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Chapter 11 announced

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50 minutes ago, yknot said:

I just saw this article: 

https://www.latimes.com/california/story/2020-10-22/boy-scouts-sexual-abuse-claims-bankruptcy

Not much new but speculation in this article ups the potential payout to 3 billion -- double the 1.4 billion estimate I've seen elsewhere. 

 

$3B would pretty much force complete liquidation, to include the Councils.  
I suspect the victims would then receive pennies on the dollar for their claims. 

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Plaintiffs’ lawyers note that with tens of thousands of claims, even a modest payout for each could reach into the billions of dollars. If 30,000 claims are paid at $10,000 each, for example, the total would be $300 million. But at $100,000 or more each, the total would soar to $3 billion or beyond.

The number doesn't worry me for now. $1.5 billion. $3 billion. $3 trillion. That number doesn't worry me.

What number worries me? How much Hartford/Century and the rest of the insurers will be forced to pay out on the policies.

Quote

Some of the Scouts’ insurers have refused to cover payouts in sex abuse cases, contending that the organization could have prevented the abuse that led to the claims, court records show.

If the court rules in BSA's favor and declares the general liability policies valid, then the fight turns to claimants vs. insurance companies. Let them tear each other apart. BSA hobbles away.

If, however, Hartford/Century and the rest convince the judge that they are out, then keep this in mind: you can't get blood out of a stone.

Past a certain point, there simply is no more money to be had. Liquidate the BSA's assets (leave it with literally nothing but that which is directly given by the Congressional charter, namely, the rights to the names, etc.) and that's only $1 billion.

Then they'll go after individual councils for the rest. That will be a slog; certain councils with few claims against them will survive. Others will be right behind National in the liquidation line. But even there, past a certain point, there's not enough money.

They they'll go after the COs. I've noticed a lot of appearances by churches as interested parties. They see where this is going.

For all those insisting this will be done by Q1 or Q2 2021, I don't believe it.

I said before I'll say again: Boy Scouts of America, the congressional chartered entity, survives. The Congressional Charter's provision that the organization/corporation is "eternal" saves it as a shell: no assets, no staff, no nothing but a board (again, congressionally required). And it rebuilds not from Square One, but Square Zero or even Square Minus One.

Edited by CynicalScouter

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11 hours ago, CynicalScouter said:

For all those insisting this will be done by Q1 or Q2 2021, I don't believe it.

Agreed.

The BSA has filed a motion "extending the Debtors’ exclusive periods to (a) file a chapter 11 plan (the “Exclusive Filing Period”) by 180 days, to and including April 13, 2021, and (b) solicit votes thereon (the “Exclusive Solicitation Period” and, together with the Exclusive Filing Period, the “Exclusive Periods”) by 180 days, to and including June 14, 2021, without prejudice to the Debtors’ rights to seek further extensions of the Exclusive Periods".

And nearly two years after filing Chapter 11, USA Gymnastics, its claimants (517), and insurers (11 or 12) have not settled. IMO the BSA Chapter 11 filed Feb, 2020 is more complex, so..

Edited by RememberSchiff
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11 hours ago, RememberSchiff said:

Agreed.

The BSA has filed a motion "extending the Debtors’ exclusive periods to (a) file a chapter 11 plan (the “Exclusive Filing Period”) by 180 days, to and including April 13, 2021, and (b) solicit votes thereon (the “Exclusive Solicitation Period” and, together with the Exclusive Filing Period, the “Exclusive Periods”) by 180 days, to and including June 14, 2021, without prejudice to the Debtors’ rights to seek further extensions of the Exclusive Periods".

And nearly two years after filing Chapter 11, USA Gymnastics, its claimants (517), and insurers (11 or 12) have not settled. IMO the BSA Chapter 11 filed Feb, 2020 is more complex, so..

The Archdiocese of Milwaukee took 4 years to settle.  The benefit is that they only paid out $21M to 330 individuals.  If BSA wants this quick, they will pay more.  If they want to minimize damages, be prepared for years of litigation.  I tend to agree, now that lawyers have victims names, they will proceed to councils and COs that have $$.  Even individuals if they think they have any funds.  

When talking with a lawyer friend recently, I asked him who we would sue.  He said everyone.  Let the courts figure out who pays.  

