succeeded pointing out they were being billed well above the value of the stakes.  I think courts got involved and agreed that the insurance company did not need to pay.

Edited May 6, 2021 by fred8033

[ThenNow]

 

Was supposed to have quoted all this. Sorry.

... On the TCC firm, they have already committed to returning 10% of their fee into the Settlement Trust. That may not amount to "the goodness of their heart," but I've not seen any other firm billing the estate pony up like that. Dat's all I got on this one.

fred8033 It's called a "kick-back".  Choose us to be your lawyers and we will give you 10% of our fees.  ... Of course, we'll make sure our fee is at least 20% higher than other clients.  Thus, you both get richer thru the kickback.

We had a local place give a box of stakes if you chose them to replace your car's windshield.  Very popular place ... until the insurance companies succeeded pointing out they were being billed well above the value of the stakes.  I think courts got involved and agreed that the insurance company did not need to pay.

T/N: Aha. There is the real crux: you're a mind reader and heart renderer with vast knowledge of the firm's history, motives and record of representing creditor committees. I have no such intimate and expansive knowledge, so I'll let you sit with yours, resting your head on their impugned character and all that entails.

Btw, I was at the TCC selection day in Delaware and met the firms applying for the role. I didn't hear anything while talking with them or after their selection was announced about a "package of steaks" and "ginsu knives" deal deal, express or implied. I happen to know they were selected based on experience, reputation, skill, track record and passion for representing sexual abuse tort creditor committees. 

Edited May 6, 2021 by ThenNow

[Eagle1993]

5 minutes ago, ThenNow said:

Btw, I was at the TCC selection day in Delaware and met the firms applying for the role. I didn't hear anything while talking with them or after their selection was announced about a "package of steaks" and "ginsu knives" deal deal, express or implied. I happen to know they were selected based on experience, reputation, skill, track record and passion for representing sexual abuse tort creditor committees. 

FYI ... This is a repeated story.  Just add BSA to the list.

USA Gymnastics - https://www.washingtonpost.com/sports/olympics/while-larry-nassar-victims-wait-lawyers-cash-in-on-usa-gymnastics-bankruptcy/2019/12/17/b782e07a-10a0-11ea-b0fc-62cc38411ebb_story.html

 

[SilverPalm]

I think we've got a couple of lawyers in here who feel it is their duty to defend their profession from anyone who might attack it.  I don't think anyone is really intending to attack the legal profession, fellas - nor is anyone saying lawyers have never had any value to anyone whatsoever who ever lived in any society throughout all of history.

I guess my question is this - to a lot of us on the outside, it looks like the legal teams are just billing, billing, billing, and nothing's getting accomplished.  In the legal profession, is there any reward at all for efficiency?  Why haven't they just moved on and gotten something done yet?  

The cynic in me thinks it's because they're still getting paid regardless of whether the case progresses.  If that's true, the logical conclusion, then, is that they have no impetus to conclude the case, so long as they can continue to bill. I think that's the concern that we legal laypeople have about all of this - why isn't anything happening?  From my (limited) perspective, it looks like the BSA has to just keep paying all these legal bills with nothing to show for it and no end in sight.

Would one of you fine gentlemen with a legal background care to enlighten those of us who don't understand all of this?