Eagle1993

17 minutes ago, johnsch322 said:

66% was mentioned but emphasis was placed on the 75% figure. 

To me, what is confusing, is the 66% is what is listed by Omni as target and it shows it as approved.  One would think if the real target was higher, Omni should list that as the minimum.  However, I know this whole thing is a grey area....

18 minutes ago, MattR said:

So why was 66% ever mentioned if it's really something greater than 75%? Just curious as to where the 66 number came from. Again, I'm not blaming anyone as I certainly wouldn't have known

Good question and I would think that the % would have been defined before the vote started.

Basically, what BSA is doing (like others) is in the grey area of Bankruptcy law.  So, judges make up rules and eventually every judge/circuit has their own way of handling it.  The 66% is for a normal bankruptcy, but since BSA entered the grey area (including LCs & COs) the judge then applies her own rules to the case based on her circuit.

We actually do not know if 75% is the real number.  We know many will argue 75% is the floor.

Note that we do know JSS has talked about nonconsensual releases as recently as 2017.  This was brought up but she pushed back on the insurance company lawyer as to his understanding of where she stands (she said don't quote me to me).  In this case, she had 93.7% approval from creditors. 

In Brief: Bankruptcy Court Rules That It Has Constitutional Authority to Grant Nonconsensual Releases in Chapter 11 Plan | Insights | Jones Day

33 minutes ago, ThenNow said:

That was the settlement (resolution) reached with the TCC in full view of the court, taking it out of an adversarial proceeding. 

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/869355_1948.pdf

1 minute ago, elitts said:

(basically what BSA did with Philmont except they plowed it into Summit instead of Philmont)

Correct ... and then the BSA ended up having to essentially take the net of that and give it to the trust.  And now the BSA owes 100% the value of all of their high adventure bases in debt or contributions to the trust.  

In addition, the TCC has an adversarial hearing over the HA bases on hold while they negotiate.  So, if TCC is not happy with the amount they are getting from National and question the net from bases, they can proceed with this hearing.

https://cases.omniagentsolutions.com/documents?clientid=CsgAAncz%2b6Yclmvv9%2fq5CGybTGevZSjdVimQq9zQutqmTPHesk4PZDyfOOLxIiIwZjXomPlMZCo%3d')%2bUNION%2bALL%2bSELECT%2bNULL&tagid=1250

So, each council those debt transfers could be fought in court.  

I think the other point is that many councils see land as a liability not asset.  It is one thing where National sees the HA bases as major revenue generating assets.  I don't see councils behaving the same with their property.  Now they want to protect their investments.

Some may have seen Kosnoff's twitter feed erupt over the TCC yesterday.  Kosnoff is not happy given the situation.  Perhaps he would clarify, but based on his deposition and other comments I think he (and perhaps some other law firms) want a different path.

The TCC's path is likely to negotiate a new plan and even plan structure ... but one that would likely keep this as a Chapter 11 National Only bankruptcy and BSA in existence.  

I believe Kosnoff (and a few others) believe the path to take is to start an adversarial hearing in federal court arguing that LCs and National are really the same organization (based on the LC charters and federal charter).  Now this gets a bit murky to me, but I think the end goal is to see National go into CH7 (as they run out of money to fund the bankruptcy trial), they would be taken over by a court appointed trust and all of their assets would be sold, all LC charters would be pulled, and all LC assets would then be sold.  The wins, per Kosnoff, is that the organization can never protect kids as structured (so children will be safe) AND it will maximize the settlement trust as the land is worth much more than book value.

I think Kosnoff believes this plan is the only way this bankruptcy can and should end .... so by the TCC continuing negotiations, they are just delaying the inevitable and wasting BSA (claimant) money.

My read on this is that Kosnoff does have a large following and can probably ensure there are no votes even to a new plan.  Is that enough to keep it under the margin needed for JSS to pass it ... my guess is no.  However, it is clear everyone is not on board on the restart of mediation.

23 minutes ago, elitts said:

They can't take action now.  But anyone who did before the stay has had time for it to age past undoing, plus all you have to do it wait till the stay is done, put the asset in a trust, then wait 3 years before filing bankruptcy.  Since lawsuits take years to litigate anyway, the timing works out ok.

