Chapter 11 Announced - Part 4 Revised Plan

[ThenNow]

13 minutes ago, Eagle1970 said:

Yes, if the story was really out there, the media would pick up "Boys who were molested in New York may receive up to $1 Billion dollars.  However, due to the Statute of Limitation in Mississippi, boys who endured the same abuse will receive somewhere around 10 cents".  At bare minimum, that would catch the attention of Legislators.  Whether they choose to jump in and do something to make this equitable is an entirely different story.

Yup. 100%.

Almost to a person, every one of my friends and family who know what I'm up to read the headlines and sent me some kind of "Yippee!" text or email. I started just cutting and pasting my stock response, since it was relatively long and involved. The two who didn't asked me if it was good news or a big TBD. They are my two sisters who know the most about the whole thing, from my perspective, and from all the articles and research I fling at them.

Edited July 7, 2021 by ThenNow

[ThenNow]

Um, the BSA's lead bankruptcy counsel is NOT attending the status conference?! I hope the "unavoidable conflict" is significant and, of course, not a calamity or tragedy. If it's work-related, that's stunning.

BSA counsel seems close to the "pass out the cigars and snifters" phase of his celebratory remarks. 

These attorneys on all sides love to say, "We still have wood to chop." I'd like to see the calluses from their frequent chopping of actual wood.

I am very grateful that John Lucas for the TCC didn't engage in 5+ minutes of self-congratulatory commentary. I needed to calm my belly. He acted honorably and appropriately. 

Edited July 7, 2021 by ThenNow

[CynicalScouter]

Sitting in on Zoom status conference:

Parties in support first. So far (in order), BSA, Ad Hoc Committee of Local Counsels, Coalition, TCC, FCR, UCC.

"Significant progress"

"Major agreement"

"Timeline" important

"Expeditiously"

"Get compensation to victims faster"

TCC did not say much but made "two primary points"

1. There's an agreement among all primary constituencies
2. We need to get the plan confirmation process rolling

FCR: "Resist calls for further delay"

Parties in opposition next.

Edited July 7, 2021 by CynicalScouter

[DavidLeeLambert]

21 hours ago, Muttsy said:

Why is there no mention of the DC theory?

Well, BSA did mention the DC revival in their First Day Motions Informational Brief [D.I. 4], filed on the first day of the case, page 5:

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/799040_4.pdf

"In January 2020, for example, a group of plaintiffs filed suit in the U.S. District Court for the District of Columbia alleging that the District’s recent revival-window legislation permits plaintiffs to bring previously time-barred claims, regardless of where the abuse occurred or where the plaintiff resides. [footnote: See Does 1-8 v. Boy Scouts of America, No. 20-00017 (RJL) (D.D.C. 2020).]"

But so far the theory is just that, a theory, untested in court, and from what I can see it wouldn't save every claim either. Here's what I believe is the relevant part of the statute:

https://code.dccouncil.us/dc/council/laws/22-311.html

 

"(a)Paragraph (11) is amended to read as follows:
'(11)for the recovery of damages arising out of sexual abuse that occurred while the victim was less than 35 years of age— the date the victim attains the age of 40 years, or 5 years from when the victim knew, or reasonably should have known, of any act constituting sexual abuse, whichever is later;'.
(b)A new paragraph (12) is added to read as follows:
'(12)for the recovery of damages arising out of sexual abuse that occurred while the victim was 35 years of age or older—5 years, or 5 years from when the victim knew, or reasonably should have known, of any act constituting sexual abuse, whichever is later.' "

 

So the only claimants it could help are those who were born on or after February 18th, 1980. The greatest peak of claims was roughly 1968 to 1974, and claims-per-year was consistently  decreasing throughout the '80s. There's the alternate clause "knew, or reasonably should have known", but since the LA Times published its "Inside the Boy Scouts' 'Perversion Files'" series in late 2012, that would be tough case to prove for any claimant who first filed in 2018 or later.

 

If a BSA lawsuit based on that DC law went to trial, I also imagine that the defendants would argue that BSA did not commit any specific acts that significantly contributed to any abuse in DC. For example, the IV Files were kept in New Jersey and then Texas, the respective BSA headquarters.

 

But that's probably one factor, among several, why even the "closed" state plaintiffs are being offered a factor of 1% to 10%, and why all claimants with substantially-complete, timely, and properly-signed forms are being offered the "Expedited Payment".

