Eagle1993

1 minute ago, MYCVAStory said:

In the mean time, let's see if Century decides any sort of resolution isn't acceptable and pulls or lowers its offer because it will have continued exposure with Guam. 

Very good point.  I don't think the Guam claimants can disrupt this much.  However, if Century pulls out then the plan is dead.  Tanc made an ominous appearance just before the zoom call ended.  There is one piece that is being discussed that Tanc indicated was critical to not change materially.  The judge went back and forth with Tanc and she said as long as it is consistent with the plan she is fine.... and Tanc seemed to agree.  However, it was a bit disconcerting.  

I still think 99% chance this is approved and agree, it should have been done tonight.

Next steps ... order has some very discrete changes & process will be quick.  Guam claimants will have some time to review and will be served.  

Status conference to be setup next week Wednesday; however, unlikely needed.  If needed, will be very short and zoom only (save BSA$ on travel).  

So, expect plan approval Wednesday/Thursday next week (or earlier).  

Judge ... "interesting case".

Almost done.  Lujan giving it one last try, attempting to score 12 runs with 1 swing of the bat.  She should have settled back in 2019.  

One point of that $80+M of cash + the $63M reserved for JPM.  Based on the plan, as soon as it is effective (post appeal) BSA must pay all by $25M or so of their cash/non restricted assets and a big chunk to JPM.  So, I expect most of their current cash will go away and be paid out post effective date.

They also state they will get a $48M loan from the foundation to survive after they pay out most of their cash.

2 minutes ago, fred8033 said:

... Paid by BSA ... help me with my understanding.   BSA is also paying costs for legal costs for those with claims and overhead.  In addition, Omni, land appraisals. etc, etc.   So, I'm reading it as BSA is not spending $13m per month defending itself or being oppositional.  BSA is paying costs from many sides.  ... Please correct me if I'm wrong.

Correct.  BSA is directly paying their lawyers, TCC lawyers, Omni, consultants, Trustee, etc.  The only people they are not directly paying is individual claimant counsel (and actually some of them are attempting to get paid from the trust directly).

34 minutes ago, Eagle94-A1 said:

 

All joking aside, I do not think BSA, nor councils, can survive. I looked at the revised plan found Revised plan found at https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/7f73fba1-1980-4766-a6b3-d80e203fd73f_10263.pdf and I got concerns. Especially since I know one council plans to sell properties and reinvest the money into the main property. Yet the doc above says they are suppose to go tot the trust.

What is key is really Exhibit F.  In the end, as long as local councils in total provide $500M in cash & properties + $125M note they are free and clear.  If they miss this by $1, no council will have any protection.  There is a breakdown of donated property; however, that is subject to change if they provide cash vs property.

I think if they sell property, they are supposed to notify the court.  However, I know places are being sold and it seems like those concerns are no longer present as there is the $625M settlement agreement.

So, basically, BSA will need to herd the cats and ensure all make their contribution.

25 minutes ago, Eagle1970 said:

What are your thoughts on a timetable going forward?

Not an expert but one reference is Purdue as it is another complex bankruptcy case.  The latest plan was approved March 9, but there has been on appeals ruling yet.  Also, that one already went through District which took 2 months.  So ... if similar ... 8+ months?  Just attempting to ballpark this comparing to a similar case.  

I know district on Purdue took 2 months and that was considered very fast (and they rejected the plan).

So, in Purdue, they are 1 year past their original plan confirmation date.  So, it is very possible we are talking 12+ months, but my hope is closer to 4-6.

Hearing has started and ongoing.  It seems clear the plan will be approved; however, some minor changes will be required (at least so far).  It could take a few days as they need to notify some other parties of changes.  

This will not go into effect until post appeal approval (so even after the plan is approved, BSA and others agreed it isn't effective immediately).  That also means BSA cannot say appeals are moot as they already implemented th plan.

Big change in BSA's financials.

17c7637d-c326-4612-9685-10cfeb89a4f0_10280.pdf (omniagentsolutions.com)

They transferred their entire Unrestricted RBT Balance to cash.  So, their cash went to $83.65M; however, their RBT Balance is now at $0.

The RBT is their "Retirement Benefits Trust".  

They also state they have $63M additional in cash set aside to pay JPM as they exit.

Their bankruptcy fees dropped (which is a bit odd).  THey showed a decrease of $5.9M in professional fees.  Total is now $362M.

8 hours ago, clbkbx said:

This is just what I wanted to know… is there a normal ratio of expenses to settlement amount? From what I’ve read and this discussion, it seems to vary quite a bit.

It looks like USA Gymnastics had costs in the range of $20M ... tough to really see.  Their settlement was 380 so cost was about 5% of the total settlement.  

11 hours ago, fred8033 said:

• How much further will it go?  six months more?  a year? 
• How much to setup and administer the trust?   Assuming trust goes for years.
• What percent of individual awards go to the individual lawyers?  

