Chapter 11 Announced - Part 4 Revised Plan

[Muttsy]

16 minutes ago, CynicalScouter said:

And in the context of the bankruptcy, that is not going to happen. There is no way the insurance companies are going to be forced to pay the same for a claim that is timely and valid vs. one that is valid but time barred. Unjust? Unfair? Perhaps yes. But no bankruptcy judge is going to, in effect, put aside all state statutes of limitations.

Bankruptcy judges don’t decide tort law issues especially and including SOL. A claimant has a right under the code to liquidate his claim in state or federal court. She has no power to take that away. 

[CynicalScouter]

2 minutes ago, Muttsy said:

Bankruptcy judges don’t decide tort law issues especially and including SOL.

I agree. Which is why the idea that she is going to order the insurance companies to pay, regardless of the SOL in place in the state where the abuse took place, is a non-starter.

And I could very easily see a situation where the insurance companies, facing hundreds of billions in liability, would drop $500 million in defending against 50,000 cases. Of course, not all 50,000 will press it.

Edited July 1, 2021 by CynicalScouter

[CynicalScouter]

One more: the more and more I read this from the Insurance companies and what they let slip out about the draft RSA and plan(s), the more it looks like the plan is going to be:

1) BSA and the LCs are released, so a quasi-toggle plan (BSA and LCs)

2) BSA and the LCs plan on letting the insurance companies and COs twist in the wind. The COs are not going to be covered and the insurance companies are being put on the hook far more than they are comfortable with.

Now I am starting to wonder if the BSA lawyers are going to be smart or "smart" and wait until literally 5pm the Friday before the 4th of July holiday to file the RSA and all the assorted paperwork.

[Muttsy]

There is literally hundreds of billions of dollars in insurance. Chubb alone showed 175B in assets on its 2020 Annual financial statement. 
 

if you want real justice, you HAVE to make the carriers bleed. 
 

Trust me, there are multitudes of hungry trial lawyers who will press it if the client wants to fight on. And not years and years. That is is TCC and Coalition propaganda they spout because they aren’t sex abuse lawyers or even litigators. It’s like asking the dentist if you should get a heart transplant. 

[CynicalScouter]

6 minutes ago, Muttsy said:

if you want real justice, you HAVE to make the carriers bleed. 

Great. But what does that have to do with BSA? In other words, is there any advantage to NOT allowing BSA out of bankruptcy if the real focus on who needs to bleed is the insurance companies?

So, if there was a plan similar to what is on the table as a toggle plan that covers only BSA (or BSA and LCs) and leaves the question of insurance carrier liability to be determined later, what is the point of voting to object to such a plan?

[Muttsy]

13 minutes ago, CynicalScouter said:

So, if there was a plan similar to what is on the table as a toggle plan that covers only BSA (or BSA and LCs) and leaves the question of insurance carrier liability to be determined later, what is the point of voting to object to such a plan?

Personally, I don’t care one whit what happens to BSA. Under the soon to be fourth rendition of its plan, there is no money for survivors. It all gets gobbled up anyway, so why take bupkis for the privilege of putting the organization back in business with no real protections in place for kids?  The AG investigations will finish BSA off eventually. 
 

KOSNOFF got it right last year when he said BSA should do an orderly Ch 7 conversion with appointment of a Ch 7 trustee who will pursue the insurance and liquidate assets. At least that would stop the massive financial bleed. Fair market values could be ascertained and properties sold off. 
 

Separately the battle will move on to the LC’s and CO’s who are both additional insureds and in many cases have decades of their own insurance to be tapped. Individual Ch 11 bankruptcies with 500 - 5000 claims will be less complex to resolve. Kosnoff tweeted last year that this case has always been doomed to fail. 
 

Apparently no one wanted to hear that. 

[mrjohns2]

3 minutes ago, Muttsy said:

It all gets gobbled up anyway, so why take bupkis for the privilege of putting the organization back in business with no real protections in place for kids?

No real protection in place for Scouts? You must not understand how current YP works. Is it perfect? Obviously not. Is it improving all of the time? Yes, more rules, more strictly enforced. 

With the BSA taking out a $500M loan to go into the trust, how is that different than selling off the properties? The cash is there just as if they were sold off, no?

[johnsch322]

4 minutes ago, mrjohns2 said:

With the BSA taking out a $500M loan to go into the trust, how is that different than selling off the properties? The cash is there just as if they were sold off, no?

Forgive my ignorance but what loan are talking about?

[CynicalScouter]

BSA just filed an amended notice:

1) The July 20 hearing is still on but

2) Objections are now due July 13, not July 8.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/11fcc1f7-9cd2-4182-b350-f7698fab3b94_5463.pdf

[Bronco1821]

Wow, I could get whiplash with all of the back and forth in this case.  It's amazing to me that after 1.5 years of this case, there is so much still up in the air.  Looks like the only winners will be lawyers.  Sad. 

[CynicalScouter]

10 minutes ago, johnsch322 said:

Forgive my ignorance but what loan are talking about?

In order to get out of bankruptcy and survive, BSA is in effect giving a promissory note (the "BSA Global Resolution Note") worth $80 million into the trust which it will pay off over the course of the next several years.

In addition, BSA in order to have operating cash will borrow from the National Boy Scouts of America Foundation a loan valued at around $42 million, payable the day it leaves bankruptcy.

I'm not sure where the $500 million number came from; there is no $500 million loan that I am aware of.

 

Edited July 1, 2021 by CynicalScouter

[johnsch322]

1 minute ago, CynicalScouter said:

I'm not sure where the $500 million number came from.

The promissory note I know about.  $500M is more than BSA national is putting into the trust.

[CynicalScouter]

1 minute ago, johnsch322 said:

The promissory note I know about.  $500M is more than BSA national is putting into the trust.

I don't see anything in the documents filed to date about it, but that doesn't mean it isn't happening. The only thing I saw was the $80 million promissory note already listed.

[CynicalScouter]

Just FYI and as a frame of reference for if/when the RSA comes out:

The latest BSA plan was for BSA to pay in about $250 million as “BSA Settlement Trust Contribution”

page 19 of this: https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/b631204d-b4d8-46b7-8912-2b81c5090688_5372.pdf

Net Unrestricted Cash and Investments	$90,000,000
BSA Global Resolution Note (loan to be paid off by BSA over the next several years)	$80,000,000
Artwork	$59,000,000
Warehouse	$11,600,000
Oil & Gas interests	$7,600,000
Scouting University building	$1,962,000
	$250,162,000

 

Edited July 1, 2021 by CynicalScouter

[mrjohns2]

Sorry! $80M, not $500M. 
 

I would add the $42M to the $80M since they are basically saying they are going further in debt to make the other payments as well. That without the infusion of the $42M, they couldn’t operate. 

Edited July 1, 2021 by mrjohns2