[CynicalScouter]

Sitting in on Zoom status conference:

Parties in opposition: Hartford, Balkin (sp?)/Balkin lawfirm on behalf of various victims and lawfirms of victims

Hartford: Is important to get BSA out of bankruptcy. Important for legitimate claimants. Also important for parties with substantial rights (insurers) to have due process. Filing substantial response that is going to oppose RSA. BSA wants declaratory relief and that requires adversary proceeding. Putting that aside, BSA is seeking a victim value and determination. "We will recite facts." BSA is going back on their word. BSA told us and told the court one thing (toggle plan was the backup) and is now trying to back out of the deal. Hartford has sought discovery and will seek discovery. The deposition and document requests Hartford has already made Hartford has been warned by BSA that they will rely entirely on mediation confidentiality to produce not much. Hartford wants disclosure hearing on a day SEPARATE from from the RSA date/hearing. Eric Green's appointment as Trustee is big issue; he was rejected previously as mediator. Green is now going to be the judge for BSA's liability "and then stick it to us." Everything is meant to "stick it to the insurers." BSA is seeking insurance coverage determinations and obligations as part of this plan without giving the insurance companies a chance. TCC lawyers and coalition lawyers are out there telling media plan binds insurance companies. Hartford wants discovery.

Balkin (sp?)/Balkin lawfirm on behalf of various victims and lawfirms of victims: Been litigating sexual abuse claims for years, San Diego Diocese, etc. 50 lawfirms have looked at these documents and we have serious concerns and objections. Serious issues with channelling injunction where the subject matter jurisdciton over LCs, are LCs making substantial contributions, can bankruptcy court enforce claims that are not enforceable (due to SoL), should claimants without valid claims in state courts get to vote on this plan? Whether/why LC contributions are only 1/3 of unrestricted assets. Are insurance liabilities of non-debtor third parties capped for insurance companies at the levels the LCs have paid? What is happening with future claims? The FCR is only the FCR for under 18 and repressed memories, but California allows for delayed discovery claims. What about future claims against the LCs? Is this a "litigated plan"? Is this bankruptcy plan a  judgement enforceable against the insurers? TCC is out there telling people it is. Law firms are unable to tell claimants/clients how much they are really going to be getting. Just want to alert court to what is coming. We need time.

Rosenthal/AIG companies: Insurers don't think this is success. This deal is half a loaf and it will not result in the end of the case or survivors getting money soon. We were excluded for the most part. PBS news quote from yesterday: the plan was to go after insurance next. Debtors only giving us 7-8 days for insurers to respond. This is not an insurance neutral plan. These are absolutely essential. Judge is being asked to make liability adjudications. Judge did not know what insurance neutrality meant. You cannot confirm such a plan. Claimants cut a deal with the debtor and let the the claimants take over the plan/take over the case. Many/most/all documents are going to be held by BSA to be mediation privileged. Two week delay is reasonable.

Judge: WRT insurance neutrality, Rosenthal, what issues of fact need to be developed vs. a position of law? That the judge simply cannot make the findings? Rosenthal response: most are matters of law, not fact. What did the debtors consider to abandon the toggle plan? Many of the issues related to insurance neutrality are issues of law.

Scavani (sp?) for Century: There were limits under these insurance policies that made BSA have to pay. The RSA changes it, so that the insurance companies have to pay EVERY dollar. Changes insurance policies relationship so that BSA gets to walk away and requires the insurance companies have to fund the defense of the BSA. Focus on scheduling, joins everything Rosenthal said. Good process results in good decisions. Century got the plan 20 minutes before midnight before 4th of July holiday. Excluded from all meetings involving the TCC and the BSA and the drafting of the TDP. The message was clear from the TCC and BSA and the mediation: the insurance companies were able to participate in but were excluded at every step. BSA has turned this process over to the TCC regarding what claims are allowed is off the rails. No one had a counter-interest. Not trying to poison the well, but... They are seeking findings that the negotiation was in good faith and all mediation parties included, etc. Some of these findings in the RSA are designed to prejudice the insurance companies and prevent them from later claiming the RSA and plan was simply collusion between the BSA and the TCC. We need discovery. Nothing about the merits of the claims. ALL claimants get paid something. Even if SoLs are in place are getting paid $3500. In essence, everyone is paid to vote. No vetting of the claims. Still asking for discovery as to the claims. There was no effort to work with insurance companies, the assumption is that every claim is going to be held valid and approved. It drops all protections for the COs/sponsor organizations. All the COs and sponsor organizations are going to be hit with lawsuits this fall. Some of the sponsors are on the call and will address this issue. Abused in Scouting and social media. Kosnoff has said he objects to the RSA. Kosnoff claims to speak with the victims, but Rosenoff (sp?) signing on RSA. Who exactly is it that control the votes and can therefore sign the RSA? Also, plan calls for big payments to TCC professionals. TCC wants a finding that the mediation was OK, but won't disclose what happened behind closed doors.

Going to make a new post for the next set of objectors.

