Chapter 11 Announced - Part 5 - RSA Ruling

[CynicalScouter]

The NJ Methodists who were already told I believe not to recharter are being told again: don't recharter.

https://www.gnjumc.org/the-boy-scouts-of-america/

 

Quote

Statement on 8.17.21

The denomination continues to maintain a relationship with the BSA, and churches may continue to support scout troops. However, the ad hoc committee, established to represent United Methodist interests, and United Methodist leadership is disappointed and concerned that the BSA did not include its sponsoring organizations, charter groups in the agreement with the claimants. This leaves as many as 5,000 United Methodist U.S. congregations or more than 15% of U.S. congregations exposed to potential lawsuits by the claimants. Charter organizations were promised by the BSA to be covered by their insurance, but at this time, this does not appear to be the case. The ad hoc committee has advised that churches that support scouting units should (1) agree to extend an expiring charter through Dec. 31, rather than renew that charter, (2) replace an expiring charter with a usage/lease agreement that expires on Dec. 31, or (3) terminate an existing charter and replace it with a usage/lease agreement that expires on Dec. 31. All those options allow for time to see how the bankruptcy will impact the UM congregations.

 

Edited August 20, 2021 by CynicalScouter

[RememberSchiff]

19 hours ago, Eagle1993 said:

Topic includes RSA ruling (see below) and impact on bankruptcy.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/cbf4b5e3-c8a1-450e-aa7f-f65e20f40ee7_6084.pdf

Moved recent posts regarding proof of claims turned over to police to existing topic

 

[ThenNow]

5 minutes ago, RememberSchiff said:

Moved recent posts regarding proof of claims turned over to police to existing topic

I understand that decision, but for us as claimants, this issue of confidentiality, disclosure and access to our Proofs of Claims is directly related to and driven by the bankruptcy. This particular instance of reporting to law enforcement was not generated out of whole cloth or a recent, random occurrence, like the Shower Stall Creeper. This investigation is the direct result of a Proof of Claim filed by a victim who was likely unaware the case would be turned over to law enforcement. I’m not saying that is a bad thing, but we sort of deserve to be talking about this. It goes to the essence of BSA’s dealing with child sexual abuse (preferential “Oh, crap!” reporting for SilverWeasel?), the bait and switch (for some) as to anonymity/confidentiality and the major issue of what happens after the case to ensure investigations, prosecutions where possible and disclosure to the fullest extent allowable. That’s my reaction to you putting this in the basement with the sump pump, a rickety old card table and a single bulb dangling from the ceiling. (I’m playing with word pictures, not impugning you. You are my Spartacus and I will NEVER forget it!!)

[ThenNow]

By the by, limiting the topic/titling the thread around the RSA Ruling is a very tight leash unlike all the previous iterations. I still like, Episode V: When & How Much? but I have a built-in bias. 

[CynicalScouter]

By the way: for those wondering about a delay in this and BSA having said they'll run out of money by August, I got confirmed from a reliable source on my Council board who is high up with OA that BSA has now completely raided the OA fund to "keep the lights on". There's nothing much left in the National OA account.

Previously, BSA had said those funds were off limited/restricted, something TCC had contested.

So for those wondering at this point how BSA is functioning, it isn't. It's raiding its endowment, taking out operating loans, and raiding the OA and other internally restricted funds to keep the doors open.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/868466_1913.pdf
 

Quote

2. Order of the Arrow
28. On Exhibit B, the Debtors contend that $7,399,346 million of investments (the “OA Investments”) that they designate as Order of the Arrow (“OA”) constitute restricted
property that is unavailable to satisfy the Debtors’ obligations to their creditors.

29. Upon information and belief, the OA Investments relate to a Commingled Fund Sub-Fund that the Debtors contend are restricted and unavailable to creditors because they are earmarked for OA.
30. The Defendants have failed to provide adequate or definitive documentation (a) sourcing the OA Investments to specific donations, (b) supporting contentions that the OA Investments are subject to donor imposed restrictions, (c) of other restrictions or limitations that make the OA Investments unavailable to the Debtors’ creditors,, or (d) reflecting tracing showing that the restricted amounts thereof, if any, were not used, spent or transferred. Moreover, the Tort Claimants’ Committee is informed and believes that no such adequate or definitive documentation exists.