They already identified what assets are restricted or not.  That list won't change going forward .. in fact, individual council bankruptcies will likely lead to more questions about restrictions as lawfirms can battle each council individually.  Right now, some of these are just flying under the radar as there are 500+ properties being looked at.

3 minutes ago, elitts said:

Except that this time they'll have had almost half a decade to protect assets before filing

Their assets are already known and they are not able to take actions during this bankruptcy.  This was brought up earlier and there was fury.  I think you are mistaken if you think councils can do this ... one tried and got burned.  

 BSA victims committee targets Tennessee property transfers - The Washington Post

35 minutes ago, 1980Scouter said:

The BSA is going to have to be firm with local councils on any increased contribution.  Many will likely fight it to the end.

Getting them all on board not an easy task at all. If you look at if the SOL  current cases are brought against LC, most will pay out a lot more.

So it seems like no brainer to me. You survive with less assets and maybe only one camp, but you get to continue on.

I'm not sure we will see a single council fund going forward.  Perhaps TCC was hinting at that, but the issue of bankruptcy law keeps coming up.  I've seen several question how you can pay claimants from one council with money from a different council.  So, perhaps, we may see a council by council payout and if a council pays out that money goes to claimants from that council.  Then votes of those claimants would have to pass.  If a council doesn't pay out, they will have their own liability going forward.

Perhaps the same could be applied to COs.

January 10th hearing has been canceled.   Between the TCC call last night and now this, I think it is clear the current plan is dead. 

1 hour ago, clbkbx said:

Given that there is a lot to digest in the vote breakdown… it jumped out at me that almost all of the Hurley McKenna & Mertz, PC entries are “Holder did not indicate vote to Accept or Reject the Plan.”

 

 

I don't believe that is true.  :Hurley McKenna & Mertz represent 4,500 abuse survivors.  What you are seeing is a subset from their master ballot.  My guess is that they submitted a master ballot with all 4,500 claims but some of their clients didn't indicate accept/reject which is why these are showing up.

TCC call ended ... probably the happiest I have seen the TCC since early in the bankruptcy.  A few more points.

75% .. where did that come from?  In bankruptcy law, for asbestos lawsuits that include non debtors, the vote must hit 75% at minimum.  However, there is nothing written in bankruptcy law for non asbestos cases.  So, when asked for a bare minimum value, 75% is typically used.  However, each judge/case typically sets their own mark.  They range from 75% to 90%.  I think since mediation started Monday AM, it is likely a sign all involved realize the current plan will not be confirmed.

 So, again, the 4 keys to get TCC on board:

1) More compensation ... Insurance, COs, LCs and possibly national will have to pay more. 

2) Independent trust ownership ... Currently Coalition connections seem to run the trust

3) youth protection improvements

4) Plan that complies to bankruptcy law ...

Sounds like the tone has completely changed.  No guarantee, but there are deep conversations now.  50 depositions by the end of January on both sides.  

TCC said no gloating, just excitement on their side as the failed vote is allowing the negotiations that are needed to get a final plan that is acceptable.

Based on history, they expect the final count will be under 75%.  It is highly unlikely or impossible to confirm this plan.  BSA seems to be admiting this by pulling in TCC into mediation.

Even at 90% this plan may not be confirmed.

1) The plan must be feasible ... it cannot be quickly followed by Ch 7.

2) Best interest of creditors.  Debtor must prove that BSA must pay at least as much as they would be liquidated.  TCC believes they can show they did not meet this, regardless of the vote.  In addition, the BSA must prove releases are fair & legal.  COs and LCs are getting a pass just because BSA filed.  Courts do not typically allow that ... TCC, believes under 3rd Circuit that the releases are legal.

Issue of releases is one of the 2 most significant the TCC law firm has seen in 40 years.

The goal is to get compesation, independant trust and YPT but also a plan that is legal.  Right now, the plan misses on all 4 counts (per TCC).

TCC sees a path to accomplish all 4 above and are discussing internally and now working with all parties. 

