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

[CynicalScouter]

31 minutes ago, CynicalScouter said:

That of course leaves the LCs completely up creeks without paddles and will immediately/within a month lead to a dozen LCs filing their own bankruptcies.

So, if Plan 5.5. fails and the judge orders a BSA-only cramdown, which councils are most likely to go into bankruptcy first?

Hard to say, but what we CAN say is how many councils as of August 17 are named defendants in lawsuits.

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

All 17 councils in NY are facing, at minimum, 20+ lawsuits. Greater New York has hundreds. You can easily assume all 17 are in Chapter 11 the day after a BSA-only cramdown.

Ditto the 22 councils in California, even the relatively small Western Los Angeles (4 lawsuits).

Aloha Council's gone too, not interestingly because of Hawaii but because of the 150+ Guam claims.

Edited September 29, 2021 by CynicalScouter

[qwazse]

1 hour ago, Eagle1970 said:

That could make $3500 look good.  This is a sad situation.  I feel that the hype in signing up claimants was negligent to an extreme.  The talk of equitable compensation and equal treatment regarding SoL only exacerbated it.  IF these numbers turn out to be close to accurate, I'm sure most of us would not have bothered.

If one is to assume that the rate of victimization in scouting is on par with what has been reported in general population(s), the majority of victims did not bother. Either they saw the "talk of equitable compensation" for the large compromise that it would be, solicitations never reached them, or monetary compensation at the expense of today's scouts was never part of their formula for healing.

[CynicalScouter]

BSA now has "Amended Modified" Fifth Plan

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/dc37de84-9011-43a7-9594-ccc67f679861_6416.pdf

This is the red line version

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/35c0918c-f981-48da-9dbc-48b0cf9f111b_6417.pdf

I see some additions of note

Quote

For the avoidance of doubt, no Claim alleging Abuse shall be an “Abuse Claim” against a Contributing Chartered Organization or a Participating Chartered Organization if such Claim is wholly unrelated to Scouting.

They are STILL insisting on ALL claimants voting as a block and NOT dividing $3500 vs. non-$3500. See page 48. Although they did add the language back in about the election being on the ballot, so I guess this is getting pushed off to confirmation.

Edited September 29, 2021 by CynicalScouter

[fred8033]

1 hour ago, ThenNow said:

I said this once before so, for those who recall, please forgive the echo. I heard with my own two ears an LC talking about major donors holding off on giving until the settlement trust is funding and BSA emerges post-pupation. Stated reason? "I don't want to just give more money to the _____ity _____ lawyers." I know. I know. They're drawing down on reserves and what not, but I can distinctly hear Obi-Wan saying, "These aren't the droids you're looking for." 

I'd 100% expect this.  This seems correct.  Zero ethical issue. 

Perhaps I'm misunderstanding the nature of business accounting during huge tort cases.  It a real ethical issue to collect new donations as normal to pay past liabilities as if all is good.  FOS is about sending a kid to camp; to help families afford scouting.  That's the pitch.  If most of the money is to pay yet-to-be-understood liabilities of 30/40/50 years ago, you need to tell those families.  Same with the big donor.  ... KEY POINT ... People donate to make the future better.  People don't donate to pay past bills.   

QUESTION - If an LC received a major donation before the settlement is reached (let's say $10m), that $10m "could" be factored into LC assets during negotiations.  Is it correct that the $10m; meant to target future good; could  increase the settlement size of the past liability and effectively reduce amount available for future good?

I'd really like to understand non-profits and tort cases.  Non-profits are often funded on donations.  If a tort case takes 18 months to reach a settlement, the non-profit is best served to operate on savings; effectively reducing the available cash.  Tort cases are a business equation.  If the settlement is reached on day 1, you could get 20% of 100% of the assets.  If negotiations take 300 days, then the settlement is based on much lower assets.  

Very different than a manufacturing company going thru bankruptcy.  If a manufacturing company did this, they'd have to stop making and selling their product.  That effectively stops the business and removes it as an on-going concern.   That changes the problem to liquidation.  ...  Non-profits can keep executing against savings doing the exact same work they've always done.  

Scouting has always been funded mostly by donations.  LCs assets are a buffering cash-flow tool.  New donations effectively re-build savings for tomorrow.   ... I see zero reason to re-build savings for tomorrow if those new donations will increase the size of past liabilities of 30/40/50 years ago.  ... I see zero reason to collect donations if those donations instantly disappear or if the future is in question.  

It would be nice if new donations after the lawsuit submission date could be treated / preserved for new use, but there is no clean accounting method to say what paid for today's debt and what is protected for tomorrow.  Only real method is to hold-off donations for tomorrow.  

[CynicalScouter]

Red line version of the Modified Amended Disclosure Statement

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/8ad0771c-f79e-40c9-ae6c-4e145ccac9f9_6418.pdf

New Timetable: Voting October 15-December 14; results December 21.

Scaling factors are added. Gray 1/2/3 is back AND they have a chart for claims values for both BSA's version and the TCC version. Pages 33-35 (BSA version) and page 37 (TCC).

My 9.5% estimate was correct enough (actual is 9.63%). My math is within a few hundred dollars of the TCC math.

I will NOT list the data because it mentions particular acts of abuse, but I'll posted a redacted version shortly. This is huge. This is massive. This is BSA telling victims "you will get next to nothing" and the TCC saying "in our view, you'll get even less than that."

