Chapter 11 Announced - Part 5 - RSA Ruling

[CynicalScouter]

3 minutes ago, ThenNow said:

I just did that and the delusion ran deep. I was told from the jump there was no chance they wouldn’t be pressed to contribute or many would be in court soon after discharge. How does that happen, I mean seriously? If some/any were successfully sued prior to filing, that’s a pretty clear indication of liability or exposure at the least.

Because when this all started National was thinking a few hundred or many a few thousand cases or claims. Not 82,500 claims.

My council, to its credit, never believed it and warned from the start we'd have to pay SOMETHING. Not sure what or how much, but SOMETHING.

Other councils were sending around the "all funds will stay local; all is well!" emails.

There are a LOT of people who right now feel conned about that. But in National's (partial) defense, they were blindsided by the amount of claims.

[ThenNow]

3 minutes ago, CynicalScouter said:

Because when this all started National was thinking a few hundred or many a few thousand cases or claims. Not 82,500 claims.

Regardless, I know of no one on the victim claimant side who intended to give LCs a free pass to financial exoneration. None. That was clearly the intent. You’re saying National didn’t know that after who knows how many pre-filing talks with state attorneys? (I don’t think you are. It’s rhetorical.) I doubt it very much. Neither here nor there, at this point, but I respect and feel badly for the honest, earnest and committed Scouters who’ve had to take that dagger in the back. 

[PeterHopkins]

2 minutes ago, CynicalScouter said:

Other councils were sending around the "all funds will stay local; all is well!" emails.

That's right. When the BSA entered bankruptcy, there were posts indicating that local councils were not in harm's way financially and that Scouting, for the most part, would continue as normal but with higher registrations fees. FAQs released indicated none of the local council camps or other assets were at risk. We were led to believe that the BSA's bankruptcy filing would consolidate all claims using only assets of the National Council and its insurers, and that the restructuring plan would release local councils and chartered organizations from liability for claims.

That isn't exactly how they said it, but that was the tone they used.

I wondered from the start why a bankruptcy court would agree to release a local council or chartered organization that was paying nothing and wasn't a party to the proceeding. I thought that perhaps there were people far more clever than I working on this. It turns out that wasn't true.

[Eagle1993]

6 minutes ago, CynicalScouter said:

Other councils were sending around the "all funds will stay local; all is well!" emails.

 

Even now, councils need to be careful.  I would think their messaging should flow along the lines of ...

• Apology to claimants, statement along the lines that no amount of money could undo damage done.
• That the terms have not been finalized and there are still unknowns; however, based on the current plan:
• How much we are being asked to contribute.
• Did we agree to pay.
• How we plan to pay that contribution.
• What is the impact on scouting locally.
• How we are making sure we are doing everything possible to prevent the abuse from happening again.
• Again ... plans can change and this is the status as of today.

This shouldn't be a cheerful message. It should be somber.  It shouldn't lead into a recruiting/fundraising pitch.  

[David CO]

2 hours ago, CynicalScouter said:

Do you have particular names that are part of this conspiracy theory or is this just a general “they” and “them”?

Do they have names?  I always thought the national council typically used numbers to identify themselves, like SPECTRE in the James Bond novels.  

[ThenNow]

20 minutes ago, Eagle1993 said:

Even now, councils need to be careful.  I would think their messaging should flow along the lines of ...

If I were any anywhere near the Ad Hoc Committee of LCs, I would have sent that script almost verbatim, save for fleshing out few bullet points. Honestly, I was musing about that very thing last night. Forgive me, but from a messaging and PR standpoint, not to do so is a very boneheaded thing to do (not do). It also does not help this process. By putting their feet in their mouths, as some are, it adds to our concerns about their lack of engagement, sincerity and contributions. They need to know some of us measure every word they say. I’m happy to use stuff against them when I go to the Settlement Trustee, but good grief. 

Edited August 24, 2021 by ThenNow

[PeterHopkins]

9 minutes ago, ThenNow said:

Regardless, I know of no one on the victim claimant side who intended to give LCs a free pass to financial exoneration. None. That was clearly the intent. You’re saying National didn’t know that after who knows how many pre-filing talks with state attorneys?

