Chapter 11 announced - Part 14 - Plan Effective

[clbkbx]

15 hours ago, skeptic said:

not get billable time

Aren't most lawyers working on a contingency where it would be better for them to do more hours? That’s the complaint I’ve heard from survivors: that they can’t get a response or have their attorney do anything for them.

[fred8033]

On 11/23/2024 at 11:26 PM, Ojoman said:

They already have 1 billion of the 2.4... I think I have that right... Class actions ought to be capped at 10%... 

That might need clarification.  Is it 1 billion of the 2.4?  Or is it a large sum paid by invoices over the last 4.5 years as part of bankruptcy proceedings?  And two more groups that is being paid as a combination of invoiced hours to cover bankruptcy administration (some law firms) and shared client awards (other law firms)?

I am really curious what the bankruptcy legal fees were before the settlement?  And what the admin cost will be after?  And what portion of the awards will be shared with attorneys?  Total before and after must be over a billion.  

I'm just curious.

[fred8033]

On 11/24/2024 at 10:55 AM, clbkbx said:

Aren't most lawyers working on a contingency where it would be better for them to do more hours? That’s the complaint I’ve heard from survivors: that they can’t get a response or have their attorney do anything for them.

Contingent representation means a percent of the award instead of billable hours; usually.  The lawyer won't earn more money by returning the client's calls.  So not getting a response in a large class action is not surprising.  

Effectively contingent cases means less earned per hour with each extra hour invested.  The least hours invested the better for the law firm.

Edited November 25, 2024 by fred8033

[clbkbx]

14 minutes ago, fred8033 said:

The least hours invested the better for the law firm.

Duh... that is what I meant to write. I was trying to make the point that it would typically be better for folks to have their lawyers do as much as possible from a cost perspective. 

[Ojoman]

10 hours ago, fred8033 said:

That might need clarification.  Is it 1 billion of the 2.4?  Or is it a large sum paid by invoices over the last 4.5 years as part of bankruptcy proceedings?  And two more groups that is being paid as a combination of invoiced hours to cover bankruptcy administration (some law firms) and shared client awards (other law firms)?

I am really curious what the bankruptcy legal fees were before the settlement?  And what the admin cost will be after?  And what portion of the awards will be shared with attorneys?  Total before and after must be over a billion.  

I'm just curious.

'even when a lawyer takes a case on contingency, additional expenses like court filing fees, expert witness fees, and costs associated with gathering evidence can be added on top of the contingency fee, meaning the client may still need to pay these costs even if they lose the case; these expenses are typically deducted from the settlement amount if the case is won'

 

[GHamm]

Through an email to the settlement trust asking for any sort of update on my case, in the beginning of July I was told it was ‘under review’. It’s now going on a half of a year in review. Does this seem normal under the circumstances? 

[swilliams]

13 hours ago, GHamm said:

Through an email to the settlement trust asking for any sort of update on my case, in the beginning of July I was told it was ‘under review’. It’s now going on a half of a year in review. Does this seem normal under the circumstances? 

I can't speak to this case, specifically, but it seems the answer is yes.  Unfortunately the legal system moves slower than snail's pace.  I have an open ethics complaint that I filed in June of 2022 that is still not fully decided.  It is nearing the end, though.  The final agency must decide whether to adopt the findings of the judge in their session later this month.  My complaint was combined with two others, but relatively straight-forward, and it still took 2.5 years.  It took nearly a year for the judge to decide whether to grant a request for summary decision. 

[skeptic]

As noted numerous times.  Our judicial system is broken in many ways.  It still favors power and money, which often are hand in hand.  It also seems to easily be swayed by social media and so on.  Wose though is that there are simply far too many less than honest lawyers, in my view.  

 

[Tron]

On 12/9/2024 at 11:22 AM, skeptic said:

As noted numerous times.  Our judicial system is broken in many ways.  It still favors power and money, which often are hand in hand.  It also seems to easily be swayed by social media and so on.  Wose though is that there are simply far too many less than honest lawyers, in my view.  

 

This is unfortunately true. The individuals with the power and money to affect the timeline of any court case often are the winners regardless of the law.

