They called it a variety of terms: “Disgraceful.” “Offensive.” “A cruel injustice.” But all of them meant the same thing: Unacceptable.
The long-awaited Chapter 11 reorganization plan from the Boy Scouts of America (BSA), filed late Monday in a federal court in Delaware, drew harsh criticism, even anger Tuesday from Seattle lawyers who collectively represent thousands of clients among some 85,000 men and boys who’ve filed sexual abuse claims against the national group as part of its ongoing bankruptcy case.
“After a year, this is what they’ve come up with?” scoffed Tim Kosnoff, a Seattle trial lawyer among a team of firms representing about 17,000 abuse claimants nationwide. “What a colossal waste of time and justice for these victims. I am so angry, but not at all surprised.”
The Boy Scouts of America’s national council, in a press statement Tuesday, acknowledged there are “still many aspects of the Plan that we are refining through ongoing mediation,” but described Monday’s filing as “an important step in demonstrating progress that we believe will ultimately lead to a final plan that the Bankruptcy Court will confirm.”
Obtaining such confirmation, at least in the plan’s current form, appears to be far-fetched. The plan, which would require approval from two-thirds of claimants to be confirmed, offers an average payout of about $6,000 per abuse survivor and would require them to drop any pending or future claims.
“I would be shocked if any claimant or any claimant’s attorney would support this plan,” said Michael Pfau, who, with Seattle law partner Jason Amala, is part of a team representing more than 1,000 claimants, including about 50 in Washington.
The Irving, Texas-based Boy Scouts of America, which serves as the national umbrella organization for more than 250 local councils nationwide, filed for bankruptcy protection in February 2020 amid flagging membership rolls and a flood of existing and anticipated legal claims as states loosened statutes of limitations for sex abuse cases.
In all, about 95,000 claims from some 85,000 individuals were filed in the bankruptcy case by a November deadline, making it by far the largest legal reckoning for sex abuse in the nation’s history, according to plaintiffs’ attorneys.
The national group had sought to shield local councils from the bankruptcy, but Monday’s filing said it now expects local groups nationwide would voluntarily contribute up to $300 million into a settlement trust fund. The plan doesn’t specify which councils would pay into the fund or how much.
The national group also would kick in a string of other assets, including a collection of Norman Rockwell paintings, a warehouse in North Carolina, the rights to a Scouting University property in Texas, oil and gas interests in several states and any unrestricted cash above a $75 million minimum, according to the plan.
All told, that’s roughly $500 million earmarked to settle 85,000 claims — or about $5,882 per claim — in exchange for forfeiting any future legal claims against any national or local BSA groups.
“They think these victims are going to roll over for what you’d pay to resolve a fender-bender for the kind of lifelong trauma they’ve experienced,” Kosnoff said. “It’s just completely detached from reality.”
The plan also is short on financial details, the lawyers said. It fails to give an accounting of local council assets or address how their sponsors and an estimated $1 billion of collective insurance coverage factor into the bankruptcy case.
“The Boy Scouts are still hiding their files on thousands of alleged perpetrators, and now they are trying to hide these basic details that people need to know to make sure they are getting a fair deal,” said Ralph Morse, one of Pfau’s clients, who filed a claim for abuse by his scout leader in New York between 1964 to 1968. “The only thing that is clear is that BSA has no real interest in being held accountable.”
For more than 100 years, the BSA has documented cases of sexual deviancy in scouting ranks, keeping so-called “perversion files” — internal records that tracked and, in theory, aimed to weed out suspected pedophiles. Such files typically reveal how both national and local scouting groups, as well as the churches and other groups that sponsored them, knew about the potentially dangerous predators within their ranks, lawyers said.
The BSA destroyed many of the files or otherwise concealed them over the years, the lawyers said, but some were disclosed in 2012 under an Oregon Supreme Court ruling. They revealed more than 7,800 names of suspected pedophiles that spurred lawsuits nationwide. Among them were at least 38 scouting officials in Washington, several of whom the BSA knew posed dangers to kids, but allowed to remain in scouting.
Already, thousands of lawsuits against local councils nationwide, including dozens in Washington, have been put on hold pending the bankruptcy case.
The most recent IRS tax filings show five local councils in Washington reported collective assets of about $52 million in 2018, with the Chief Seattle Council reporting $39 million, and the Mt. Baker Council in Everett and the Pacific Harbors Council in Tacoma each reporting about $4.5 million.
“They have significant assets, but they appear to be offering a fraction of what they could pay, and should pay, to survivors,” Amala said. “How can someone agree to this proposed plan where they get about $6,000 when they might get 10, 20, or many times that amount if their council actually pays what they owe?”
Representatives for the local councils in Seattle, Everett and Tacoma, who previously have said their groups for years have taken steps to protect youth and train volunteers, either declined to comment or didn’t respond to messages Tuesday.
The national BSA, in its statement Tuesday, said it would supplement its plan in coming months with “a more detailed breakdown of the process to compensate survivors and more details about how local councils will support this effort.”
“We are hopeful we can come to a resolution that is in the best interest of survivors and all parties and can emerge from Chapter 11 by this fall,” it added.
But Kosnoff said he and many of his clients already have seen enough. Some already have expressed their hope the Chapter 11 bankruptcy will fail and be converted to a Chapter 7, with the BSA forced to liquidate all assets, he said.
“They’re not just saying no to this plan, it’s hell no — and burn it to the ground,” Kosnoff said.
This story contains material from The Washington Post.