I actually think there may have been some thought that this outcome was achievable. I think it's unlikely the messaging was intentionally misleading. What would have been the point of doing that? If they knew all along that this would affect local councils, kicking the can down the road and not saying so from the start only sets them up for what came later, which hasn't been well received, and that was completely predictable.

It's not possible to know what was inside anyone's head, but one factor is the number of claims, as @CynicalScouter mentioned. Underestimating that number could have resulted in folks projecting that they could reach equitable settlements out of the National Council's assets and insurance coverage.

Another factor is the timing, logistics and mechanics. Often, a creditor in a bankruptcy would rather get $x earlier instead of waiting for the possiblilty of $x+ at some unknown point in the future. The creditor might end up with the same amount or even less and wait longer to collect it.

The nature of these creditors differs greatly from those seen in most bankruptcies. They aren't vendors, lenders or employees hoping to recover as much of some fixed and determinable amount owed to them as they can. I think those who initially thought this could be made to go away by the end of 2020, failed to recognize the emotional element attached to the claims of the survivors. They didn't realize that this is not just about the money.

[CynicalScouter]

31 minutes ago, ThenNow said:

You’re saying National didn’t know that after who knows how many pre-filing talks with state attorneys?

There was one big mediation session right before the bankruptcy was filed. https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/799040_4.pdf

Quote

The strategic options that the BSA explored throughout 2019 included efforts to reach a settlement with a substantial number of abuse victims that could be implemented through a prearranged chapter 11 proceeding. Those efforts involved several meetings with attorneys representing many abuse victims, including a two-day mediation in early November 2019. The mediation was attended by a prepetition future claims representative and some of the BSA’s
insurers. Unfortunately, the mediation was unsuccessful. It became apparent that attorneys for abuse victims believed that certain Local Councils with significant abuse liabilities have significant assets that could be used to compensate victims. Further, it became clear that attorneys for abuse victims would only accept information about the nature and extent of the BSA’s available assets if provided through a court-supervised process. Accordingly, the BSA recognized in late 2019 that there were no meaningful prospects for a prearranged global resolution.

In February 2020 when the bankruptcy started, there were ~275 filed cases AND they though that MAYBE another 1500 claims where out there for a total of 1700.

Quote

The BSA believes the ongoing publicity surrounding such claims has encouraged many victims to come forward in advance of this filing, and has been made aware of approximately 1,400 additional claims of abuse. In sum, the BSA is aware of approximately 1,700 pending or asserted claims of abuse against itself or a Local Council organization. To the extent claims of
abuse have not been asserted, the BSA encourages individuals to submit proofs of such claims prior to the BSA’s requested bar date.

Here is the list (it was 285 at the time of filing)

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/802725_14.pdf

During the last hearing, I believe I heard that number is now up to 1200; this would seem to indicate 1228.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/cb5441eb-c31d-4917-979b-f9bfc64b4833_189.pdf

So BSA knew about 275-285 lawsuits against it and another 1500 claims (maybe) for a total of 1700.

MAYBE they figured a multiplier of 10x (17000 claims), not 48-50x (82,500).

 

Edited August 24, 2021 by CynicalScouter

[CynicalScouter]

3 minutes ago, ThenNow said:

By putting their feet in their mouths, as some are, it adds to our concerns about their lack of engagement, sincerity and contributions.

And by sending out as I noted 4 different messages:

1) NO data on how much is owed or how it will be paid for.

2) ALL data on how much is owned and how it will be paid for.

3) No data on how much, but data on how it will be paid for (we are selling the following camps...)

4) Data on how much, no data on how it will be paid for.

[ThenNow]

44 minutes ago, CynicalScouter said:

Those efforts involved several meetings with attorneys representing many abuse victims, including a two-day mediation in early November 2019. The mediation was attended by a prepetition future claims representative and some of the BSA’s
insurers. Unfortunately, the mediation was unsuccessful. It became apparent that attorneys for abuse victims believed that certain Local Councils with significant abuse liabilities have significant assets that could be used to compensate victims.

Precisely:

1) Several meetings, including a two-day mediation; and

2) “it became apparent that attorneys for abuse victims believed certain Local Councils with significant abuse liabilities have significant assets that could be used to compensate victims.”

