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


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@SiouxRanger  Thank you!  Very helpful.  It is rather arbitrary which is what I had missed before.  My home state was toward the more lenient spectrum but my read of the tea leaves was exactly the opposite where the adherence to the statute of limitations would be rather rigid.  Obviously, my tea leaves and some other person's could be substantially different.  Since predicting even large important elections is tricky, predicting changes in a state is very arbitrary.  Your explanation removes the mystery.

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This is Doug Kennedy, a member of the TCC.  First, I want to thank all of you for your comments over the past 18 months.  Your comments and those in other forums, whether I disagree with them or not,

Scouter.com is not well liked by National and believe me, while we are all scouters, we have various opinions of BSA.  I think if BSA fails, we will help build up a new scouting organization. If you w

Normally I wouldn't discuss user issues, but given his profile pic and signature I'm going to make an exception: Regardless of the impression given by his profile picture and signature line, Cyni

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7 hours ago, SiouxRanger said:

"Don't start a land war in Asia."

“Never get involved in a land war in Asia” and “Never go in against a Sicilian when death is on the line.” I couldn’t resist. Btw, where is the Dread Pirate Roberts when you need him? 🤔

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12 hours ago, Muttsy said:

I know for a fact that people supposedly dead on the statute in bad states are getting 50-100k

So let's game this out.

There are at last count 52000 time barred claims.

We know from the NY experience that approximately 25% of claims become actual lawsuits (5100 claims, 1300 lawsuits filed)

52000*.25= 13000 lawsuits that are "dead on the statute".

At Hartford-type levels ($787,000,000/24000) that's $33,000 a claim or around $430 million.

At Muttsy's $100,000 levels, that's $1.3 billion.

Both numbers are well within the realm of what BSA is offering.

Again, no amount of fantasy or magic is going to make the statute of limitations vanish or somehow convince insurance companies to pay out $1 million dollar claims in states with statute of limitations bars. As even Muttsy has to admit: the best scenario here is $100,000 and even that is a maybe.

I will agree on this point: having been told to expect $1 million dollar settlement offers, victims confronted with the reality of only getting 10% or even 1% of that may just decide to vote against the plan as being insulting, regardless of the reality that the alternative is they were NEVER, EVER going to be getting that.

And that means we are in cram down territory.

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13 hours ago, Eagle1993 said:

The delays are done.  We are now at the start of the beginning of the end.  

Let me stake a claim here (and I am prepared to eat crow on this later).

I agree we are at the start of the beginning of the end. Some iteration of Plan 5.0 will go out for a vote very soon (October-November) and the results posted (November-December).

There is no way Plan 5.0 or any iteration gets 67%. The judge will be left with three choices:

  1. No 67%, order a cram down that includes BSA, the LCs, and the participating COs (LDS at this point). I see this as really, really, implausible.
  2. No 67%, order a cram down that includes BSA only (the "toggle" plan). I see this as the most likely scenario.
  3. No 67%, let the TCC (by now exclusivity is over) send out its plan.

I know that the bankruptcy code allows for multiple plans to be submitted to creditors at the same time, but I do not see there is enough time for the TCC to get its plan out. Maybe if the judge had delayed for 2 weeks, but not now. She seems absolutely intent to get this to a vote and resolution sooner rather than later.

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42 minutes ago, CynicalScouter said:

At Muttsy's $100,000 levels, that's $1.3 billion.

Both numbers are well within the realm of what BSA is offering.

Perhaps I am confused, but BSA isn't offering $1.3B for time barred claims.  They are offering ~$2B for ALL claims.  Given that the non time barred claims are going to be given a much higher payout than time barred claims, I believe the BSA offer for time barred claims will end up being <<<$1.3B.  I think it is too early to really see where this is headed as there are complexities with LDS & LC payouts, but I expect all claims will get much less than any average settlement they would have seen in state court.

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30 minutes ago, CynicalScouter said:

There is no way Plan 5.0 or any iteration gets 67%. The judge will be left with three choices:

 

I see a chance to get 67%

  • Only positive statements about the plan are included in the voting package
  • More claims than we thought are either fraudulent or submitted with minimal care ... claims just looking to get a quick payout of anything.
  •  All claims get the same vote.  I actually think those most impacted will be the non time barred claims that are looking to pursue the issue in state court.  If they get a bigger vote, I see this deal dying.
  • Coalition lawyers have letters allowing them to vote for their claimants

So, I think it is a done deal yet.  It is definitely risky and I would love the TCC to be on board before it goes out to a vote.  Note that even if a vote approves the deal, it could die (for example, if the Purdue Pharma deal is blowing up in appeal  courts, the judge in this case may rethink where this is headed).

I really think BSA should have a negotiated BSA only settlement ready if the grand bargain dies.  I have no idea of the odds of this, but I don't have a good feeling unless the TCC backs the deal.

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2 hours ago, ThenNow said:

“Never get involved in a land war in Asia” and “Never go in against a Sicilian when death is on the line.” I couldn’t resist. Btw, where is the Dread Pirate Roberts when you need him? 🤔

Perhaps the Dread Pirate Roberts is the one to untie the Gordian knot, and since it has been stated the the judge is the person to do the untying, then he would need to be Judge Dredd Pirate Roberts.  😉

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25 minutes ago, MYCVAStory said:

That won't happen.  The TCC will include its recommendation in any packet. 