[clbkbx]

Too soon to estimate what the claims values will be vs how the Trust is funded? Maybe (and I listed some possible reasons why below) but as of January 1, 90% of the expedited distributions have been paid (at full value) and 10% of the matrix claims have been paid (at 1.5% value). Like the expedited distributions, the IRO is somewhat less important to the matrix but 2% of claims have been paid (also at 1.5% value).

Current average expedited per claim: $3,284 *  6,027 claims = about $20MM

Current average matrix per claim: $484,254 * 57,953 claims = a little over $28B

Calculated as: ($42,268,754 paid out minus $698,000 advanced payments) divided by 5,723 disbursements = $7,264 per claim on a 1.5% payment (or a full share of $484,254). Same for the IRO below but no advanced payment adjustment.

Current average IRO per claim: $900,000 * 275 total claims = about $250MM.

Add it all up and it's... a little over $28B. 

The last estimate I saw was the the Trust had about $2.5B but let's say the Trustee gets really good returns on everything to make the math easy with $2.8B and it's looking like it's 10% funded. Maybe the Trustee also settles with a bunch of insurers adding another $2.8B to the Matrix and then it would be about 20% funded.

Btw, disallowed claims are running less than 1% at this point. 

_________

One of the bankruptcy documents had a breakdown of votes, class and open/grey/closed designations. Assuming the matrix base amount for each class, the average claim based on that mix would have been $218,143 or half of the current average. Here some reasons why the current average might be higher than the final:

• claimants with a higher claim class were more likely to file timely
• claimants with a higher expected claim due to scaling factors were more likely to file timely
• law firms prioritized higher expected claims first in order to speed up payments they would receive
• claimants with the most documentation (and so maybe the more egregious cases) are more easily processed
• The Trust is finding more evidence of upward scaling factors than downward
• The percentage of disallowed claims will increase as the Trust asks for more information and it takes longer for these types of claims to be evaluated

Anything else I'm missing? 

If the claims even out more to base levels with a similar mix as was in the bankruptcy document, the Trust would be 20-40% funded. 

Lastly, the trust noted that 25% of matrix claims were determined as of January 23rd. They also noted that $70MM has been paid to approximately 12,300 survivors (across all classes). Here's a back of the envelope estimate: assuming the great majority of those in January were matrix claims, since the last update 9.9MM was paid to about 1,150 claimants at 1.5%... for an average claim amount of $573,913 at about 12% of matrix claims processed. It seems at least for the next update, there won't be much of a downward change in the average claim amount. Incorporating this into the overall averages: $499,256 per claim for 57,953 claims = a little less than $29B.

[Eagle1970]

I would agree with your premise that the higher value claims pushed their way to the front of the line.  Certainly in the Open state cases with attorney representation.  The average will very likely drop.  It looks like your over/under on eventual percentage to be funded is around 30%.  That is more/less the number I had in mind for some time now.  It would be great if the trust would be a little more transparent on this issue.  Hopefully, once the appeal is cleared, that will happen.

I do believe the trust had a better handle on this, all along.  To indicate to victims that their cases were worth triple what they will actually receive is another gut punch.  They had to have a basic idea of claim value and potential recovery.  At this point, I hope they put some real money into the hands of victims, as many are aging to the point it won't much matter.

[clbkbx]

1 hour ago, Eagle1970 said:

They had to have a basic idea of claim value and potential recovery.  At this point, I hope they put some real money into the hands of victims, as many are aging to the point it won't much matter

I am certain they did and hard to square with the Trustee’s statements about transparency. If we had the same information they do (on a confidential basis same as was given in the bankruptcy), we could get a maximum, minimum and likely average very quickly. I think it was before the final vote that we could look at the numbers and already know that it was less than 50% funded with very conservative estimates.

A major mis-step (or, conspiracy theory: purposeful approach) was that the Boy Scouts presented an expert who said it would be 100% funded and there was no evidence rebutting that, so in the certification the Judge said I’m relying on the only evidence that was presented.

I’m not sure what will happen, but agree that an acceptable outcome to me is getting real money paid out quickly. 

[Eagle94-A1]

Has the appeal been ruled yet? Will the money already awarded affect the decision if it hasn't? And is the plan gets overturned, what happens to monies already distributed?

[Eagle1970]

The appeal is pending and ruling due soon.  If it is overturned, they will demand back any payments.