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

[elitts]

16 minutes ago, Muttsy said:

Incorrect. The judge will not be deciding the compensation contribution. This is not a real court or a real judge. 

This is let's make a deal court with the judge deciding....well, I can't think of anything she's decided. The parties will come to terms or the bankruptcy will be converted to a liquidation by the BSA or the judge will dismiss the bankruptcy. That's about the extent of her authority. A cram down would need substantial support from the survivors. I don't see it happening. 

I'm not sure why you think this.  A cram down only requires that a plan be better than liquidation, have at least one creditor's support and be fair.  You could argue that the judge won't do it, but it's certainly an option for her.

[ThenNow]

9 minutes ago, CynicalScouter said:

sure the judge can keep saying "dig deeper" forever.

I'll take once or twice, for starters.

[100thEagleScout]

4 minutes ago, elitts said:

I'm not sure why you think this.  A cram down only requires that a plan be better than liquidation, have at least one creditor's support and be fair.  You could argue that the judge won't do it, but it's certainly an option for her.

Just because it’s an option doesn’t mean all creditors are equal here.  A few executives from JPMorgan != 84000 survivor’s voices.  That would be a huge miscarriage of justice.

[Eagle1993]

16 minutes ago, ThenNow said:

Not reading the letters and/or cherry-picking and highlighting that "several indicated they want the BSA to survive is cowardly and not judge-like imho.

I thought the same. She could have just left it at how sad the letters were.  I read a lot of the letters, most do not say she needs to save the BSA ... so I was surprised she picked those.

I was wondering if she was attempting to send a signal where she was headed.  I just wonder if the Coalition thought ... let's try and get the best "voluntary" offer from the BSA before they get a ruling from the judge.   If the judge continues exclusivity, I think that is a sign she is headed to approving the BSA plan. 

[yknot]

48 minutes ago, CynicalScouter said:

The problem is that there is no external source or pressure (with one possible exception) that can change this.

As was pointed out earlier, if this was a poorly run company with shareholders, they could rebel and put in a new board. They cannot in BSA.

And even if they did, who would they get replaced with? During the NAM, it was pointed out that one of the biggest internal fights for years has been council-leaders vs. National HQ. It was pointed out that almost 2/3rds of the National Board are current or former Council leaders.

THAT IS THE PROBLEM. You want change? Real, systemic change? You are NOT going to get it form promoting the same old same old up the chain. Well, maybe, but it would be be accident. Not design.

The idea of hiring Mosby was he was the first non-insider in decades (ever?) to be in that position. Welp, that did no good. We are getting more of the same because they hired more of the same.

Now, here's the exception. I suppose, theoretically, the bankruptcy judge could order a bench clearing that removes all the board and appoints receivers at least temporarily. But that's theoretical and not something anyone (TCC, Coalition, etc.) is asking for.

Perhaps the only outside way to effect it now would be AG investigations in various states that might uncover some of the dysfunction that is inherent in the organization. Scouting insiders have become like boiled frogs -- we are accepting of the dysfunction to some degree. More outside light is needed. 

 

[ThenNow]

24 minutes ago, Eagle1993 said:

I thought the same. She could have just left it at how sad the letters were.  I read a lot of the letters, most do not say she needs to save the BSA ... so I was surprised she picked those.

I was wondering if she was attempting to send a signal where she was headed.  I just wonder if the Coalition thought ... let's try and get the best "voluntary" offer from the BSA before they get a ruling from the judge.   If the judge continues exclusivity, I think that is a sign she is headed to approving the BSA plan. 

Agreed.

If we go in that direction at the objection of all claimant representatives, at some point I will be on the horn with every news outlet I can reach who will listen. I know a number of reporters who will.

Her apparent lack of empathy boggles me. I believe she has a son. On one of the early hearings I seem to recall her mentioning her less than skilled use of the Zoom technology. Something to the effect of, "If you see someone come on screen and help me, that will be my son." Anyone else hear that? Can't she see that he could've been one of us?

Edited June 3, 2021 by ThenNow

[johnsch322]

59 minutes ago, CynicalScouter said:

Let me describe to you just how absurdly complicated this process of control is with something very basic: who hires the local Council executive?

The answer is National has a role: until 2-3 years ago ONLY "commissioned" professionals could be the Council Executive. That meant working your way up the ranks of the BSA (DE, etc.) and taking some BSA professional development courses.