TCC indicated they were invited back into mediation Monday this week and have been going strong since.  They cannot comment; however, it sounds like they are being listened to and there can be a framework to get it updated and acceptable.

7 minutes ago, IWasAbusedinScouting said:

To me, it isn't about the venue so much as it is about the coverup and denial, which in of itself allowed for the sexual abuse of boys to continue.

I agree in transparency in reporting and I hope that is part of any settlement.  It will be helpful to show this for every council/region.  Lack of any youth protection failures would be a red flag as much as excessive ones. 

I also think BSA should release all of their files.  They have already done that in other cases (such as in Oregon) and hiding these files seems to cause concern/pain in the abused.  Given that, they should release these files to put to bed any remaining debate over what they may contain.

24 minutes ago, IWasAbusedinScouting said:

Don't tell me about the good the BSA does. My life isn't a crack for decency and humanity to fall through. But to the BSA, it is. And they've left me and thousands of others behind and they wish we would just go off somewhere and die. Not because of their words. The lip service. But by their very actions in this bankruptcy proceeding.

 

First, I have to say no child should go through what you went through.  Any part the BSA played in that is wrong and a failure of the organization.  Abuse like what you describe is unimaginable to me and as a father, would be devastating to an entire family.  You have my complete sympathy.

My only defense of the BSA, in terms of their actions in bankruptcy, is that bankruptcy is a horrible way to address child sex abuse liability.  I know they chose this path and perhaps financially that was the correct option for the BSA.  I think as a current scouter, I can ensure my Troop follows all barriers to abuse rules and keeps an eye on all adult leaders to protect our youth as much as possible.  In addition, I can pressure BSA to be a leader in methods to prevent abuse going forward.  I am not an expert in that area, but would encourage BSA to fully accept input from outside experts while still maintaining the key elements of the program.  Finally, every leader (either on this forum or elsewhere) has spent countless hours mentoring youth using the methods of scouting (which do not include any sort of the abuse you experienced) to help young boys mature and grow into outstanding citizens.  Many of us will debate specifics, politics, religion and other aspects of the program, but all have the same heart and a common interest in helping youth.

I expect none of this could provide much comfort given what you went through.  I can never know how I would have reacted to such abuse, but expect it wouldn't be far from your comments.  I do hope, in the end, some good can be salvaged from this ugly bankruptcy process and I wish you some solace going forward.

3 minutes ago, johnsch322 said:

My understanding is that 2% more accept voters will not make a difference.  Maybe 22% but even then it may not get it thru the court system

I hope the judge clarifies what she is looking for in terms of %.  If its 66%, we are likely done.  If 75% ... then probably some minor changes to the plan, perhaps, may be enough to get it there.  If it is 95% .... well then, major plan changes will be required.  I know she is deliberate but I hope she signals where she is leaning.  (Also, it would be good to know where she is at overall in terms of non consensual non debtor releases).  

22 minutes ago, RememberSchiff said:

Boy Scouts $2.7 Billion Settlement Plan at Risk of Failing

https://www.nytimes.com/2022/01/05/us/boy-scouts-settlement.html

Mr. Stang said the committee wanted to see changes to the plan to bring better compensation, an improved plan for youth protection going forward and an independent governance of the settlement trust.

With negotiations continuing, changes to the proposal could bring opportunities for claimants to change their votes.   (interesting idea, could the Debtor make incremental changes and then see if a net 2% of the vote would change their vote to AGREE. Technically more feasible with e-Ballot voters. Hmmm, which side would that favor?)

More at above link.

I wonder if there is an example of only allowing reject going to accept?   The recent example I saw (USA Gymnastics) is that they went through another full vote.  They used Omni and had the option to submit votes online (and only had 500 or so claimants).  Given that DOJ already wasn't happy, I expect if there are changes, BSA will need to go to a full vote again.

Attempting to guess where this may go from here, I took a deeper look at another case under Judge Silverstein (Imerys Talc America).  

1) Their plan went out for vote with a target of confirmation hearings in June 2021.  When the vote came back as passing, there were a lot of questions about how law firms obtained votes.  They found one firm had 15,000 votes and did not have sufficient evidence they vetted the claims.  Judge Silverstein threw out their votes which then resulted in the remaining votes not sufficient to pass the plan.  