They knew it was a specter, even if limited. Did they tell the open states they would need to cough up?

Edited August 24, 2021 by ThenNow

[ThenNow]

37 minutes ago, CynicalScouter said:

So BSA knew about 275-285 lawsuits against it and another 1500 claims (maybe) for a total of 1700.

MAYBE they figured a multiplier of 10x (17000 claims), not 48-50x (82,500).

Here are a few questions for the research team:

1) How many Catholic boys might one cipher were in a particular Diocese that went Chapter 11 over child sexual abuse claims;

2) Next, how many boys filed abuse claims in that case, maybe New Mexico;

3) Next, how many boys have been in Scouting since inception;

4) How many abused Scouts and abuser Scouters were identified in the released IVF; and 

5) How many of each might one speculate were purged before that; and

6) How many victims does the average child sexual abuse predator have in their period of active predation?

Now, someone mathy extrapolate the comparative numbers and do the calculations. I am very curious to see even some ballpark data.

Edited August 24, 2021 by ThenNow
Oops.

[PeterHopkins]

22 minutes ago, Eagle1993 said:

Even now, councils need to be careful.  I would think their messaging should flow along the lines of ...

• Apology to claimants, statement along the lines that no amount of money could undo damage done.
• That the terms have not been finalized and there are still unknowns; however, based on the current plan:
• How much we are being asked to contribute.
• Did we agree to pay.
• How we plan to pay that contribution.
• What is the impact on scouting locally.
• How we are making sure we are doing everything possible to prevent the abuse from happening again.
• Again ... plans can change and this is the status as of today.

This shouldn't be a cheerful message. It should be somber.  It shouldn't lead into a recruiting/fundraising pitch.  

The Key 3 Fireside Chat conducted by my council last week was somber in tone at the start. They were clear on the point that the abuse which took place can never be undone and no amount of money can erase it.

Nevertheless, my impression was that there was a total number the National Council wanted to hit to make a splash and encourage the survivors to support the plan. They plugged in a total contribution for all local councils in order to get there and then used a multi-factor formula to allocate it among them. They did mention that the financial health of the council was one of the factors, and that surprised me. Nevertheless, financially healthy councils that have relatively few claims and operate in states in which the statute of limitations is limited seem to be able to manage their share of the local council contribution, even if they are theoretically punished by the formula fo rbeing financially healthy.

Last week's presentation (on Tuesday) gave the impression that it is a near certainty that the council's three camps were not at risk. That means they anticipated approval of the RSA as it was, including cancelation of the agreement with The Hartford. The truth is that we are likely a lot further away from the finish line than they thought last Tuesday.

After discussing the bankruptcy, they moved on to popcorn sales and recruiting. Although I agree with the sentiment of @Eagle1993 that this is not appropriate, this message was being delivered to Key 3 members and no to the general public. All three of these things are necessarily intertwined, and the entirety of the address to the Key 3 was more about the survival of Scouting in the council than about compensation of survivors. They made the point that, although the assets to pay their local council share were available, the council would be much leaner after making the payment. The council is now serving fewer registered youth than at any time in its history. No one can ever really know the impact of individual factors that have caused drops in the number of youth:

- Radio ads about filing abuse claims that ran last year and were designed to reach more than 90% of adult males in the United States

- The departure of the LDS church (the only factor for which the direct impact can be measured)

- Media coverage leading up to the bankruptcy and since

- The actual filing of the bankruptcy petition, which erodes public confidence in the organization

- COVID-19 (I'm a Cubmaster, and I believe I lost 65% of my pack to this)

During the chat, they addressed rechartering issues concerning the United Methodist Church. They were reassuring that they believed they could iron out any issues. All units in the council are on calendar-year charters. However, there is probably a better than even chance that the RSA will be rejected by the creditors, and there will be no deal in place to protect chartered organizatons by the end of the year. That could cause another significnat loss of membership given statements the church has made.

[ThenNow]

33 minutes ago, PeterHopkins said:

I think those who initially thought this could be made to go away by the end of 2020, failed to recognize the emotional element attached to the claims of the survivors. They didn't realize that this is not just about the money.

Staying with the Catholic Church sexual abuse scandal comparison, not to mention USA Gymnastics and others, do they not follow the news? #metoo? Didn’t realize “this is not just about the money”? Say what?! That would be supremely boneheaded beyond compare.