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1 hour ago, Eagle1993 said:

The Archdiocese of Milwaukee took 4 years to settle.  The benefit is that they only paid out $21M to 330 individuals.  If BSA wants this quick, they will pay more.  If they want to minimize damages, be prepared for years of litigation.  I tend to agree, now that lawyers have victims names, they will proceed to councils and COs that have $$.  Even individuals if they think they have any funds.  

When talking with a lawyer friend recently, I asked him who we would sue.  He said everyone.  Let the courts figure out who pays.  

Which works out to be $63,000 per victim, before attorneys (so, cut that down to $40,000).

As for the lawyer friend who said sue everyone, that is right. If I am an attorney looking out for my client's interests, I am going to find out anyone who may have liability for the bad acts.

That's not "ambulance chasing", that's good lawyering.

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Given the economy, covid, and individual issues, there is the possibility a majority of claimants may instruct their attorneys they need money now  leading to a quicker, smaller settlement.

I have found some settlement loan companies specifically advertising to claimants in this Chapter 11.  I won't post their links.

Some advice from nolo.com

https://www.nolo.com/legal-encyclopedia/pros-cons-lawsuit-loans.html

Even if you need cash, a lawsuit loan might not be a good choice for you. Below are some of the main cons to taking out a lawsuit cash advance.

It is not unusual for personal injury cases to take months or even years to settle or come to trial. The interest rates on a typical lawsuit loan can run between 27% and 60% a year, comparable to some payday loans. On a $25,000 loan, the interest can cost you $12,500 or more in just one year. Because the interest is usually compounded monthly, if the case takes two years to settle, you'll pay back a whopping $32,000 in addition to the $25,000 you borrowed. :eek:

 

Edited by RememberSchiff
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1 minute ago, RememberSchiff said:

Given the economy, covid, and individual issues, there is the possibility  that the majority of claimants may instruct their attorneys that they need money now  leading to a quicker, smaller settlement.

Yes, but I believe you had mentioned in a prior filing the proposed plan requires 90% of claimants to agree.

That's the problem. You only need 10% + 1 to dig in their heels.

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1 minute ago, CynicalScouter said:

Yes, but I believe you had mentioned in a prior filing the proposed plan requires 90% of claimants to agree.

That's the problem. You only need 10% + 1 to dig in their heels.

I stand corrected.

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2 hours ago, CynicalScouter said:

Which works out to be $63,000 per victim, before attorneys (so, cut that down to $40,000).

I saw somewhere they were looking to employ the same person that did 9/11 and the BP settlement. So it could be $63,000 on average, but $5000 for some and $300,000 for others.

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7 hours ago, mrjohns2 said:

I saw somewhere they were looking to employ the same person that did 9/11 and the BP settlement. So it could be $63,000 on average, but $5000 for some and $300,000 for others.

If you are referring to Kenneth Feinberg, he applied to the Court to be a mediator (see link below for his application). He was not selected.

Judge Silverstein decided on a three person mediation panel which includes Paul Finn and Tim Gallagher who were forwarded by the BSA. For the third position, Judge Silverstein did not appoint BSA's third candidate choice rather former bankruptcy judge Kevin Carey.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/823120_773.pdf

Edited by RememberSchiff
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Just received a statement from state annual conference of United Methodist Church regarding child sex abuse. It noted that the BSA has filed for bankruptcy, "which limits their exposure to lawsuits and may increase the church's exposure."  It further adds that the conference leadership in consult with its lawyers as well as conferences around the country is taking "appropriate steps". It additionally notes that the UMC has more scouting programs in its buildings than any other denomination. I guess that's maybe true after the LDS departure. 

It seems a very measured statement but still concerning. 

I haven't yet seen anything like this through Catholic or Lutheran church ties. Has anyone else seen similar statements from them or other religious denominations? 

 

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I have not, but I shared the Baptist link above to my IH/ASM (don't ask, he wants to be an ASM and not the IH/COR/CC). He will be going up through his hierarchy.

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1 hour ago, yknot said:

Has anyone else seen similar statements from them or other religious denominations? 

Yes, but I can't share them with you.

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2 hours ago, David CO said:

Yes, but I can't share them with you.

I've received more information and I see why you said that. I just realized it will put some of us in a conflict of interest situation. 

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