BSA's involvement will drop way off if the plan is confirmed.  They will have to still cover the cost of sending it to district and perhaps some appeals but I expect those costs will be far less than their $13M+/month they have been averaging.  If all goes well, my understanding is 2 months for District approval (December) and perhaps several months after for appeals.  Now, if the Purdue appeals court overturns their bankruptcy case BSA's plan could be in trouble.  

All the trust costs come from that fund, not the BSA.  The settlement trust will pay those fees.

I understand that varies. I have heard anywhere from 33-50%.  

12 hours ago, clbkbx said:

I've often wondered this (what is a typical fee to settlement ratio) and never found a good source. If the above is normal, wouldn't the fees in this case be about 50% less than normal? 

$2.7B x 0.25 = $675MM and $2.7B x 0.3 = $810MM. Currently at $368MM. 

(BTW, I'm not a lawyer!)

$368M isn't the total fees.  Don't forget that every claimant that has a lawyer will pay a large portion of their claim to them.  In addition there are large bills that have yet to be decided from the Coalition.  $368 is simply the direct bankruptcy costs paid by BSA.

On 8/30/2022 at 2:09 PM, ThenNow said:

Debtors' side of the aisle? 

No breakdown from what I could see. 

2 minutes ago, ThenNow said:

I would love to see the breakdown by firm. 

That's a lot o' photocopies...

35 minutes ago, 1980Scouter said:

What do you think it costs to operate National for a month? 5 million? Under normal conditions not bankruptcy. 

I think it is really tough to say.

If you look at the few years prior to bankruptcy, BSA lost:

$22M in 2019

$58M in 2018

$41M in 2017

However, these were not cash statements.  In addition, BSA has changed a lot since 2019. 

I expect they will exit bankruptcy with <$20M in the bank (as bills are still coming in).   Who knows the backlog of work they have and what payments they face on their debt as they exit bankruptcy.  I don't envy BSA leadership, they have a tough slog ahead.

Note that as of end of June, BSA had $32M in cash in the bank.  They started with $117M and $55M (endowment) so burned through $140M of cash since Feb 2020 (through June 2022).  Assuming plan is approved Sept 1 (or shortly thereafter) and confirmed ... they are looking at $400-$500M of debt and $30M in the bank.  I expect their debt to asset ratio to be 1:1 at best, I believe they have Sumit worth $300M+.  BSA will need a huge injection of cash plus look at fee increases.  They need to get off the edge of Ch 7 fast.

I know no one is happy, but if BSA went over that Ch 7 cliff (which it was probably to) then all of the insurance settlements and councils would abandon the plan.  There would be very little payouts to anyone and claimants would have been stuck with suing individual councils and COs.  I expect some claimants would have fared a bit better, but the vast majority would likely end up with little to nothing.  

Graphs.pdf

3 hours ago, Wyobkr said:

$198,046,270.81

Based on end of June, I see:

Approved to date for bankruptcy:

Professional Fees : $240M

US Trustee Fees: $2.5M

Other Reorg Expenses: $125M

Total Bankruptcy Expenses: $368M (OUCH) ... you can almost buy a nice camp for that

Further Breakdown:

Debtor Professionals - $148M

Committees & Mediators - $84M

79443f84-dbaa-4574-838d-8d9810da69d8_10142.pdf (omniagentsolutions.com)

Several claimant representatives and certain insurers filed objections to the revised plan.  The certain insurers had the most comprehensive set of objections and included recommended revised language.  

It appears the fight is really about Dr. Bates and his estimate.  Essential the BSA, TCC and Coalition are attempting to say Dr. Bates is correct to allow plan confirmation but we expect he will be wrong so we want the court to confirm the plan saying it is 100% funded but also confirm the plan saying the trust isn't bound to that amount.  Certain insurers are basically laying the groundwork to say the plan is funded so leave us alone. They call out the TCC a bit as the TCC didn't object to Bates.

The other points are around language that was changed that goes beyond the opinion and language that wasn't changed that must be.

Hearing Sept 1.

22 hours ago, Eagle1970 said:

Would someone be kind enough to clarify for me the implications of pre-1976 abuse, as mine was just prior to that period?  Are CO's not released due to that timeframe?  And, if so, does that become a mitigating factor in the matrix?  My CO was a Catholic Church.

I'll add that I do not believe having a non contributing CO negatively impacts you in the matrix.  However, I expect we will learn more once the trust is officially setup and starts processing claims. 

11 hours ago, DuctTape said:

District and Council events are mostly the antithesis of patrol method camping anyway. I discourage them (to the adults).

Our District Klondike is probably the best patrol method event of the year.  

46 minutes ago, yknot said:

It's going to be interesting because the Methodist church is in the middle of a schism and some of those who are looking to break away are not paying some or all of their apportionments plus looking to take assets with them. It may be difficult or at least complicated to come up with payments for an undetermined period of time. Although in the face of $2 billion, $30 million is not a lot. 