[PeterHopkins]

@ThenNow I agree. Boneheaded would be a good way to describe it.

Again, I was speculating as to what the calculus might have been. I compared the BSA's bankruptcy with cases in which I have been involved professionally. I've never had one that had creditors other than employees, vendors, lenders and tax collectors. The character and objectives of the creditors here is vastly different, and that is the first thing that sticks out for me. I've seen lots of creditors take something less than they otherwise might have gotten just to bring the matter to a swift conclusion. Were there BSA people who believed (or were advised to believe) that such a factor could help pave the road to ending this quickly? I have no idea. I can only speculate. If they did, it was clearly boneheaded. If they didn't, the massaging from a year and a half ago makes no sense.

I don't know whether rates of abuse in the Catholic Church is a good predictor of abuse in the BSA. First, Catholic priests who perpetrated abuse were routinely reassigned to other parishes. Scouters who perpetrated abuse were made ineliible to continue volunteering. That single factor should have made abuse less common in Scouting than in the Catholic Church. Of course, Scouting may have provided more opportunities for abuse given that troops typically camp overnight monthly. But how do you measure it?

We, as a society, don't really now what percentage of boys suffer sexual abuse. Clearly, reported cases do not tell the whole story. But how do you estimate the unreported cases? Some studies have concluded that the rate at which boys are sexually abused may be as low as 5%.

The CDC estimates 16% of boys are sexually abused. That perccentage is widely quoted. If we assume it's reasonably accurate and apply it to the BSA's number of youth members estimated to still be living, I think we get a number much larger than 82,000. So, what does that mean? First, we can assume there are victims who did not file claims. That was probably taken into account at the start in estimating the number of claims there would be. Second, it could mean that abuse is less common in Scouting than in other walks of life. Given the distribution of the claimants, that appears to be true from 1990 forward.

I'm pretty sure there is no magic formula into which numbers could have been plugged that would have produced a reasonable estimate of the number of claims. But whatever model they used and whatever their reasons for using it were very far from reality. I don't think a number approaching 82,000 was even in their worst-case sceanrio projections.

[ThenNow]

18 minutes ago, PeterHopkins said:

I don't know whether rates of abuse in the Catholic Church is a good predictor of abuse in the BSA. First, Catholic priests who perpetrated abuse were routinely reassigned to other parishes. Scouters who perpetrated abuse were made ineliible to continue volunteering. That single factor should have made abuse less common in Scouting than in the Catholic Church. 

Yeah. Not what I was saying. I was asking if anyone could find/run numbers on the RCC cases. Even if priests moved, so did Scouter abusers, for a good number of years. I was just trying to isolate to find a  comparative number for the extrapolation. Imprecise, but I would find it interesting and possibly enlightening, regardless the outcome. I don’t presume to know how it would shake out.

18 minutes ago, PeterHopkins said:

Of course, Scouting may have provided more opportunities for abuse given that troops typically camp overnight monthly. But how do you measure it?

We had this tennis match eons ago on this forum and I did my best to make the case that Scouting is a far more broad, deep and sheltered field for  child sexual abuse. Raised Catholic to the extent that the only non-Catholic education I had was undergrad and a masters in my old age. I was also extremely involved in all manner of youth activities. Add up all the element of opportunity for abuse across and those activities and the fall well short of those available in historic Scouting. Others disagree, but I’m right. Take my word. I was first abused at my first Summer Camp a couple months after I signed up. 

18 minutes ago, PeterHopkins said:

The CDC estimates 16% of boys are sexually abused. That perccentage is widely quoted. If we assume it's reasonably accurate and apply it to the BSA's number of youth members estimated to still be living, I think we get a number much larger than 82,000.

Yup. My point exactly. Still, as you say, how do we know? We also know sexual abuse within families has always been highest. 

18 minutes ago, PeterHopkins said:

I don't think a number approaching 82,000 was even in their worst-case sceanrio projections.

Agreed. If they had asked CHILDUSA and other child advocacy organizations, they could have disabused them of that notion. Big time. Tim Kosnoff, even. 

Edited August 24, 2021 by ThenNow