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Boy Scouts who were sexually abused – potentially thousands of them – face a Nov. 16 deadline for filing claims that could give them both financial compensation and a vote in how a massive bankruptcy case plays out. 

Boy Scouts of America (BSA) filed for bankruptcy protection under Chapter 11 on Feb. 18, 2020 in U.S Bankruptcy Court for the District of Delaware, citing a large increase in sexual abuse lawsuits. According to the BSA, the move was designed to protect the organization from civil liability, while also providing a system for equitably compensating victims.  Court papers indicate as many as 12,000 youth may have been abused in the past century.

Increased attention to child sexual abuse and the loosening of statutes of limitations in many states led to the flood of claims. A background brief filed by BSA notes that they know of 1,700 claims of abuse. The suits accuse BSA of not protecting the children from abuse and in some cases of covering up molestation.

Jim Turley, chairman of Boy Scouts of America said the bankruptcy case will set up a Victim’s Compensation Trust to settle claims.

 “I want you to know that we believe you, we believe in compensating you, and we have programs in place to pay for counseling for you and your family by a provider of your choice,” Turley said.

Will Ourand, an attorney with Newsome Melton who is handling Boy Scout victim claims, said it’s too early to know exactly how much money will be in the compensation fund or how it will be apportioned. 

Having all the claims funneled through bankruptcy court could mean less chance of a large payout from a jury trial in an individual case. But Ourand said there are tradeoffs. Victims’ names will not be released publicly unless they choose that option. “This is highly sensitive. Ideally it should enable victims to submit claims without worrying their neighbor or their employer will know about it.”

The handling of claims through a Victims Compensation Trust is also supposed to help ensure compensation is awarded in a consistent manner. 

Victims who don’t file by Nov. 16 won’t be able to sue BSA. Financial compensation can’t make up for the abuse but can ameliorate negative impacts on victims’ careers and families and give them more options for mental health treatment, Ourand said.

Filing a claim also entitles victims to a vote on the overall bankruptcy plan. One of the top issues that will be settled by the plan is whether local councils of BSA will have protection from lawsuits or can be sued separately. BSA has 261 local councils that have millions in assets of their own. The national organization has argued that councils are separate entities akin to franchisees whose assets should be protected by the bankruptcy proceedings. Ourand said victims should file a claim if they want to have a vote in whether the local councils are immune from suits as part of the bankruptcy. 

Newsome Melton has learned how to best help victims in large bankruptcy cases after leading efforts for Takata airbag victims. 

“It’s much different than litigating a case,” Ourand said. “We’ve learned how to present the facts and evidence in a matter that a claims administrator will understand and value.”

If you have questions about this topic or need assistance filing a claim, Newsome Melton can help. Contact us at 1-888-380-2809.