How do you put a price on sexual abuse?
Well, the Boy Scouts of America (BSA), one of the largest youth organizations in the country, tried and failed. BSA’s proposed reorganization plan called for $2.7 billion in payments to settle tens of thousands of claims of devastating sexual abuse at the hands of BSA. It also would have released BSA from civil liability for abuse that took place prior to February 2020, when the organization filed for protection under Chapter 11 of the Bankruptcy Code.
92,000 survivors filed sexual abuse claims as part of the bankruptcy proceeding. And what they had to endure is tragic. The sexual abuse included exposure to pornography, unwanted sexual touching, fondling, groping, sodomy, penetration, and rape at the hands of former BSA leaders who were tasked with keeping the children safe. BSA did not make criminal background checks a requirement for all volunteers until 2008 – the organization was founded in 1910. For many survivors, the abuse lasted years. And many former BSA leaders sexually abused dozens of children.
Last week, on January 4, 2022, a preliminary tally of votes in favor of the proposed plan totaled 73.1%. This fell short of the 75% threshold that bankruptcy judges often use to approve reorganization plans in sexual abuse cases. Following this vote, on January 10, attorneys for BSA filed papers with the court projecting the total value of claims eligible for payouts to be somewhere between $2.4 billion and $3.6 billion and promising that “[s]urvivors of abuse will be paid in full” via the Chapter 11 plan. Liabilities were previously estimated at a range of $2.4 billion and $7.1 billion, however.
Attorneys representing survivors remain critical of the proposed reorganization plan claiming that BSA has undervalued the claims and that the organization’s specious promise to make survivors whole is entirely illusory. Victims’ rights attorney Carrie Goldberg had this to say:
It’s been deeply disturbing to see the bankruptcy system protect defendants that could and should be contributing to the abuse victims’ compensation. The bankruptcy framework is supposed to enable insolvent companies to surrender their assets to pay creditors in an organized fashion. But we’re seeing more and more defendants in complex litigations using bankruptcy court to jam up settlements and to avoid liability as well as our courtroom adversarial system – think Purdue Pharma, Catholic parishes, and USA Gymnastics.
In many cases, BSA is not the only defendant, but troop sponsors—including municipalities, churches, and schools—were also co-defendants. The proposed settlement hatched in bankruptcy releases these co-defendants too without the need for them to declare bankruptcy. It’s true that in exchange for these releases, troop sponsors must sign over their right to insurance coverage under shared policies paid by BSA to a trust. But the troop sponsors will not, themselves, pay for that release.
Though the end of this lawsuit – the largest single sexual abuse lawsuit in history – may be near, the psychological and emotional harm BSA and troop leaders caused the tens of thousands of survivors is something these individuals will have to live with for the rest of their lives.
So, how then do you put a price on sexual abuse?
EVERY 68 SECONDS, AN AMERICAN IS SEXUALLY ASSAULTED (Statistics from: RAINN). IF YOU OR SOMEONE YOU KNOW IS A VICTIM OF SEXUAL ABUSE, CONTACT THE 24/7 NATIONAL SEXUAL ASSAULT HOTLINE: 1-800-656-HOPE.
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