Chapter 11 Announced - Part 6 - Plan 5.0/TCC Plan TBD

[CynicalScouter]

So, I want to come back to something people have raised and that is the value and assets of LCs.

There are two main issues. The first is that the properties are undervalued. The second is that what the LCs insist are "restricted" really are not.

The first issue came up in the hearing last week and has been discussed here, namely, that "book value" or real estate appraised value of these properties is absurdly low and that what needs to happen is appraisals.

Only, as Stang was somewhat forced to admit, the vast majority of properties HAVE been appraised.

There were two main entities that did the appraisals

1. CBRE, hired by the TCC
2. JLL, hired by BSA
3. Keen, hired by ???

There are 728 properties held by 250 or so councils (a few councils have no property such as Colonial Virginia, Far East, etc.)

Of these 728

CBRE did appraisals on over 500. JLL on around 350. In some cases, both CBRE and JLL both did appraisals.

I don't really see the argument here that was previously made that somehow the LCs have grossly undervalued the properties. By my count, per the latest filing, only around 10 properties are council-valued.

I just don't see where the TCC is going to be able to prove that the LCs have tons of property valued at another billion dollars is coming from.

Now, the issue of "restricted". I suspect what WILL be the heart of the TCC plan is that these LCs don't need as much money has they are sitting on, they can survive without it, and that some of these "Restricted" properties are not all that "restricted" and therefore subject to immediate sale.

So the councils that are walking away with only giving 10-20% OR LESS in total assets are in for a rude awakening.

[vol_scouter]

From the information that I have seen, my local council would be hard pressed to sell properties for the appraised value.   People who have given money to the council for specific reasons will be very upset that their donations were classified by outside agents and could be taken.   
 

The amount of money that our council is to pay will definitely be painful and will require years to replace.  The contributions that Stang is talking about will likely result the failure of many councils as it is not realistic.  
 

As many have noted, the BSA and local councils simply do not have the money that Stang and others are demanding.  It was never going to be able to compensate victims to the amounts that have occurred in other cases.   
 

The BSA must have a viable five year business plan.   Can it make that plan if the local councils are being sued or pushed to insolvency by crippling settlements?

[skeptic]

While there is no absolute way of proving many considerations on Council held properties, the truth is that most were given to councils with verbal stipulations for use by Scouts and the expectation that is what would happen going forward.  Some, more careful donors, understanding greed and lawyers, specifically wrote those stipulations into their donations.  Most though were the "old fashioned" hand shake agreement that today's legal system often chooses to ignore.  That being said, IF certain camps and properties were put on the market, there likely will then be more legal ramblings from families, or even the original donors.  Also, many of the properties border on federal lands or even are surrounded by them, as is our camp.  Part of our camp has leased FS land for campsites, while much of it is not viable for much other than camping and hiking, as the location and expense to develop would be huge.  So, those likely are major considerations.  Of course, some states, like ours, California is also under the constant eye of the environmentalists, who we mostly get along with well, but could jump in should property be offered up, especially under these specific circumstances.  

[CynicalScouter]

57 minutes ago, vol_scouter said:

As many have noted, the BSA and local councils simply do not have the money that Stang and others are demanding.  

Here is the deal with the LCs. They want to avoid their own bankruptcies? Then they need to pay and pay a LOT more than the pittance they are offering.

Stang’s position is to leave LCs with

1) two years operating expenses in savings and cash

2) those camps that are actually being utilized. There are a LOT of camps that remain for nostalgia of a time when councils had 2-10x as many scouts as they do now.

And that is it. If the council doesn’t want the deal, fine. They can then wait for the inevitable lawsuits (every single council has live pending sexual abuse claims inside the statutes of limitations) and we’ll be back here in 6 months or a year to talk about how XYZ Council had to file their own bankruptcy.

When we run the data and find dozens upon dozens of councils offer 10% or LESS of assets, they don’t get to come crying poverty.  When most councils are offering 14.77% of total assets or LESS, they do not get to come crying poverty.

And the victims are well within their rights to say no to any such deal.

Edited September 26, 2021 by CynicalScouter

[johnsch322]

11 minutes ago, CynicalScouter said:

Here is the deal with the LCs. They want to avoid their own bankruptcies? Then they need to pay and pay a LOT more than the pittance they are offering.