Actually, they already have the impact in the plan ... took me a while to find it.

Quote

If the United Methodist Release Effective Date fails to occur for any reason, including without limitation because the United Methodist Entities fail to contribute the full amount of the United Methodist Settlement Payment (less the Reserved Amount as set forth herein) to the Settlement Trust or the United Methodist Escrow Account on or before the date that is the three (3) year anniversary of the Effective Date of the Plan, such that the United Methodist Entities are not Protected Parties, then any amounts held in the United Methodist Escrow Account or the Settlement Trust shall be returned to the United Methodists Entities that paid the monies into the United Methodist Escrow Account or the Settlement Trust.

So basically, if they don't make good in 3 years and pay the $27.5M, they will no longer be protected and can be sued directly by abused.  They are expected to pay $2M within 180 days, $25.5M in 3 years and keep $2.5M reserved until year 6.

4 hours ago, yknot said:

I don't know if it belongs here or not, but the regional UMC conference for my area sent budget guidelines out yesterday that broke down how much each local church has to contribute to the boy scout bankruptcy settlement over the next three years.  A number of churches already aren't paying their current apportionment for a variety of reasons from financial to philosophical and political so this is interesting. Local UMC churches that did not have a history of chartering a unit thought they were going to be unscathed but all churches will be required to pay. It doesn't appear to be a lot of money but for those churches who are currently having difficulty paying the electric bill, or who have a deep philosophical argument, it's possibly a bit of a lit match. 

The reason I put this here is because I wonder what happens generally if a third party finds it is unable to honor its commitment to the settlement? 

 

If the UMC does not pay, I expect the Trust will sue the UMC.  They would sue for the $30M plus interest, court costs, etc. 

Prof Jacoby had a quick summary of the 20 minute hearing yesterday.  No survivors spoke nor their attorneys.  DOJ didn't speak.  BSA plans to seek district court approval as they believe that is needed given the releases.  Non settling insurers will likely appeal.  

More from Reuters. 

https://www.reuters.com/legal/litigation/boy-scouts-insurers-prepare-appeal-bankruptcy-settlement-approval-2022-08-18/

• Question 1 - how are you involved in scouting
• Question 2 - Which scouting value most compelling
• Question 3 - Which value least compelling (only 4 listed and not sure how you would pick any of these)
• Question 4 - Which trait is most important (honestly, probably the only question in the entire survey that is useful for feedback on program development)
• Question 5 - How important to you that BSA survives
• Question 6 - Why did pick the rank you did in Q5
• Question 7 - How have you supported BSA in the past
• Question 8 - Why did you support BSA
• Question 9 - How likely to financially support BSA
• Question 10 - Why did you answer as you did in Q9
• Question 11 - Overall outlook of BSA in future
• Name, Email, etc.

Other than Question 4, I don't see any of these questions leading to any input into program priorities at all.  This seems to be clearly a collection of data to give someone to make a fundraising pitch in the future.  They can use some answers to prioritize and then personalize the pitch based on the rest.

I don't take this as negative, it is probably the right strategy to fundraise.  BSA, as part of their recovery meeting, mentioned they believe they need to raise $400M in donations as they exit bankruptcy.  This will require both large & small donations and separate from FOS.

2 hours ago, clbkbx said:

Thanks. Two comments on the article. 
 

1. I thought the case was going to be appealed. This article says it’s uncertain. I wonder if that’s just because of where the case is or if it not being appealed is a possible outcome. 
2. One of the interviewees said “For some victims it’s a great result,” which is something I haven’t heard from anyone. Is there a scenario where someone is getting a great outcome?  

1. I also saw Prof. Jacoby question who would appeal.   It is a good question as she said most major parties are on board.

There were a few claimant law firms fighting hard.  One was Guam ... well, they keep their insurance for now which was their major ask.  The other was about TCJC... well, now they can sue the TCJC.  The third was more general.  I expect law firms may give up spending more time on appeals and just focus on maximizing recovery through TDPs or independent review.

Non settling insurers will probably appeal.  

US Trustee?  That is the big question.  My bet ... they will fight this.  The US Trustee has been clear in every bankruptcy case I could find.  Non debtor releases should not be allowed.  I expect they will appeal.

2. If you are outside the SOL ... yes you could fight that, but it is likely most lawyers wouldn't have taken the case outside bankruptcy.  This was one of Bate's main points.  That a large number of the 82,000 would have received nothing outside bankruptcy court.  So, I do expect there are many, who will receive more money than they would have outside bankruptcy.  Now, is that $10-$20K worth the pain of the trial, wait, reliving abuse ... that will vary.  I do expect there are many that could have received $10-$20M; however, technically, the independent review should address those as well.  If you believe Bates, which not one law firm provided evidence he was wrong, then you believe everyone will receive the amount they are due based upon our current tort system.  This is not to say that is a fair payment.  I also question Bates, but nothing was brought up in court.