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


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Here is one other item from the TCC that wasn't 100% clear to me last week and I don't think was 100% clear to anyone else.

The Hartford $787 Million is NOT dedicated to victims covered by Hartford years/policies but goes to ALL claimants.

Quote

Because the $787 million is not being dedicated to claims that trigger Hartford’s policies, the $787 million will yield approximately $8,500 per survivor after accounting for trust expenses and overhead.

The LDS $250 million will go ONLY to LDS victims.

Quote

The TCJC settlement funds will only be distributed to survivors who have claims against TCJC which may result in additional distributions only to them.

So, that means if you are a non-LDS survivor, the offer is

$1.88 billion - $250 million (LDS only) = $1.63 billion / 82500 = $19,757 (average)

If you and LDS survivor, you get (on average) $19757 + $100,000 ($250 million / 2500 LDS claimants) for a total of around $120,000 on average.

Edited by CynicalScouter
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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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A few observations: 

They're now haggling. The result will be somewhere between the extremes. If @CynicalScouter is correct it will be between $0.5B and $1.5B from the councils.

Next, the discussion about how much a council needs is not quantitative and I wonder if that has to do with the notorious lack of transparency. 

Finally, I don't see any teamwork between councils. I'm not sure if that's the plan or if it's even possible given all the complexity, but if it continues this way then the poorer councils will just get more so. 

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1 hour ago, CynicalScouter said:

"Certain Excess Insurers" are submitting their proposed confirmation schedule based on what the judge (verbally) directed.

Rather than putting in specific dates (December 9, October 15, etc.) they laid out a formula (150 days after X, then Y).

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/dad63f9f-ccb6-42d5-8cd7-527a885bf7fb_6367.pdf

Based on their math, the earliest for a plan confirmation is 182 days after the disclosure hearing.

If the disclosure hearing is 9/28/2021, that means the earliest for a confirmation hearing is 3/29/2022.

And remember: BSA is NOW saying it's out of cash by that point (1Q 2022).

The insurance companies want to drag this out so I don't necessarily believe their timeline, but I have to agree the BSA schedule is very aggressive unless 100% of parties are in alignment and the hearings are essentially rubber stamps outside a few objections.  With the TCC and many claimant attorneys not on board in addition to most COs & insurance companies ... I just do not see how BSA's timeframe is met.

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35 minutes ago, CynicalScouter said:

If you and LDS survivor, you get (on average) $19757 + $100,000 ($250 million / 2500 LDS claimants) for a total of around $120,000 on average.

Oh, joy. Oh, rapture. Wrong state. Wrong church. Wrong turn at Albuquerque and “definitely not wearing my underwear.” (Nod to Raymond, aka, Rainman.)

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TCC throws down the gauntlet.

They are demanding that all 82,500 be IMMEDIATELY classified for voting purposes, and quote the judge back at her. And BSA apparently made a Sunday night shift in its view of voting.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/375adbf4-92db-4a41-b164-2ecfb1fcc7ce_6368.pdf

Quote

Late in the day on Sunday, September 26, after the Debtors acknowledged to the
Court that it was essential to have this very information as part of the voting report for
consideration at the confirmation hearing, the TCC learned that the Debtors intended to make a
sudden about-face. Presumably to avoid this Court’s scrutiny of a critical confirmation issue that
they recognized just days ago, the Debtors now intend to have Electing Abuse Claimants, who
are in a fundamentally different position than non-Electing Abuse Claimants, make the election
to receive an Expedited Distribution after the Plan goes effective

So this means that the BSA seek to allow those opting for $3500 to vote, swamping the claims of all others.

The TCC is calling this voting diluting and manipulation (pages 9-10).

The TCC now wants the court to order BSA to divided claimants into two groups the order would

Quote

directing the Debtors (a) to amend the Plan to establish two separate classes of Direct Abuse Claims, as follows: (i) Electing Abuse Claims, and (ii) Non- Electing Abuse Claims, (b) include on any Ballot sent to Direct Abuse Claimants an election concerning whether such Direct Abuse Claimant voluntarily agrees to receive an Expedited Distribution, and (c) for such other and further relief as is just and proper under the circumstances.