Stang’s position is to leave LCs with

1) two years operating expenses in savings and cash

2) those camps that are actually being utilized. There are a LOT of camps that remain for nostalgia of a time when councils had 2-10x as many scouts as they do now.

And that is it. If the council doesn’t want the deal, fine. They can then wait for the inevitable lawsuits (every single council has live pending sexual abuse claims inside the statutes of limitations) and we’ll be back here in 6 months or a year to talk about how XYZ Council had to file their own bankruptcy.

When we run the data and find dozens upon dozens of councils offer 10% or LESS of assets, they don’t get to come crying poverty.  When most councils are offering 14.77% of total assets or LESS, they do not get to come crying poverty.

And the victims are well within their rights to say no to any such deal.

Which brings me back to Los Padres Council. 17 million in assets offered up 10% or 1.7. They are in an open state and I am sure that they are just hoping to get this RSA passed with channeling for them. If not the sky is the limit for their liability. As of now I am inclined to vote no. 

[skeptic]

"the sky is the limit for their liability".  This is the problem with this and similar law suits.  It leads to drawn out court cases and often ruination of not only the entity sued, but very often peripheral groups or people.  And, no one has yet explained to me how you put "a value or price" on emotional and psycological damage, since it will vary from personality to personality, and often is made worse by the very law suit that is being placed.  Worse, in most cases, it is not the actual perpetrator that is being affected, but groups and people that had little or no control, or made poor decisions based on what seemed logic or reason.  We come back again as to why insurance policies stipulate amounts for physical damages, wheter property or human.  It is always going to not satify most claimants, and the litigation adds even more due to no limits on that cost either.  JMHO of course.  So please do not make comments about me not caring.  

 

[johnsch322]

4 minutes ago, skeptic said:

"the sky is the limit for their liability".  This is the problem with this and similar law suits.  It leads to drawn out court cases and often ruination of not only the entity sued, but very often peripheral groups or people.  And, no one has yet explained to me how you put "a value or price" on emotional and psycological damage, since it will vary from personality to personality, and often is made worse by the very law suit that is being placed.  Worse, in most cases, it is not the actual perpetrator that is being affected, but groups and people that had little or no control, or made poor decisions based on what seemed logic or reason.  We come back again as to why insurance policies stipulate amounts for physical damages, wheter property or human.  It is always going to not satify most claimants, and the litigation adds even more due to no limits on that cost either.  JMHO of course.  So please do not make comments about me not caring.  

 

It’s not that I feel you don’t care it’s more that your caring is more leaning away from victims and more to peripherals. 
As far as value for the damage caused it is well laid out in law and determined by a judge or jury if a state court trial is pursued. If my case went before a jury trial it might bring 10 to 20 million dollars or not. That is for a jury or judge to decide.

As for the entity’s that should have protected me well they didn’t. They showed poor judgement, lack of process and in my honest opinion lack of caring. 
 

[fred8033]

2 hours ago, CynicalScouter said:

So the councils that are walking away with only giving 10-20% OR LESS in total assets are in for a rude awakening.

This seems like the sausage analogy where things can be really ugly to get a result.  Many LCs will walk away from the agreement if required to surrender the majority of their assets.  Many LCs can use SOL protection.  Many LCs might have already settled on individual claims.  Many might do better with their own bankruptcy in their own state.  In any case, LCs might do better simply because they continued to control the funds now.  

If suspect if you ask LCs to give up 50% or 75% or more of their assets, most LCs that can will walk.

[fred8033]

1 hour ago, vol_scouter said:

The BSA must have a viable five year business plan.   Can it make that plan if the local councils are being sued or pushed to insolvency by crippling settlements?

Yes, BSA could establish a viable five year business plan.  BSA as a business is an interesting beast.  Most of the value are intellectual products (badges, ranks, lessons, structure).  Some value is in Philmont and the high adventure camps.  From what I see, BSA could drastically scale down and then slowly over time re-establish itself.  

BSA is not like a manufacturing company where raw material, manufacturing, product design, etc could risk it not competing in the future.  

I really believe BSA has a strong course back.

As for local councils being sued into insolvency ... There are hundreds of councils.   Less than half will probably out right fail.  Those councils that do fail can be replaced quickly with new franchies.  

If BSA can shed debt / liability, it has an excellent chance of being a viable business.  

