Boy Scouts Bankruptcy
Boy Scouts File for Bankruptcy: On February 18, 2020, the Boy Scouts filed for Chapter 11 bankruptcy as a result of lawsuits brought by survivors of childhood sexual abuse. We had filed many of those lawsuits on behalf of our clients and we will be actively involved with the bankruptcy proceedings. Here are links to some of the bankruptcy filings:
- Chapter 11 Bankruptcy Petitions: These are the two petitions that the Boy Scouts filed to start the bankruptcy. They contain an incomplete list of the Boy Scouts’ assets and creditors. You can read the petition for the Boy Scouts of America by clicking here, and you can read the petition for a related corporation, Delaware BSA, LLC, by clicking here.
Interviews Regarding the Boy Scouts Bankruptcy: Some of our clients have decided to speak out regarding the Boy Scouts bankruptcy and what it means to them. Our lawyers have also been featured in a number of news stories about the bankruptcy because of our long history of helping Boy Scout abuse survivors and our work in a large number of the Catholic bankruptcies. You can read or watch some of the stories by clicking on the links below:
- “Boy Scouts of America files for bankruptcy. Hundreds of sexual abuse lawsuits are now on hold” (CNN)
- “Boy Scouts seek bankruptcy, urge victims to step forward” (AP)
- “Boy Scouts of America files for bankruptcy amid sexual abuse lawsuits” (CBS)
- “Boy Scouts of America files for bankruptcy after sex abuse lawsuits” (Fox News)
- “Boy Scouts of America files for bankruptcy amid wave of potential lawsuits” (Washington Post)
- “Why the Boy Scouts Are Bankrupt and What It Means For Families” (Yahoo News)
What Does the Bankruptcy Mean for Abuse Survivors?
Below are answers to commonly asked questions by abuse survivors. Most importantly: if you were abused by a Scout leader please know a “bankruptcy” only means the Boy Scouts are facing so many lawsuits that they need a bankruptcy judge to decide a fair way to divide their substantial assets and insurance among the abuse survivors who file claims. A “bankruptcy” does not mean abuse survivors will receive no compensation if they file a claim. Some reports state the Boy Scouts have more than $1 billion in assets that may be available to compensate abuse survivors, plus their insurance. In order to quality for compensation you must file a claim with the bankruptcy court and you will likely need to file a claim by a “bar date” deadline that is set by the bankruptcy judge. The deadline may be significantly shorter than the time you would otherwise have to file a claim under state law, which we believe is one of the reasons the Boy Scouts have filed for bankruptcy.
If you or someone you love was sexually abused by a Scout leader or someone associated with the Scouts please contact us to learn your options and to ensure your rights are protected.
Frequently Asked Questions
How Does a Bankruptcy Work for for Abuse Survivors?
Some of our lawyers have represented abuse survivors in a number of the Catholic bankruptcies, including the bankruptcies of the Christian Brothers, the Jesuits in the Northwest, the Diocese of Spokane, the Archdiocese of Milwaukee, and others, so the information on this page is based on our experience in those past bankruptcies. Please know what has happened in the past is no guarantee of what will happen with the Boy Scouts’ bankruptcy, but it will give you some sense of the common issues raised by these bankruptcies that involve abuse survivors.
Most importantly, a bankruptcy does not mean the Boy Scouts have no assets or that abuse survivors will automatically get nothing. To the contrary, the goal of a bankruptcy is to allow a bankruptcy judge to marshal the Boy Scouts’ cash, other assets, and insurance, and then ensure that abuse survivors are compensated in a way that is fair to everyone.
However, in order to be compensated, abuse survivors must file a claim in the bankruptcy by a court-ordered deadline or they will forever forfeit their right to pursue a claim or compensation from the Boy Scouts. This deadline may well be shorter than the length of time allowed for by state law, including the “window” legislation recently passed in California, New York, and New Jersey that provides abuse survivors with one or more years to file a claim regardless of their current age. For that reason it is critically important that abuse survivors contact a lawyer to learn their legal options and timely file a claim.