 

Edited August 20, 2021 by CynicalScouter

[Eagle1993]

20 minutes ago, ThenNow said:

By the by, limiting the topic/titling the thread around the RSA Ruling is a very tight leash unlike all the previous iterations. I still like, Episode V: When & How Much? but I have a built-in bias. 

Allowing multiple parallel conversations in a single thread gets very confusing.  The moderators will do our best to keep it tight to bankruptcy and spin off others as separate topics as needed.  

I simply hope in the end there are more Star Wars films than bankruptcy threads ... but the force is strong on this topic...

[CynicalScouter]

So this is cute and confirms that the bankruptcy lawyers are paying attention to social media (and possibly this site?)

A reddit post just made its way into the latest filing by the insurers. See page 90.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/ab03e093-d345-44e7-b022-cb07dd245278_6097.pdf

[ThenNow]

6 minutes ago, Eagle1993 said:

Allowing multiple parallel conversations in a single thread gets very confusing. 

My “Art of War” tactics have been discovered. On to chaos, I suppose...

 

[Eagle1993]

49 minutes ago, CynicalScouter said:

By the way: for those wondering about a delay in this and BSA having said they'll run out of money by August, I got confirmed from a reliable source on my Council board who is high up with OA that BSA has now completely raided the OA fund to "keep the lights on". There's nothing much left in the National OA account.

Previously, BSA had said those funds were off limited/restricted, something TCC had contested.

So for those wondering at this point how BSA is functioning, it isn't. It's raiding its endowment, taking out operating loans, and raiding the OA and other internally restricted funds to keep the doors open.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/868466_1913.pdf
 

 

Many of these investments could be roughly tied to the S&P 500.  When BSA went into bankruptcy, the S&P 500 was around $3,200.  Today it is $4,680 ... a growth of 46%.  That likely helped most councils & national BSA absorb the cost & settlement more easily.  I wonder if asset estimates are being updated with the stock market increase we have seen since early 2020.

Now ... if National is selling off their investments, they could run into trouble if this drags deep into 2022...

[ThenNow]

22 minutes ago, Eagle1993 said:

Many of these investments could be roughly tied to the S&P 500.  When BSA went into bankruptcy, the S&P 500 was around $3,200.  Today it is $4,680 ... a growth of 46%.  That likely helped most councils & national BSA absorb the cost & settlement more easily.

I know you’re doing calculations and speculating, but do you have any idea how this feels on “our side” of the table, as you wonder about it? “The market is doing great so it will be ‘easier’ for National and LCs to ‘absorb’ the cost of settlement...Huh. That didn’t hurt as much as I thought. Off we go...” I’m not seeing a market bump in my award making the pain of these 50 years easier to absorb. Sorry, but that’s how it feels. 

[Eagle1993]

1 minute ago, ThenNow said:

I know you’re doing calculations and speculating, but do you have any idea how this feels on “our side” of the table, as you wonder about it? “The market is doing great so it will be ‘easier’ for National and LCs to ‘absorb’ the cost of settlement...Huh. That didn’t hurt as much as I thought. Off we go...” I’m not seeing a market bump in my award making the pain of these 50 years easier to absorb. Sorry, but that’s how it feels. 

Actually ... that is my point.  With Cynical's comment about BSA surviving from their investments & OA fund, I am wondering if the lawyers representing victims have dynamic models to calculate ability to pay.  As a claimant, I would want my lawyers to watch for that.  How was that $600M calculated?  

To be fair ... National is feeling the pain.  I think we all see that.  I also think many councils feel deep cuts as well, especially NJ, NY, IL, California and a few other states.  It will be painful.

I think the tough message & discussion will be when all of the council details come out and some are getting off pretty light.  How will the TCC & claimant attorneys justify that.  We know why (SOLs) but it will be a tough message and vote for claimants in those councils.   Unfortunately, there isn't an easy way to cushion that discussion.