[CynicalScouter]

Sitting in on Zoom status conference:

Parties in opposition continued: LDS

Goldberg for LDS: Join to adjourn hearings. The RSA leaves out the COs. The LDS is one of the COs. There are over 41,000 COs. Top 20 COs include Methodist Church, Catholic Church, LDS, etc. The plan does not have the support of ANY COs and NONE have gotten advance notice. Only a few COs have been mediation parties. "Highly prejudicial" to COs. COs will never recover anything on indemnity claims or if they did it would be years down the road. The plan also strips CO property rights. It prohibits COs from insurance rights to seek out against LCs and others. These are extraordinary terms without precedent. The RSA and new Plan and its removal of the toggle plan impacts COs and the toggle plan would have been better for COs. More time needed for COs. Many of the tens of thousands of COs are starting to wake up as to what this plan is doing to them.

Ryan for United Methodist and Roman Catholic Ad Hoc Committees: The Roman Catholic Ad Hoc committee was just formed, the Methodists have been since the start. The dioceses/archdioceses are just now come onboard. "The future of scouting relies on our support." They are also creditors that have indemnity claims against BSA and the LCs. The plan strips all the property rights and the court's jurisdiction to do this. This plan prejudices the COs. It is a plan designed to pressure COs into accepting TCC claims. Every CO will have to decide: how do we continue to do business with BSA with the way BSA plans to treat COs? It will make the decision self-fulfilling. COs want to be part of the solution. COs had sat back and let the negotiations happen, but this is not going to jam the COs. What should happen is a pause to see if COs want to be incorporated and go forward with scouting. There are 40,000 COs, none of them are getting due process and the whole process is violating local rules. It will threaten the future of Boy Scouts.

Linder for BSA back up

[CynicalScouter]

Linder for BSA:

There is opposition to the RSA motion on the timeline and the disclosure timeline. Response to Anker/Hartford, sounds like Hartford already has its brief written. We don't think Hartford needs to be an adversary proceeding.

Judge: Debtor wants me to make in RSA a finding that Hartford wants discovery on. This isn't a purely legal issue. So, what about need to take discovery? Linder: Discovery is needed, but it can be done quickly and narrowly.

More Linder: Insurance companies were at the mediation in a meaningful way. No one was shut out of the mediation.

Judge: "I am not going to be able to resolve that dispute." "I think there has been a significant achievement." "But it is also clear not everyone was involved." "Move on."

Linder: BSA did not just turn over the pen to the TCC. This was collaborative.

As for COs: appreciate the concerns, just say that w/r/t LDS is unique in that LDS has put indirect abuse claim (garbled)? But these are all confirmation issues. As for other COs, we do value them. Lifeblood of scouting. We are happy to engage with this.

Judge: "That's how I read it" that it abridged the COs rights and subordinated their claims. Are they wrong?

Linder: He is not wrong.

Judge: I noted the same issues expressed (by the COs). I just note that. You speak as of LDS mischaraterised the plan, but I don't think he did.

Linder: RSA is a "gating" matter, goes before plan.

Judge issued rulings:

1. RSA will be heard first and appropriately briefed. RSA scheduled for July 29-30 (may not take 2 days).
2. Also like to hear 29-30, response to Rule 2019 motion that insurers brought vis-a-vis Abused in Scouting. Mr. Wilks or whoever represents Mr. Kosnoff needs to be noticed. Response on Rule 2019 to address what was brief but also whether the numerous letters received from their clients is the basis to require a Rule 2019 statement to be filed. Mr. Wilks: We are here and will be prepared. Most of the letters appear to be from clients of Abused in Scouting.
3. Briefing on disclosure, some issues sound more like confirmation issues, but parties should have meaningful chance to weigh in on disclosure statement and because RSA is gating, so disclosure hearing has to be delayed to August 17.

BSA now wants to do RSA and disclosure July 29-30, but judge won't budge. October/November are full.

Talk about doing confirmation discovery NOW, prior to even disclosure statements.

"We'll move some things".

Judge: I think the RSA, whether I approve or don't, the agreement is significant achievement. Hope the delay allows for discovery and comprehensively brief two issues listed above. Hope time is also bring others into fold or to continue discussions. Consensus plan is preferable. Most if not all issues raised today are not easy ones. Consensus plan is preferable. Survivors get paid sooner. BSA emerges sooner. More definitive resolution. Will note: non-monetary provisions that were "very appropriate" to address safe scouting and how BSA will ensure past abuse does not continue into future. As I read survivor letters, that is an aspect often in letters and is compelling.

Nason for Ad Hoc Committee of LCs: Agree that Chartered Partners are essential. They will work on CO issues. Offer to Chartered Partners, Ad Hoc committee happy to engage.

US Trustee: Request for debtors to send out notices. BSA: Yes, we will.

[CynicalScouter]

So, big take aways:

1) The COs are pissed, no other way to put it, they are pissed that they are getting thrown under the bus. The fact that the Ad Hoc Local Committee and BSA went out of their way to try to mend fences right there in the middle of the hearing tells you how big a deal this is.