Why Did the Boy Scouts File for Bankruptcy?
The Boy Scouts of America filed for bankruptcy in order to seek relief from the dozens of child sexual abuse lawsuits filed against it after statute of limitations reform in a number of states, including California, New York, and New Jersey. We filed many of the first lawsuits against the Boy Scouts in those states.
By filing for bankruptcy, all lawsuits against the Boy Scouts are “stayed” (put on pause) and a bankruptcy judge is assigned to oversee all of the claims against them. Generally speaking, the bankruptcy judge is responsible for determining the Boy Scouts’ assets that are available to compensate abuse survivors, including cash, property, and insurance, and then deciding a fair way to use those assets to compensate abuse survivors.
Doesn’t the Bankruptcy Mean the Boy Scouts Have No Assets?
The bankruptcy absolutely does not mean that the Boy Scouts have no assets or that abuse survivors will automatically receive no compensation. Instead, the purpose of a bankruptcy is to ensure that the Boy Scouts’ assets are fairly divided among its creditors, including survivors of sexual abuse who file claims in the bankruptcy. The first step in the bankruptcy is to determine what assets the Boy Scouts have to compensate abuse survivors, including cash, property, and insurance .
Why Should I File a Claim?
People with any type of claim against the Boy Scouts need to know about the “bar date” deadline that will likely require all people with claims against the Boy Scouts, including sexual abuse survivors, to file a claim with the bankruptcy court. This deadline is called a “bar date” because people who come forward after the deadline are usually “barred” from ever filing a claim against the entities that declared bankruptcy. The “bar date” deadline may also extend to other entities who participate in the bankruptcy, such as the local councils and sponsoring organizations.
The bankruptcy judge has not yet set a “bar date” for the Boy Scouts’ bankruptcy, but these deadlines can be as short as 3-4 months from when an entity files for bankruptcy. As you may know, some states recently passed new laws that give all abuse survivors, regardless of their current age, a certain amount of time to file a civil lawsuit for the abuse they suffered. However, the “bar date” would likely be much, much shorter. If you were abused and have a claim against the Boy Scouts, this means your deadline for filing a claim may be significantly shorter — the deadline could be as short as a few months.
If you have a claim against the Boy Scouts, or anyone associated with the Boy Scouts, the time to act is now. Please contact us to learn how to protect your rights.
Does This Mean the Boy Scouts Will Automatically Shut Down?
No. There have been 20 Catholic bankruptcies across the United States, and one of the lead Catholic attorneys is now on record as admitting that the Catholic church has not had to shut down parishes or schools, or reduce their services, as a result of these bankruptcies. For example, most Catholic Dioceses own a significant amount of property, and rather than sell their property, they take out a loan against their property to help compensate abuse survivors. Moreover, insurance companies have contributed a significant amount toward the prior bankruptcies, such as an insurance company that paid more than $100 million toward the bankruptcy of the Jesuits. It is too early to tell how this bankruptcy will affect the Boy Scouts, but keep in mind that their membership numbers have been dwindling for many years.
Are Other Entities Involved, Like the Local Councils and Sponsoring Organizations?
If you have a claim against the Boy Scouts, you may also have a claim against other entities, such as the local council and the organization who sponsored your Troop. This is another reason why it is important that abuse survivors act now and take steps to learn their options.
What Do I Need to Do to File a Claim in the Bankruptcy?
Please contact us and we can explain the process for filing a claim in the bankruptcy. In every bankruptcy you begin the process by filing a short “claim form” that advises the bankruptcy court of your claim. To date, the bankruptcy court in every Catholic bankruptcy has protected the identity of abuse survivors from being publicly known. The bankruptcy court will decide how abuse survivors should be compensated, but most Catholic bankruptcies have involved each abuse survivor submitting a 4-5 page statement, with a neutral third party then reviewing the statement of each person to decide how much they should receive out of the available assets.