[CynicalScouter]

30 minutes ago, skeptic said:

And, no one has yet explained to me how you put "a value or price" on emotional and psycological damage, since it will vary from personality to personality, and often is made worse by the very law suit that is being placed. 

Emotional distress damages are calculated every day in courts all around the nation. It is not a new concept. The tort of "intentional infliction of emotional distress" goes back at least 7 centuries (I de S et ux v. W de S, Y.B. 22 Edw. III, f. 99, pl. 60 (1348).) and is entirely a question of what EMOTIONAL damage a person suffers, not physical.

In that instance, a drunk swung or threw an ax at the wife of the tavern owner when told the bar was closed. By sheer dumb luck or because he was too drunk to aim, she wasn't killed in fact not one PHYSICAL harm was done her. Yet the court held in favor of emotional damage (payable to the husband because back in 1348 wives could not sue in their own right, but that's another story for another day) for in effect scaring her half to death.

In fact, that's were the concept of ASSAULT came from. BATTERY was actual physical damage. ASSAULT was purely threatening and emotional. Thus when we talk about sexual ASSAULT in the civil or criminal context, you do NOT need to prove PHYSICAL harm.

30 minutes ago, skeptic said:

We come back again as to why insurance policies stipulate amounts for physical damages, wheter property or human.

Some do, but most simply talk about "personal injury" that includes EMOTIONAL. Don't like it? Wind the clock back 750 years. Simply because it is hard to value or quantify emotional damage does NOT mean it is impossible to do so. NOR does it follow that a person sexually abused  has no "damages". Outside of certain forced acts, there is no PHYSICAL damage involved in many sexual abuse cases. But emotional? Absolutely.

Edited September 26, 2021 by CynicalScouter

[johnsch322]

This is a bankruptcy it is about business. The only caring can come from individuals and I am amazed at how many don’t care about victims. If the RSA is passed as is the only ones who will be short changed will be the survivors who’s abuse happened in open states or are within the time limits to sue. Under this version the LC’s, CO’s and insurance companies are coming up smelling like roses. If this becomes a cram down/BSA only bankruptcy then there will be survivors in closed states that will lose in the current time frame. As more states open up those from closed states will be able to file in state court.

If an RSA is not put forward with much more from LC’s, CO’s, and insurance companies there will be a big campaign waged by numerous attorneys against the plan and one of the most vocal will be Tim Kosnoff. Just look at how many claimants wrote letters to the judge and how much easier it will be for them to mark no on the voting ballot. 

[SiouxRanger]

9 hours ago, RememberSchiff said:

Seems problematic for the court, where corporations fade and re-incorporate under the same person but not necessarily at the same location.

In my state, a corporation simply cannot simply cease operations, wind down the business, and dissolve.  And run and hide, escape, and get away unscathed.  Corporate liability continues for 5 years, I think after dissolution, remaining liable and responsible to respond to subpoenas (legal process), litigation, etc. .

[Eagle1993]

All ... some of the discussions here drifted from the original topic.  So, if it seemed best to move those to the other thread linked above.  If the posts were more closely linked to this specific bankruptcy case, I kept it here.  

 

[CynicalScouter]

11 hours ago, SiouxRanger said:

In my state, a corporation simply cannot simply cease operations, wind down the business, and dissolve.  And run and hide, escape, and get away unscathed.  Corporate liability continues for 5 years, I think after dissolution, remaining liable and responsible to respond to subpoenas (legal process), litigation, etc. .

Right, so from a legal standpoint if XYZ Corp was subpoenaed but XYZ Corp dissolved in 2020, the subpoena is still live and valid against the "custodian of records" for XYZ Corp. Depending on the state, you have a statutory obligation to hold on to the records for a set number of years or forever.

For example, here's a run down on Virginia https://www.vscpa.com/article/record-retention-small-businesses

Now, that doesn't mean every LLC will do so, but the point is that the court (or attorney based on a court order) will subpoena XYZ Corp and if they don't respond, or respond with "we shredded it" that can in the civil context have negative connotations.

[Eagle1970]

1 hour ago, Eagle1993 said:

All ... some of the discussions here drifted from the original topic.  So, if it seemed best to move those to the other thread linked above.  If the posts were more closely linked to this specific bankruptcy case, I kept it here.  

 

With all due appreciation to the host and moderators, I rarely even look at the other thread.  One is enough for me.  I'm not even sure I could find it.  May I suggest when items are moved you indicate so with a link?