[ThenNow]

14 minutes ago, Eagle1993 said:

As a claimant, I would want my lawyers to watch for that.  How was that $600M calculated?  

To be fair ... National is feeling the pain.  I think we all see that.

Yes I do.

As great as it would be to know the general calculus to get to the number(s), my irritation and response were built on the Bay-Lakes Council example. I was washing away all else, looking only at the live claims and the Under the Gray Cloud claims compared to their asset base. And, as I keep harping, why can’t we see the competing Berkeley Research Group Dashboards? “Non-disclosure/NDA,” “redacted,” “under seal” and “mediation privilege” may end up banished from my vocabulary after this. They have 155 claims, 5 that could easily chew up their long-term investments if they were the sole source of recovery, which I know is a fiction, and a pile of assets. It feels diminishing, in the specific, not in general or as to the overall calculation methodology. If they do not have the benefit of the channeling injunction, what impact will the claims have on their financial condition? They ain’t looking at coming up with $3M, me thinks. I’m not asking for pain, I’m saying this looks like a mini Hartford deal: exposure incommensurate with the ticket to home base. Meh. I don’t like it.

[CynicalScouter]

1 minute ago, ThenNow said:

And, as I keep harping, why can’t we see the competing Berkeley Research Group Dashboards? “Non-disclosure/NDA,” “redacted,” “under seal” and “mediation privilege” may end up banished from my vocabulary after this.

What if anything is to stop the TCC from posting the Berkeley Research Group Dashboards?

[CynicalScouter]

I did this computation with Bay-Lakes, now I am doing it with Grand Canyon.

As previously noted, Grand Canyon is paying $7 million

Quote

$7 million represents:

• 73% Unrestricted Net Assets (based on balance sheet)
• 53% TOTAL NET ASSETS (based on balance sheet)
• $14,085 per claim on average ($7,000,000/497)
• 34-36% of property
• 42-44% of all unrestricted property

 

Grand Canyon is in Arizona and New Mexico. Arizona is an open state, New Mexico a Gray 1. There are 497 claims of which 475 are NOT time barred (which means they are probably almost all in AZ). I am just going to calculate as if all 497 claims are are in Arizona because there's no way to parse out where those are or are not.

Abuse Type	Count	Base Value	Maximum	Base Totals	Maximum Totals
A	166	$600,000	$2,700,000	$99,600,000	$448,200,000
B	120	$450,000	$2,025,000	$54,000,000	$243,000,000
C	80	$300,000	$1,350,000	$24,000,000	$108,000,000
D	104	$150,000	$675,000	$15,600,000	$70,200,000
E	6	$75,000	$337,500	$450,000	$2,025,000
F	8	$75,000	$337,500	$600,000	$2,700,000
Unknown/Unconfirmed	11	??	??
Missing	2	??	??
TOTALS				$194,250,000	$874,125,000

Thus Grand Canyon was looking at anywhere from $195 million to $874 million in liability. Again, insurance would cover some of this presumably. It is able to obtain the buy-out at $7 million.

 

Edited August 20, 2021 by CynicalScouter

[RandomScouter]

This just in from Greater Hudson Valley Council (before bankruptcy it was 2 councils - Hudson Valley and Westchester-Putnam):

"Greater Hudson Valley Council will contribute $6,367,834.84 to the Victims Trust Fund which will be used to compensate anyone that was victimized in the past. This non-negotiable number reflects the roughly 550+ cases from within our Council, in its various forms, going back to the 1950s. The majority of the cases took place prior to the 1990s. We take our obligation to the victims seriously as even a single case of abuse is one too many.

To fulfill this commitment, our Council Bankruptcy Taskforce has been working throughout the summer to consider all options available to us. Sadly, it does not appear that we will be able to come up with the necessary funds without selling one of our beloved camp properties."

 

(To the Moderators: I posted here rather than Bankruptcy Losses because it does not list the specific camp to be sold and because LC contribution needs to go somewhere... If you feel that contribution amounts belong elsewhere, okay.)