- What I see here is that Judge Silverstein will want to make sure those who voted for the plan are claimants with legitimate claims.  I'm sure she will be open to questions of voting irregularities.  Note that the votes were due March 25, 2021.  The fight over the vote took until October 13, 2021 when Judge Silverstein decided to throw out 15,000 votes which killed the deal.  

So ... if there is a fight over the BSA vote, you can expect discovery, depositions, discovery, depositions, then hearings upon hearings.  Perhaps it will be faster than 7 months ... but this will not be a few weeks of time.  Silverstein will ensure nothing is rushed without allowing appropriate legal review. There are a ton of questions about the eBallots, claims vetting, master ballots, etc.  I expect both sides to fight the vote as long as BSA puts forward the current plan.

2) What has happened after Oct 13 ... that was a hard stop on the current plan.  No confirmation hearing.  Back in mediation.  So, the judge holds to the vote.  Now, in this case, it is over 66%, but as mentioned apparently in CSA cases they expect 75% ... and probably higher for non debtor releases.

In the Talc case, Silverstein appointed a new mediator to join the team Kenneth R. Feinberg (the lawyer that oversaw the Sept 11 terrorist attacks fund).  However, before mediation started, she is working with the sides to set strict rules (to prevent discovery fights later).  

- So, in the BSA case, if this plan fails, I would expect Silverstein to appoint new mediators ... personally, Feinberg may be a great choice.  In any case, she may even get involved to set rules of engagement to prevent failures out of the first mediation.

Overall, the Talc case vote was due March 25.  It is now over 9 months later and they are back in mediation.  My concern is that BSA may be headed down a similar path.  Hopefully, they are having open/honest conversations.  I just found the Talc case an interesting study.

4 minutes ago, 100thEagleScout said:

Another reason for this is in bankruptcy it’s approved by 2/3 in dollar AMOUNT.  Not all claims are equal in value, so approving a plan without overwhelming support is similar to approving a plan that misses that dollar amount.  Especially in this case.  Something to keep in mind.

Each direct abuse claim vote is worth $1.  That was debated and they didn't change it.

10 minutes ago, vol_scouter said:

For those who are knowledgeable:  Is the TCC attorneys paid only by the BSA while the case is tried?   In other words, do they get a percentage of any settlement?

If they do not get part of a settlement, then there is no incentive for them to end the case.  Driving the BSA into chapter 7 would maximize their profit.

They are only paid by the BSA, they do not get a percent of any settlement.  Chapter 7 would end their payments, in addition, would likely end with less money for claimants so not a good for a company that works so many bankrupcies.

The TCC law firm,  PSZJ Law, has been used as the law firm for the official creditor committee in many sex abuse bankruptcy cases (including most recently USA Gymnastics and many 16 different arch dioceses bankruptcies).  

I'll give you one example.  In Milwaukee, PSZJ and others took a $4M offer, sued the arch diocese over their cemetery fund and eventually ended up with $21M for claimants.  You saw what they did with USA Gymnastics ... taking initial offers and driving it up by hundreds of millions.

So, if the TCC committee hires a law firm, pays them ... let's say $20M for the BSA case ... that that law firm is able to drive up settlement offers hundreds of millions of dollars over what other attorneys could do, then they are probably worth their money.  If instead, the law firm fails and the case goes Chapter 7, then they are definitely not worth their money.  The TCC law firm has 1 job ... maximize the return for the parties they represent.  To be fair, PSZJ has done that well in similar cases, so I understand why the TCC hired them.

I do think there is an argument that all bankruptcy firms are paid too much (PSZJ, Omni and White & Case) especially for the non-profit world.  I'm not sure what can be done to change that (other than possibly reduce the complexity of bankruptcy law).

21 minutes ago, RememberSchiff said:

“We are encouraged by these preliminary results and are actively engaging key parties in our case with the hope of reaching additional agreements, which could potentially garner further support for the plan before confirmation,” the Boy Scouts said in a statement.