So, this means that National controls the Council Exec, right? Nope. Because the hiring, firing, salary, disciplining, etc. of the Council Exec was controlled by the Council President, Council Board, or some combination.

So, that means that LC controls the Council Exec, right? Well, nope because while National could not and did not directly supervise the Council Exec, they had one trump card. Remember how I said to be Council Exec you had to be a "commissioned" professional? Well, National could revoke the commissioned status of anyone at any time. And since being a commissioned processional was a condition of employment, National could nuke any Council Executive at any time.

So, if I asked you: who "controlled" the Council Executive, the chief paid professional for the LC, what would you answer? National, or the Local Council?

This entire situation is not so clear cut as "LCs rule" or "National rules". Etc.

 

In the corporate world you basically have the same situation.  Corporate veils are pierced quite often.  When push comes to shove so will this one.

[Muttsy]

58 minutes ago, 100thEagleScout said:

Just because it’s an option doesn’t mean all creditors are equal here.  A few executives from JPMorgan != 84000 survivor’s voices.  That would be a huge miscarriage of justice.

JP Morgan is a secured creditor. Its votes don't count. The voting that matters is of the "impaired classes" of creditors. Aside from a few trade creditors, the survivors are the only impaired class of voters that matter. 

Without 2/3rds of the survivors no plan that gives third party releases to non-debtors can be confirmed. 

The survivors are in complete control of the outcome of this case. 

[CynicalScouter]

26 minutes ago, johnsch322 said:

Corporate veils are pierced quite often. 

Corporate veils a) are NOT "pierced quite often" and b) refer to where an individual person, rather than the incorporated entity, is personally liable.

It has nothing to do with the question of whether National "controls" the LCs or whether or not the LCs assets = Nationals.

[Muttsy]

Yes, also reverse corporate veil piercing theory is viable to for the Trustee to get to the LC assets as assets of the bankrupt's estate. 

[CynicalScouter]

Century's ready to call witnesses tomorrow to demonstrate that many if not most of the claims are bogus, therefore proceedings should stop until the 82,500 claims are investigated or at least a sampling of them before allowing those 82,500 claimants a vote on any reorg plan.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/56165724-aaf9-4833-a53d-fd81ae5f5481_5214.pdf

Quote

Unrebutted forensic expert analysis shows that in many instances someone photocopied a lawyer’s signature page and attached it en masse to the POCs.  Some firms had third-party aggregators submit hundreds of POCs by adding an electronic signature in rapid-fire succession—sometimes only seconds apart—to batches of POCs.  Aggregators also submitted many POCs all bearing the same signature—but purportedly signed on behalf of different claimants.  Together with other extraordinary irregularities, this suggests that plaintiffs’ lawyers bought claims from aggregators and sent signature pages to them to attach to POCs for filing without the signing lawyer—or any lawyer—ever having seen them.

 

Edited June 3, 2021 by CynicalScouter

[yknot]

11 minutes ago, Muttsy said:

JP Morgan is a secured creditor. Its votes don't count. The voting that matters is of the "impaired classes" of creditors. Aside from a few trade creditors, the survivors are the only impaired class of voters that matter. 

Without 2/3rds of the survivors no plan that gives third party releases to non-debtors can be confirmed. 

The survivors are in complete control of the outcome of this case. 

"Who h'are you? I must know...."

-- Inigo Montoya. The Princess Bride

[johnsch322]

6 minutes ago, CynicalScouter said:

Corporate veils a) are NOT "pierced quite often" and b) refer to where an individual person, rather than the incorporated entity, is personally liable.

It has nothing to do with the question of whether National "controls" the LCs or whether or not the LCs assets = Nationals.

The question will be are LC's the "alter ego" of the national.

 

[CynicalScouter]

1 minute ago, johnsch322 said:

The question will be are LC's the "alter ego" of the national.

They aren't for numerous reason, but I agree this needs to be litigated.

And it has nothing to do with "veil piercing" which has a very specific meaning in law.

Edited June 3, 2021 by CynicalScouter

[Muttsy]

veil piercing or alter ego, take your pick. 

The LC Charter agreement with was conditioned in part on the LC incorporating in its home state. It also provides that National can dissolve an LC for any reason or no reason. Given this level of control by national, isn't the LC's corporate separateness illusory?