Won't that be a mess. The Coalition (including many of the victims' own lawyers) are saying "vote yes" and the TCC says "vote no".

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18 hours ago, Muttsy said:

Agree. The Hartford settlement put the lie to there being billions more from carriers. Century Chubb will never pay more one an exposure basis than Hartford. Maybe a billion but that’s it. The Coalition is only in this for their own personal gain. The claimants aren’t stupid. 
 

Get BSA out of the equation and take aim at the others in state court where the balance of leverage shifts. It’s the only way to extract fair value which is on a state by state, council by council, CO by CO basis. 
 

5.0 has no chance. If BSA was smart it would immediately revert to the toggle. Going forward like this is suicidal.  

No, if BSA abandoned the LCs without doing absolutely everything they could to get them covered I suspect it would fundamentally destroy the relationships.  So while going independent might be smart in one sense, in the long run I don't think it would be the best option.

16 hours ago, CynicalScouter said:

But EVEN WITH those, I don't see how you reduce $30-$134 billion to only $2.1-$7 billion. And even if it is that low, why would a victim accept it when they were assured hundreds of thousands if not millions.

Zalkin just said: he's thinking he can settle for millions NOW against Orange County Council and Hartford. Why on earth would he take this deal?

I think any attorney who is thinking in these terms is either an idiot or is dissembling.  Yes, before all the claims got filed an attorney might have been able to get a multi-million dollar settlement out of a Council.  But now that everyone knows there are hundreds or thousands of claims just waiting to be litigated?  Nope.  Paying 3 million for a settlement to get an issue to go away so you can move on is one thing.  Paying 3 million to the first person in a line of a thousand is an entirely different story.  At that point, if the LC sees that the number of people indicates a bankruptcy is in the future, there's no longer any point in paying anyone at full value.

14 hours ago, Muttsy said:

Those laws are being ignored or circumvented. Look at CO and LA. 
Years ago in a political science class, my professor remarked that “nobody’s life or liberty is safe while the legislature is in session.” 
I think a survivor  if presentented with hope or 15k, will choose hope. 

That's a nice thought, but for anyone who actually needs the money, I don't think it's a realistic one.  Something like 40% of Americans are 1 paycheck away from being insolvent and for half of the country that 15k is more than 25% of their annual income.  I'm sure there are plenty who would rather wait and hope for more, but I don't think it'll be a landslide by any means.

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2 minutes ago, CynicalScouter said:

Won't that be a mess. The Coalition (including many of the victims' own lawyers) are saying "vote yes" and the TCC says "vote no".

Yep.  But if you're the coalition it's all part of the game plan.  Collect as many clients as you can.  Fight strict validation.  Control the trust.  Don't communicate with your clients because you don't want to answer the tough questions, and settle QUICKLY.  Why?  Because for every billion in an award fund the coalition attorneys stand to earn before paying off their funders 400 MILLION DOLLARS.  Oh, and the last part of the plan....move on to the next mass tort and repeat.  This isn't an anti-lawyer post.  It's a "how the game is played" post. 

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Official agenda for September 23.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/8295d93f-c841-4c5d-beb8-7edd6cad2b2c_6331.pdf

The first 3 items have been agreed to by stipulation and agreement, including by the TCC, therefore they will likely take about 2 minutes each (Lauria will explain what they are, why all parties agree, and judge will ask for objections. Hearing none, she'll move on). That will leave

  • Debtors’ Motion for Entry of an Order (I) Approving Knight Settlement Agreement and (II)  Modifying  the  Automatic  Stay,  to  the  Extent  Necessary  to  Permit  Payment  of Settlement Amount by Applicable Insurance. (D.I. 6154, filed 9/2/21).
  • Debtors’ Motion for Entry of an Order (I) Approving Romero Settlement Agreement and (II)  Modifying  the  Automatic  Stay,  to  the  Extent  Necessary  to  Permit  Payment  of Settlement Amount by Applicable Insurance. (D.I. 6155, filed 9/2/21).
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15 minutes ago, CynicalScouter said:

Official agenda for September 23.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/8295d93f-c841-4c5d-beb8-7edd6cad2b2c_6331.pdf

The first 3 items have been agreed to by stipulation and agreement, including by the TCC, therefore they will likely take about 2 minutes each (Lauria will explain what they are, why all parties agree, and judge will ask for objections. Hearing none, she'll move on). That will leave

  • Debtors’ Motion for Entry of an Order (I) Approving Knight Settlement Agreement and (II)  Modifying  the  Automatic  Stay,  to  the  Extent  Necessary  to  Permit  Payment  of Settlement Amount by Applicable Insurance. (D.I. 6154, filed 9/2/21).
  • Debtors’ Motion for Entry of an Order (I) Approving Romero Settlement Agreement and (II)  Modifying  the  Automatic  Stay,  to  the  Extent  Necessary  to  Permit  Payment  of Settlement Amount by Applicable Insurance. (D.I. 6155, filed 9/2/21).

I don't think the court got through all of the Plan Disclosure objections.  When will those be covered?  It seems like we have days and days of hearings left just on that.

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Just a quick notice.  There were several comments hidden and others that drifted from the legal aspects of bankruptcy.  Those comments were moved to our other thread.  Given that we will have several hearings this week, it made sense to move those to keep the topics separate and manageable.  

 

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