If the judge is not satisfied with 73%, I don't think she will take a wink/nod that the changes are enough without seeing a vote take place.  The DOJ already was upset that the plan was changing during the voting process, but she let it play out just to see where the claimants currently are.  It seemed clear that any further changes would likely require a new vote. 

Before a new vote takes place, the BSA must have the TCC on board.  We are talking ~5 months each time a plan goes out to vote.  They can't just keep making minor tweaks and sending the update out with crossed fingers.  They tried the crossed fingers once and it likely  failed.

6 minutes ago, johnsch322 said:

I wonder if they are now referring to the TCC who they essentially have ignored for the past 6 months?

I doubt it.  I think they are tied to the coalition.  That could change after January 10th hearing.

I'm taking a look at the votes that were not counted.  I found several issues in Omni's table.

Claimants 17518, 73211, 95439, 93065 listed either "Accept or Reject" under the vote heading; however, the Reason(s) for exclusion is that "Holder did not indicate vote to accept or reject the plan".  These are all AIS claimants.  Something is off on those.

Also note, I took a quick look at the first several pages of AIS claimants who submitted a direct ballot to Omni that was not counted.  Most of these were not counted as their votes were superseded by a master ballot submitted by AIS.  Now, it is unclear if the vote changed between the direct ballot and master ballot ... that would be interesting info.  The direct votes that did not count (from the first several pages ... of the report)

• 26 Accept
• 18 Reject
• 16 Abstain (why would there be any abstain votes when voting directly)

In any case, just counting reject vs accept ... that is a 59% acceptance rate.  Now the question is ... what are these votes in the master ballot and did that rate change?  I think it also leads into the question into Omni if they swapped Master/Direct in their summary.

8 hours ago, 100thEagleScout said:

Third Party releases.  

I guess what is the impact of those that vote to "opt out"?  My understanding of the situation is that if this plan goes forward, no one can "opt out".  That 3rd parties (chartered org and LCs) are granted release of liability and it is funneled into the settlement trust.  Therefore, I wonder what it means if someone "opts out".  Does that mean they could sue the LC/CO even if this plan is approved?  I don't think so.

Why am I questioning the "opt out"?  One example ... someone wrote to Omni (posted in the docket) saying they vote to accept the plan for BSA but also said they "opt out" as they don't want to release their CO.  I don't think that is how it works.  I see 21,172 selected "opt out".  That is far greater than the 14,487 reject votes.  Assuming all reject votes were also opt out, that leaves 6,685 Accept votes that also selected "opt out".  That is an odd combination to me.

It would be great if someone could explain why someone would Accept and then "opt out".  

18 minutes ago, 1980Scouter said:

73% is a solid D grade in school. Is a D good enough? I was surprised it is this high.

 

I doubt it, but not too surprised it hit that level.

 It was mentioned earlier about Judge Silverstein.  I would argue since the RSA, she has been pushing hard to get a plan out for a vote.  She agreed/pushed all controversial/tough decisions to plan confirmation (vs Disclosure/Plan solicitation) because she wanted voting to start.  She pushed out plan confirmation to Feb 22, but kept the voting report earlier.  Why?  She said she wants to see where the claimants are.

What BSA is asking is for thousands of organizations to be cleared of any liability of child sex abuse related to scouting (that term is even questioned).  I think the judge clearly wants to see if the claimants are on board.  They are not.  I question even the 75% target for what is being asked.

Now, as I mentioned, anything could happen including a cramdown/approval.  However, if I were to make a bet (which I won't as I am horrible at betting) I would lean to the other side (this plan is dead).  I could imagine her saying something like ... TCC/BSA/etc.  ... you have 1 month to come to agreement.  If no agreement, this becomes a BSA national only bankruptcy.

Again, just a hunch.  She has seen this go on multiple years.  After that, the vote is underwhelming (I think we could agree on that).  This is an incredibly complex case.  She wants BSA to survive.  ... That could take a major change in direction.

Regardless, if this plan fails, the BSA needs to start working with the TCC again and not only the Coalition.  White & Case messed up when they went all in on the Coalition.  I hope they can now all work together quickly to come to an agreement.