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Chapter 11 announced - Part 11 - Judge's Opinion


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I have nothing to say that is worthy of much attention, other than I am SOOO VERY grateful for Eagle1993 and his excellent reverse engineering of this opinion, and other such. I, for one, am indebted

Final plan & exhibits were uploaded last night.  Century supports the updates; however, we may see some fireworks with Guam and possibly the judge.   3b0d7c7a-ca0e-4eab-ad84-f43950dc2b65_1029

A flurry of action today: - The Judge approved the BSA/GSUSA agreement to stop suing each other: cd5eb23c-6a2c-4c70-a015-dc989fbfd257_10193.pdf (omniagentsolutions.com) - The US Trustee/DOJ

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23 minutes ago, Eagle1993 said:

From my brief review, it is not an approval; however, not a full rejection.

I concur. It is a very circuitous route for having spent such and enormous amount of time getting to a destination which location is in no way crystal clear. Mud comes to mind. Enjoy. As I go back with a flashlight and tweezer, I will pine for Eagle1993's anticipated outstanding Cliff Notes. Reader's digest version would be totally sufficient, in the alternative. Buckle up people. It's gonna be a bumpy ride, me thinks.

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I need to go back, so don't hold me to this. A few happy notables on the approval side:

"Many survivors have been waiting for thirty, forty or even fifty years to tell their stories and receive a meaningful recovery. This plan makes that happen." (Page 158)
 
"While I understand objectors' strongly held view that they are better off individually if left to their own litigation, this is a mass tort case. There are 82,209 claimants whose views need to be considered, and ... I consider 85% to be overwhelming acceptance." (Page 164)
 
"This is an extraordinary case crying out for extraordinary solutions.... The combination of monetary and non-monetary aspects of the plan are fair to the holders of abuse claims." (Page 168)

 

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Posted (edited)

It is very long!  Will attempt to summarize her findings:

1) She agrees with the Bate's estimate of $2.4 - $3.6B.  

2) She agrees with the insurance expert that potential allocation to solvent non-settling insurance companies is between $321,319,886 and $400,546,854 and total limits of coverage potentially available is $4,295,878,628 and $4,404,844,433.

3) Based upon 1 & 2, the judge concludes that if the plan is confirmed, direct abuse claims will more likely than not be paid in full.

4) She CANNOT approve the $250M contribution from TCJC (Church of Jesus Christ of Latter-day Saints) because, of a release of non-abuse claims.

5) She also excluded contributions from other chartered orgs. for her analysis of #3 as there is nothing to really estimate a contribution

6) She also exlcuded Pachulski Stang's contribution of 10% of fees.

Regardless, she believes direct abuse will be paid in full. ... more coming

 

 

Edited by RememberSchiff
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Posted (edited)

 

7) The settling insurer settlements meet the standard required.  Each insurer met the standard vs Ms. Gutzler's analysis EXCEPT Century.  However, two points.  BSA & Century were litigating coverage before bankruptcy & there is doubt if Century can pay more anyway.  Plus, TCC, Coalition & FCR approved it.  

First Issue:

She cannot approve the sale of abuse insurance policies in Guam.  The Guam bankruptcy court blocked it during the Archbishop bankruptcy there and based on a review of law.  

A win for Lujan & Guam...

Edited by Eagle1993
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A bunch of more objections by Lujan were denied.  So far, (page 120 of 281) there is 1 major issue.  BSA cannot transfer the Guam abuse insurance rights to the debtor until the Guam bankruptcy concludes or that court addresses the issue.  

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She concludes that there is statutory authority to grant third-party nonconsensual releases.  She goes through pages and pages including discussing Dr. Kennedy & Mr. Meidl's moving statements in support of the plan.  In the end, she believes this case the releases are allowed.

Major hurdle cleared here.

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Posted (edited)

She rejects the third party releases for TCJC (Church of Jesus Christ of Latter-day Saints} as they went too far.  That is why she is excluding their $250M settlement as she expects that may change.

 

The issue is TCJC were attempting to clear out mixed claims.  She is ok clearing out pure scouting abuse from TCJC, but mixed claims are a bridge too far.

 

So ... "... I decline to approve the TCJC (Church of Jesus Christ of Latter-day Saints) Settlement."

Edited by RememberSchiff
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Posted (edited)

TDP (Boy Scouts of America Trust Distribution Procedures for Abuse Claims) Findings ...

 ... she will not find the TDPs as "fair and equitable settlement of Abuse claims" as she does not see a need to do this to confirm the plan.

 ... she will not find the TDPs under Historical Consistency Finding.  Again, she doesn't think she needs to do this to confirm the plan.

... she will not find the TDPs under "The Binding Finding" ... unnecessary

...she may agree to "They Allowed Claim Finding" .. however, needs an update

.. she will not find the TPDs under "The Good Faith Finding"

Basically, she is punting the TDPs to future litigation as needed.  Major win for non settling insurers.

 

Edited by RememberSchiff
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She found some issues with post bankruptcy settlements.  Basically, all parties must be notified even if bankruptcy court approval is not sought.  

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"If the plan is confirmed, the confirmation order will provide that the settlement trustee will propose procedures to suss out fraudulent claims taking into account factors she deems appropriate, which can include a cost/benefit analysis.  Those procedures will be presented to the court.  The STAC will have no consent or veto rights over these procedures.  In addition to disallowance of a claim, penalties may include seeking prosecution of the claimant or claimant attorney for representing a fraudulent claim."

She seemed VERY upset over what she herd with claim approvals.  Basically, if she confirms the plan, before any payouts, she wants to see how the trust will vet claims.

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Very minor change required ... "Given the Debtor's intent, the word "negligence" should be added to Art. VII.C.2(c)".  Other than that, certain insurer's objections are overruled and she finds the plan in good faith.

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Independent fees ... in general , the judge approves the $20K in fees.  However, she wants the following change.  If the settlement trust doesn't waive the fee and the claimant is not happy, they can go to the bankruptcy court for review.

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1 hour ago, Eagle1993 said:

Well, we have an opinion on the docket.  From my brief review, it is not an approval; however, not a full rejection.

https://casedocs.omniagentsolutions.com/cmsvol2/pub_47373/9ba8739e-283b-4ce4-b328-5a1eda289f30_10136.pdf

Please keep the discussion civil.  

Judge Accepts Most of Boy Scouts Bankruptcy Plan to End Biggest Sex-Abuse Case

Judge shoots down some insurer objections and requests more plan information from the youth group

https://www.wsj.com/articles/judge-accepts-most-of-boy-scouts-bankruptcy-plan-to-end-biggest-sex-abuse-case-11659126315?mod=newsviewer_click

Unfortunately most of article is behind a paywall.

Edited by RememberSchiff
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