Edited September 29, 2021 by CynicalScouter

[CynicalScouter]

Here is where BSA and TCC differ:

BSA in its computation of expected amounts to victims is using HIGH END and LOW END numbers. So for a Tier 1 claim, it is giving estimates based on $2,700,000 and $600,000.

TCC is computing entirely on the low end number.

As for total abuse claims: TCC

Quote

The Tort Claimants’ Committee calculated the range of values of all asserted Abuse Claims is $13.5 billion to $73.2 billion taking into account the Base and Maximum Claim values under the Trust Distribution Procedures and the range of statute of limitations discounts.

BSA

Quote

Under the Plan, the Debtors estimate that holders of Direct Abuse Claims will receive between 10-63% of the value of such Claims. To calculate these recovery percentages, the Debtors took the known value being contributed to the Settlement Trust, excluding the TCJC Settlement Contribution,45 as of September 23, 2021 ($1.604 billion) less estimated costs to operate the Settlement Trust and divided such amount by the Debtors’ estimate of the aggregate value of Abuse Claims which is between $2.4 billion and $7.1 billion (as described in Article V.N.).

 

[CynicalScouter]

US Trustee noting that these documents got filed literally 15 minutes before the hearing and that the parties need time to review. Judge wants to walk through now.

[ThenNow]

1 hour ago, CynicalScouter said:

All attorneys will certify their actions and there are mentions of professional codes of conduct. In other words, this sets up potential attorney disciplinary proceedings if it turns out lawyers are voting ballots without the specific authorization.

Per my looong query 'years ago', I was waiting for this. As an attorney and claimant, I can't say I disagree. I'd still like to see the specific ethics provisions/standards on which they rely and are referencing by implication. 

[CynicalScouter]

The judge has now plowed over the TCC lawyers twice. She is in move, move, move mode.

[SiouxRanger]

3 minutes ago, ThenNow said:

Per my looong query 'years ago', I was waiting for this. As an attorney and claimant, I can't say I disagree. I'd still like to see the specific ethics provisions/standards on which they rely and are referencing by implication. 

And what penalty if an attorney violates an ethics rule?  If the attorney gets to keep the 40% fee, the attorney likely does not need a law license any longer, huh?

[skeptic]

It is still difficult for me to truly understand the use of the term "value of the claim(s).  As, it seems an impossible task to actually put value on pain, either physcial or emotional, or psychological (though that would be emotional really).  It still comes down to trying to make victims whole, and they will never be made whole.  And as has been noted from the beginning, the dragging this all out of the dark corners of many psyches just reinforces the pain from the past, and adds new pain as well.  No win, no matter what.  But big losses.

[CynicalScouter]

TCC estimated claims values (NOTE: TCC specifies the sexual act, I am referring to "Tiers")

	Base Min	Base Max	9.63% of Base Min	Open	Gray 1 Midpoint	Gray 2 Midpoint	Gray 3 Midpoint	Closed Midpoint
				100.00%	60.00%	37.50%	17.50%	5.50%
Tier 1	$600,000	$2,700,000	$57,771	$57,771	$34,663	$21,664	$10,110	$3,177
Tier 2	$450,000	$2,025,000	$43,328	$43,328	$25,997	$16,248	$7,582	$2,383
Tier 3	$300,000	$1,350,000	$28,886	$28,886	$17,332	$10,832	$5,055	$1,589
Tier 4	$150,000	$675,000	$14,443	$14,443	$8,666	$5,416	$2,528	$794
Tier 5	$75,000	$337,500	$7,221	$7,221	$4,333	$2,708	$1,264	$397
Tier 6	$3,500	$8,500	$337	$337	$202	$126	$59	$19

 

[SiouxRanger]

2 minutes ago, CynicalScouter said:

The judge has now plowed over the TCC lawyers twice. She is in move, move, move mode.

Aren't attorneys entitled to several days to review documents prior to a hearing?  That they get notice of a hearing and a list of the matters to be heard?

Holding a hearing on documents filed just minutes previously sets a horrible precedent.

[swilliams]

50 minutes ago, CynicalScouter said:

So, if Plan 5.5. fails and the judge orders a BSA-only cramdown, which councils are most likely to go into bankruptcy first?

Hard to say, but what we CAN say is how many councils as of August 17 are named defendants in lawsuits.

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

All 17 councils in NY are facing, at minimum, 20+ lawsuits. Greater New York has hundreds. You can easily assume all 17 are in Chapter 11 the day after a BSA-only cramdown.

Ditto the 22 councils in California, even the relatively small Western Los Angeles (4 lawsuits).

Aloha Council's gone too, not interestingly because of Hawaii but because of the 150+ Guam claims.

Question about how the lawsuits are listed.  If a council shows "John Does 1-10", does that mean there are ten lawsuits filed under that claim number?  If a second listing shows "Corp. 1-100"?

[Eagle1993]

There is a fight over the definition of scouting ....

Insurance companies & BSA are working on a definition of scouting....

Judge believes it is important and shouldn't be relying on a dictionary definition.

BSA ... programs offered by the Boy Scouts of America pursuant to charter and through organizations that the BSA has authorized to provide its program.

Edited September 29, 2021 by Eagle1993