2) Kosnoff and AIS and Coalition are now going under the microscope. The Rule 2019 motion, if approved, would require them to disclose all their creditors and what the exact precise relationship(s) are see page 26-27 of this https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/872699_2030.pdf

3) There's no way BSA emerges from bankruptcy in time for fall recruiting. Even if by some miracle the August 17 hearing results in a disclosure statement that can go to a vote, it will take 90-120 days to vote on the disclosure statement and confirm that is November 15-December 15 before BSA emerges.

4) The RSA is going to be a much bigger fight that people imagined.

5) This doesn't end with the disclosure. The judge has said at least twice that these arguments are for the confirmation hearing. That means EVEN IF the plan is voted approved, she's still not ruling yet whether or not certain things are legal, especially I take it with respect to the insurance company concerns.

And remember folks: BSA said it was out of cash in August.

Edited July 7, 2021 by CynicalScouter

[CynicalScouter]

What the insurance companies want from Kosnoff and the Coalition (the Rule 2019 motion).

2. Abused in Scouting and Kosnoff Law PLLC must separately produce the following information pursuant to Rule 2019:

A. A list of the names and addresses of all creditors (including creditors for whom the filing counsel is acting as co-counsel) represented by Abused in Scouting and Kosnoff Law PLLC. The list should indicate whether each creditor has opted in to be part of the Coalition

B. A complete copy of each form of agreements authorizing Abused in Scouting and Kosnoff Law PLLC/Tim Kosnoff to act on behalf of a creditor in this case and their representation of multiple parties.

C. A list and explanation of any co-counsel, consultant, or fee-sharing relationships and arrangements in connection with this bankruptcy case or claims against any of the Debtors, and attachment of copies of any documents that were signed in conjunction with creating that relationship or arrangement.

D. A list of the persons or entities with an equity interest in the claims of any creditor represented by Abused in Scouting and Kosnoff Law PLLC/Tim Kosnoff other than the claimant.

E.All other information and disclosures required by Fed. R. Bankr. P. 2019.

3. The Coalition must produce the following information pursuant to Rule 2019:

A. A list of the names and addresses of all creditors represented by the Coalition, including the law firm that represents each creditor. The list should indicate whether each creditor represented by Abused in Scouting and/or Kosnoff Law PLLC/Tim Kosnoff has opted in to be part of the Coalition.

B. A list of the persons or entities with an equity interest in the claims of any creditor represented by the Coalition other than the claimant.

C. All other information and disclosures required by Fed. R. Bankr. P. 2019.

 

[Eagle1993]

Kosnoff will try and drag this out if possible.  Could he appeal the discovery ruling?  

[CynicalScouter]

8 minutes ago, Eagle1993 said:

Could he appeal the discovery ruling?  

If he is forced to disclose? Sure. But the question would be whether or not that would delay proceedings. It may or may not.

[ThenNow]

38 minutes ago, CynicalScouter said:

There's no way BSA emerges from bankruptcy in time for fall recruiting. Even if by some miracle the August 17 hearing results in a disclosure statement that can go to a vote, it will take 90-120 days to vote on the disclosure statement and confirm that is November 15-December 15 before BSA emerges.

Please refer to my post that begins, "I drone on..."

38 minutes ago, CynicalScouter said:

And remember folks: BSA said it was out of cash in August.

See above. 

[CynicalScouter]

1 minute ago, ThenNow said:

Please refer to my post that begins, "I drone on..."

See above. 

Yes, BSA's play games with victims: oh we just have to rush this plan through because we are running out of cash...but maybe not.

[elitts]

 

5 hours ago, ThenNow said:

I'm sorry, but again, you don't get it and you won't convince claimants by repeating the technical details. Being right is not the same as it feeling right and resting comfortably on one's fragile psyche. I mean no offense, but you simply can't understand or reason it away with legal precision. Sorry.

This is one of those areas where it's hard (for me at least) to know how to approach the issue.  Whenever I see someone making impassioned but incorrect statements I always have to argue with myself about correcting them.  I'm always trying to decide "does this person actually want correct information or do they just want a chance to express their feelings?".  On top of that, my second thought is usually, "regardless of whether or not the commenter wants/needs to be corrected, would leaving it alone result in other people getting incorrect information, and would that matter?"

So sometimes I respond, and sometimes I hold my tongue. (or fingers)  Frankly I think sometimes my decision depends on how argumentative I'm feeling in general.

[ThenNow]

3 minutes ago, CynicalScouter said:

Yes, BSA's play games with victims: oh we just have to rush this plan through because we are running out of cash...but maybe not.

I'm eager to read any communications Scouters and represented claimants receive recapping the status conference. Anyone who is willing to provide such will receive a limited edition commemorative "More Wood to Chop" certificate, suitable for framing.