Chapter 11 Announced - Part 6 - Plan 5.0/TCC Plan TBD

[Eagle1993 2160]

2 hours ago, johnsch322 said:

If this became a BSA National only Chapter 7 then all claimants will still get their share from BSA National.  It would be less but not nothing.  On the other hand, many local councils will find themselves in bankruptcy themselves and as more states allow claims to filed more LC's over time will face bankruptcy.

I don't see this going CH7.  I could see this going BSA National CH11.

[DayNoomp72 1]

4 minutes ago, Eagle1993 said:

Welcome to Scouter.com!

Thank you. Is there a bankruptcy dictionary? Sheesh.

[Eagle1993 2160]

1 hour ago, DayNoomp72 said:

What about the pension fund? Doesn’t it get preference or whatever the term is? 

One strategy, which the court hasn't really ruled on, is the following path.

1) Keep fighting National BSA until they simply cannot afford CH11 and they then volunteer to go CH7.

2) Court appoints a group of trustees to run BSA.  Their job, just like all Ch7, is to maximize value for all claimants.

3) That group of trustees then pulls 100% of charters from all LCs.

4) Per LC/National charter agreements, once a charter ends, all LC assets are turned over to National.

5) Bankruptcy court liquidates the entire organization, and has 10B or so in assets.

First ... I doubt the whole LC thing could/would happen, so I'll ignore that.

Second ... with a National only CH7 case, yes, the pension fund would be in line.  The national pension board will ask for $XB.  However, they are an unsecured creditor ... so, they will be placed in other groups of claimants.  They are not necessarily fully funded before claimants.  That is why those with pensions typically see pension cuts post CH7.

I HIGHLY doubt National goes CH 7.  Even if the doomsday scenario above doesn't happen (which I doubt it could), going CH 7 means you lose total control.  Everything is simply sold, including all trademarks.  

[RandomScouter 29]

1 hour ago, DayNoomp72 said:

I’m new. Can you explain what you mean?

What about the pension fund? Doesn’t it get preference or whatever the term is? 

Hello, DayNoomp.  Welcome to the forum.   

[DayNoomp72 1]

3 minutes ago, RandomScouter said:

Welcome to the forum

Ty

[johnsch322 524]

43 minutes ago, Eagle1993 said:

CH7

My bad I meant a standalone BSA only chapter 11

[DayNoomp72 1]

22 hours ago, johnsch322 said:

So when I am looking at Los Padres (California) with 83 claims with a low range of liability at $31,875,500 and high range at $144,323,500 and $14,453,991 in unrestricted assets contributing $1,834,155 or 12.7% of net unrestricted assets 

VS

Ventura Council (California) with 84 claims with a low range of liability at $30,178,500 and high range at $136,510,500 and $1,437,344 in unrestricted assets contributing $325,108 or 22.6% of net unrestricted assets 

 

If some local councils get sued by all these victim claimants where the number of survivors is high don’t people end up getting less? More that i can’t make sense of. Do you know how many people would be in line to get law suit payments in those councils and how much they have in assets? Probably need to have the liability insurance details too. This is a disaster. I guess lawyers and CPAs are in hog heaven. Maybe i just watch from the peanut gallery until the struggle plays out to meet my level of what makes sense to me. Anyone got some info or was that to hard to follow?

[vol_scouter 365]

1 hour ago, Eagle1993 said:

One strategy, which the court hasn't really ruled on, is the following path.

1) Keep fighting National BSA until they simply cannot afford CH11 and they then volunteer to go CH7.

2) Court appoints a group of trustees to run BSA.  Their job, just like all Ch7, is to maximize value for all claimants.

3) That group of trustees then pulls 100% of charters from all LCs.

4) Per LC/National charter agreements, once a charter ends, all LC assets are turned over to National.

5) Bankruptcy court liquidates the entire organization, and has 10B or so in assets.

First ... I doubt the whole LC thing could/would happen, so I'll ignore that.

Second ... with a National only CH7 case, yes, the pension fund would be in line.  The national pension board will ask for $XB.  However, they are an unsecured creditor ... so, they will be placed in other groups of claimants.  They are not necessarily fully funded before claimants.  That is why those with pensions typically see pension cuts post CH7.