 

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The resulting split would as I read it result in needing two-sets of 2/3rds votes.

  1. 2/3rds of all claimants WHO ARE JUST OPTING FOR $3500
  2. 2/3rds of all claimants WHO ARE OPTING FOR THE SETTLEMENT TRUST SYSTEM

And they want the motion heard tomorrow (it technically says September 21, but that's because I believe tomorrow's hearing is the adjournment of the September 21 hearing)

Edited by CynicalScouter
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1 minute ago, CynicalScouter said:

TCC throws down the gauntlet.

They are demanding that all 82,500 be IMMEDIATELY classified for voting purposes, and quote the judge back at her. And BSA apparently made a Sunday night shift in its view of voting.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/375adbf4-92db-4a41-b164-2ecfb1fcc7ce_6368.pdf

So this means that the BSA seek to allow those opting for $3500 to vote, swamping the claims of all others.

The TCC is calling this voting diluting and manipulation (pages 9-10).

The TCC now wants the court to order BSA to divided claimants into two groups the order would

 

Beat me by 1 minute on posting this update.  I think this is a HUGE deal.  If the judge allows this, BSA may be screwed and realize the vote is likely to fail.  I wonder if the judge rules in favor if BSA asks for a pause on the plan to renegotiate.  I see 0% chance that those who don't take the $3,500 quick pay out vote.

While it is likely they get 100% of those votes who simply want the fast payout, they would need at least 66% of the votes of those who want a full settlement.  

It sounds like the judge agreed to this (as did BSA) during the hearing.  Now BSA lawyers are probably realizing the impact.

This could be a non issue if the judge denies the request.... so we should know tomorrow as it can't be put off until confirmation of the plan.

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1 hour ago, CynicalScouter said:

That is where this may differ. For example, some councils are so small/broke that doubling or tripling their contribution would effectively put them under. But you have a LOT of larger councils who are paying, in effect, peanuts.

Just look at the 10 largest councils by total assets (according to BSA numbers). Only Greater Cascade is over the national average of 14%. Greater Los Angeles is close. The others are coming in way under.

Local Council Name

 

Total Assets

 

% of Total Assets Towards Contribution

 

SAM HOUSTON AREA

179,837,619

4.43%

NORTHERN STAR

99,707,945

7.24%

GREATER ST. LOUIS AREA

96,778,145

8.25%

ATLANTA AREA

95,546,679

8.37%

CIRCLE TEN

92,482,329

8.64%

MICHIGAN CROSSROADS

67,087,721

11.90%

DENVER AREA

58,634,253

10.23%

CASCADE PACIFIC

56,027,991

17.85%

CROSSROADS OF AMERICA

55,507,464

7.79%

GREATER LOS ANGELES

55,232,268

14.48%

Doesn't this table reflect chance of being sued?  I'm sure there are other factors too (number of victims), but most of these councils have closed SOL liabilities.  ... most ... 

  https://childusa.org/wp-content/uploads/2020/05/WindowsRevival-Laws-for-CSA-Since-2002.pdf

  • Closed
    • Sam Houston Area - Texas - Closed.  No revival for expired SOLs.  Probably won't have one
    • Northern Star - Minnesota - Closed.  Three year revived SOL lookback window expired in 2016.  
    • Greater St. Louis - Missouri - Closed.  No open lookback window
    • Atlanta - GA - Closed.  Opened window 2015 - 17.  
    • Circle Ten - Texas - Closed
    • Michigan Crossroads - Closed - Had 90 day window for Larry Nassar claims.  Then closed again.  
    • Crossroads of America - Indiana - Closed
    • Cascade Pacific - Washington - Closed
  • Open/Opening
    • Denver Area - Colorado - Opening - Time window ... Not sure how to interpret their "new cause of action" law.  Different than revived SOL
    • Los Angeles - CA - Open

It's not life changing for each victim ... avoiding lawyer comment ... it is still millions extracted from each LC that may not have a open fear of liability.  

