Boy Scouts of America plan to exit bankruptcy would pay abuse survivors an average of $6,000 each; survivors object

More than 95,000 former Boy Scouts have filed claims, saying they were sexually assaulted.

Boy Scouts of America is proposing to pay $220 million toward a trust to compensate tens of thousands of former members who say they were abused during their time as scouts, according to a statement from the committee that represents survivors in the case.

Another $300 million may come from a voluntary contribution from local councils, the Boy Scouts said in court documents filed Monday, but the local organizations have given no formal commitment.

The proposal is part of a reorganization plan put forth by the nonprofit detailing how it intends to handle the massive child sex abuse case that’s threatening its existence – the largest ever involving a single national organization – and emerge as a viable entity. .

At the time, the organization said it faced 275 lawsuits in state and federal courts plus another 1,400 potential claims.

“As a fiduciary to all sexual abuse survivors, the TCC has thoroughly investigated the assets and liabilities of the BSA and its local councils,” the committee said in a statement, “and concluded that the BSA's reorganization plan woefully fails to adequately compensate sexual abuse survivors or provide any enhanced systematic protections for future generations of Scouts.”.

Gill Gayle, an abuse claimant who serves on the committee, said it was only after juries began awarding survivors million-dollar verdicts that Scouts realized “the sum total of paying for their deeds exceeds their monetary value.” .

As a result of the violent sexual abuse he alleges he suffered as a kid in Scouts, Gayle said he spent $125 to $150 an hour on therapy for 26 years, which was rarely covered by insurance.

What is owned by local councils, and in turn how much of that should go to victims, remains a central point of contention.

More: Boy Scouts abuse claims may become largest case against a single national organization.

Tim Kosnoff, a lead attorney with the group Abused in Scouting, said the gulf is vast between what assets Boy Scouts have proposed to contribute and what survivors will approve – maybe too vast for the nonprofit to close before it runs out of moneyW

As it stands, the plan only contains a commitment from the national organization to request that local councils voluntarily contribute no less than $300 million to a trust for survivors.

Pfau of Pfau Cochran Vertetis Amala PLLC, who represents 1,000 survivors in the bankruptcy, said it's obvious that Boy Scouts is trying “conceal the fact that these councils are not paying a fair amount, and worse, they are trying to force abuse survivors to give up their claims for close to nothing.”  .

As first reported by the Wall Street Journal, roughly 70% of the Scouts’ wealth is held by different legal entities, namely local councils, most of which the national organization has attempted to wall off from the bankruptcy. .

Boy Scouts of America filed for bankruptcy after a flood of sex abuse cases, reports of declining membership, & legal battles with insurance companies.

Foohey also said the only entities obligated to contribute to the victims’ fund are the national organization that filed for bankruptcy and its insurers. 

Boy Scouts has insisted that the local councils are distinct and financially independent from the national organization and have argued they should be “protected parties” in the bankruptcy case.  

The national organization describes its relationship with local councils as essentially a franchise arrangement: The national group handles the development of Scout content and structure, licensing, training, human resources, legal support and information technology; the local councils oversee troops and Cub Scout packs in a region and run day-to-day operations.  

The Boy Scouts organization seeks to keep that injunction, and upon agreement of its proposed plan, to indemnify the councils “to the fullest extent lawful, from and against any and all claims, liabilities, losses, actions, suits, proceedings, third-party subpoenas, damages, costs and expenses (including full reimbursement of all fees and expenses of counsel), as incurred, related to, arising out of, or in connection with any Abuse Claim,“ according to Monday’s court filings. 

The Boy Scouts of America disclosed in a bankruptcy document that the group owns original Rockwell paintings, which would be sold off to pay sexual abuse victims. (Photo: Rick Bowmer, AP)

The filings continued that after the proposed plan would take effect, any abuse claims against the councils “permanently and forever stayed.“

Victims’ attorneys are fighting against Boy Scout’s assertion that the councils are discreet entities, noting that they operate hand-in-glove with the national organization and the councils have significant liability for their part in allowing child abuse to continue unabated for decades

They’ve also accused Boy Scouts of using the division to shield assets from survivors since a majority of the organization’s wealth lies at the local rather than national level. 

More: Tensions rise over local councils' role in Boy Scouts bankruptcy proceedings

“You’re asking victims to release not just BSA national but all these councils and you have no idea what the value is of the assets?” Kosnoff asked

Foohey said local councils may face significant liability if they don’t contribute to the fund, even though by law they may not have to

Boy Scouts is hoping to address those claims via the victims’ fund within the bankruptcy case

In recent weeks, insurers affiliated with insurers including Chubb and Hartford Financial Services Group, have questioned the validity of claims filed by law firms representing survivors arguing that they were poorly vetted and lack sufficient information.  

Its studios rebranded as Bode Yoga, which Foohey said is another option for Boy Scouts, with the local councils rolling over into a rebranded entity. 

Michael Lipari, abused at 14 by a Scout leader whom he helped convict of child abuse, said he wants to see the organization acknowledge its mistakes and do everything in its power to make the organization safe

An attorney representing hundreds of men molested by scoutmasters or other leaders decades ago said on Tuesday that victims will be 'deprived' of justice with the bankruptcy filing by the Boy Scouts of America

Pierce said that when he first filed a claim, he wanted to find a way for Boy Scouts to continue to exist while helping those it harmed.