I HIGHLY doubt National goes CH 7.  Even if the doomsday scenario above doesn't happen (which I doubt it could), going CH 7 means you lose total control.  Everything is simply sold, including all trademarks.  

It is very doubtful that the assets of the independent local councils would ever go to national.  Our council would not agree to that and our state's attorney general will fight the transfer of any council's assets within our state.  We could pivot to a youth service organization and continue a youth service mission.

The way in which you wrote the above sounds like the court is fighting the BSA which is not the case.  The court should be committed to preserving the BSA while adjudicating the bankruptcy and the judge has said that in her comments.

The state court lawsuits will drag on for many more years and many claimants will see nothing as most are statute of limitation barred.

There is not $10 B in assets in the whole of the BSA Scouting.  

[Eagle1993 2160]

37 minutes ago, vol_scouter said:

It is very doubtful that the assets of the independent local councils would ever go to national.  Our council would not agree to that and our state's attorney general will fight the transfer of any council's assets within our state.  We could pivot to a youth service organization and continue a youth service mission.

The way in which you wrote the above sounds like the court is fighting the BSA which is not the case.  The court should be committed to preserving the BSA while adjudicating the bankruptcy and the judge has said that in her comments.

The state court lawsuits will drag on for many more years and many claimants will see nothing as most are statute of limitation barred.

There is not $10 B in assets in the whole of the BSA Scouting.  

I agree, but there are state councils who filed objections to the plan referencing the steps I listed.  I don't see this happening and BSA can completely avoid the question by staying in Chapter 11.  If they enter Chapter 7, this will become a question that will have to be answered.

The court will need to follow applicable law.  They call balls/strikes.  They must ensure BSA has a business plan that can succeed WHILE getting agreement from creditors.  I'm not sure what I wrote that stated the court is fighting the BSA.  Now ... to be fair .. the DOJ is absolutely fighting this plan, but they are not the court.

Agree about the $10B but there are those claiming that (I don't know what that is based on).  Per BSA's numbers, assets are in the $5B range if they had to be liquidated.

Again, this will not happen, but there are those who are pushing this path.

[1980Scouter 99]

1 hour ago, vol_scouter said:

It is very doubtful that the assets of the independent local councils would ever go to national.  Our council would not agree to that and our state's attorney general will fight the transfer of any council's assets within our state.  We could pivot to a youth service organization and continue a youth service mission.

The way in which you wrote the above sounds like the court is fighting the BSA which is not the case.  The court should be committed to preserving the BSA while adjudicating the bankruptcy and the judge has said that in her comments.

The state court lawsuits will drag on for many more years and many claimants will see nothing as most are statute of limitation barred.

There is not $10 B in assets in the whole of the BSA Scouting.  

I respect your dedication to BSA but you have to realize that for a plan to be approved every entity has to be all in. This includes money and future youth protection.  

We are not there now and it will take all entities increasing their contribution and youth protection changes to satisfy the TCC and others. 

This could occur and BSA could go on their merry way. But this is a very complicated case with so many objections by many. 

I agree that a BSA only may be the way to go. Get maximum from BSA and insurance including some HA bases. Then go after LC on a council by council basis. This would likely settle national BSA much faster.

You are correct in some LC do not have much more to contribute, but most do have a lot more they could contribute. 

Edited December 17, 2021 by 1980Scouter
Typo

[elitts 464]

5 hours ago, MattR said:

Another question: why doesn't the doj declare the plan illegal now?

Executive branch agencies don't get to determine the legality of the court's actions.  They can say they think it's illegal, but it's just an opinion.

5 hours ago, johnsch322 said:

If this became a BSA National only Chapter 7 then all claimants will still get their share from BSA National.  It would be less but not nothing.  On the other hand, many local councils will find themselves in bankruptcy themselves and as more states allow claims to filed more LC's over time will face bankruptcy.