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18 minutes ago, Eagle1993 said:

It sounds like the judge agreed to this (as did BSA) during the hearing. 

Yep. This is what the judge said/warned (emphasis mine)

"And what I'm going to be giving thought to, and I'm sure it's going
to come up in other aspects of this, is can we take a vote so that at
confirmation, challenges of whatever nature people want to raise,
there's an ability to do so and have a vote that we can look at to
apply those challenges to. So that's what I'm trying to think about,
as well, as we go through this process.


For example, there is challenge to the $3,500 expedited
distribution and questions about whether that is going to sway the
vote and whether it should. Well, we're going to know the answer
to that question when we get the vote and whether the votes of the
survivors who choose the $3,500 distribution swing the class
.
We'll know that. There are things we can know once we see the
vote and who's voted."

 

 

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20 minutes ago, Eagle1993 said:

This could be a non issue if the judge denies the request.... so we should know tomorrow as it can't be put off until confirmation of the plan.

My guess is she'll say "lets just wait for the votes to come in and find out then."

Remember: don't adjudicate what doesn't need to be adjudicated.

  • If the plan fails to get 2/3rds even with the $3500 payout folks, it's dead. No need to worry about it.
  • If it succeeds with 2/3rds the $3500 payout folks AND the 2/3rds of non-$3500 payout folks, it lives (it could be killed for other reasons of course)
  • If if succeeds with 2/3rds of the $3500 payout folks BUT FAILS to get 2/3rds of the non-$3500 payout folks, then she has to rule.

 

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31 minutes ago, Eagle1993 said:

The TCC is calling this voting diluting and manipulation (pages 9-10).

I should note that the Insurance companies have also called this plan vote diluting and manipulation as well (they even called it bribery) to induce claimants to take the money and run and vote for a plan that would never get approved without it.

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19 minutes ago, CynicalScouter said:

If it succeeds with 2/3rds the $3500 payout folks AND the 2/3rds of non-$3500 payout folks, it lives (it could be killed for other reasons of course)

The question is .. how will she know which individuals plan to take the $3500.  It sounds like BSA doesn't want to know that until plan approval.  You need to know that before plan approval.  So the ballot must include that info.

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36 minutes ago, fred8033 said:

Denver Area - Colorado - Opening - Time window ... Not sure how to interpret their "new cause of action" law.  Different than revived SOL

The Colorado constitution prohibits laws allowing for the reopening of civil statute of limitation windows retroactively, but can do prospectively. Meaning any abuse that took place PRIOR to the law's enactment operates with the OLD statute of limitations. Any abuse that took place AFTER the law's enactment operates with the NEW statute of limitations.

 

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3 minutes ago, Eagle1993 said:

The question is .. how will she know which individuals plan to take the $3500.  It sounds like BSA doesn't want to know that until plan approval.  You need to know that before plan approval.  So the ballot must include that info.

The BSA since at least Plan 2.0 intended the ballot to have an option for "Accept the plan AND I'll take the expedited payment".

Here was the language in Plan 5.0

Quote

Pursuant to Article III.B.10 of the Plan, each holder of a properly completed non-duplicative proof of claim asserting a Direct Abuse Claim who filed such Claim by the Bar Date or was permitted by a Final Order of the Bankruptcy Court to file a late claim may elect on his or her Ballot to receive an Expedited Distribution, in exchange for a full and final release in favor of the Debtors, the Related Non-Debtor Entities, the Local Councils, Contributing Chartered Organizations, and the Settling Insurance Companies. Under the Plan, “Expedited Distribution” means a one-time Cash payment from the Settlement Trust in the amount of $3,500.00, conditioned upon satisfaction of the criteria set forth in the Trust Distribution Procedures.

 

Edited by CynicalScouter
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9 minutes ago, CynicalScouter said:

The BSA since at least Plan 2.0 intended the ballot to have an option for "Accept the plan AND I'll take the expedited payment".

Here was the language in Plan 5.0

 

If the ballot will collect this info then I agree they will push this to reviewing the vote/plan confirmation.

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