Personally, I think the movement has pretty well passed on wide open expansions of SoL laws.  We'll probably see states that restrict the SoL at very short times get widened, but I think the BSA case has shown everyone who's paying attention that permitting 70 years worth of complaints to suddenly be filed isn't healthy for ANY long standing organization.

13 minutes ago, 1980Scouter said:

I respect your dedication to BSA but you have to realize that for a plan to be approved every entity has to be all in. This includes money and future youth protection.  

We are not there now and it will take all entities increasing their contribution and youth protection changes to satisfy the TCC and others. 

This could occur and BSA could go on their merry way. But this is a very complicated case with so many objections by many. 

I agree that a BSA only may be the way to go. Get maximum from BSA and insurance including some HA bases. Then go after LC on a council by council basis. This would likely settle national BSA much faster.

You are correct in some LC do not have much more to contribute, but most do have a lot more they could contribute. 

Except that's not how it will work. 

Here's my prediction if the a BSA only bankruptcy is the final result:

The HA bases are fully encumbered and/or restricted; there's no more money to be had there, so there's no more national money available.  The BSA national insurance policies are going to be tapped out, so there won't be any more funds from them.  And since this bankruptcy has taken as long as it has, every LC that doesn't have it's head buried completely will have had plenty of time to protect any camp they really want to keep from bankruptcy.  Bankruptcy courts can only go back a limited number of years (2-4 in most cases) to recover distributed assets.  So if the LCs have attorneys actually doing their jobs, they started transferring property into trusts the second things ballooned into the massive issue we have today.  If we assume another 6 months or so of national BSA bankruptcy, the LCs will only need to avoid bankruptcy for 6-18 months before they can file bankruptcy without running afoul the look-back windows on the transfers of the camps.  And once that's done, they can file chapter 11 without having to lose more than any cash on hand.

[Eagle1993 2160]

38 minutes ago, elitts said:

And once that's done, they can file chapter 11 without having to lose more than any cash on hand.

No chance this happens.

[Eagle1993 2160]

1 hour ago, 1980Scouter said:

I respect your dedication to BSA but you have to realize that for a plan to be approved every entity has to be all in. This includes money and future youth protection.  

We are not there now and it will take all entities increasing their contribution and youth protection changes to satisfy the TCC and others. 

This could occur and BSA could go on their merry way. But this is a very complicated case with so many objections by many. 

I agree that a BSA only may be the way to go. Get maximum from BSA and insurance including some HA bases. Then go after LC on a council by council basis. This would likely settle national BSA much faster.

You are correct in some LC do not have much more to contribute, but most do have a lot more they could contribute. 

I think @vol_scoutermay be correct ... one cannot dismiss the chance that net/net, the current plan may end up giving the average claimant the highest settlement.  I also think @vol_scouter is correct in that it will be tough to get a much larger settlement from LCs across the board.  Perhaps some LCs can provide an increase, but if the need is 2x or 3x ... at that point, LCs will probably just rather take the risk in state courts.  If there is an LC by LC discharge option, and that money goes to the specific council claimants, there is a chance some stay within the National bankruptcy.

[johnsch322 524]

2 minutes ago, Eagle1993 said:

I think @vol_scoutermay be correct ... one cannot dismiss the chance that net/net, the current plan may end up giving the average claimant the highest settlement.  I also think @vol_scouter is correct in that it will be tough to get a much larger settlement from LCs across the board.  Perhaps some LCs can provide an increase, but if the need is 2x or 3x ... at that point, LCs will probably just rather take the risk in state courts.  If there is an LC by LC discharge option, and that money goes to the specific council claimants, there is a chance some stay within the National bankruptcy.

The biggest increase will come from the insurance companies when the current plan is rejected. I think the LC’s will have to double the amount committed and it won’t be tied to membership increases payable in 2035 (that part is pretty insulting). 

[1980Scouter 99]

I would like to add all who have been following this case closely have their ideas where this is going and that is good as there are many different options. 

In the end this case could go anywhere. It could be dismissed, approved as submitted or anything in between. It is sad that it took two years to get where we are now. The longer it drags on the worse for the future of the BSA.

If I only had a time machine, I could be the hero of this forum.