In light of the increasing number of sexual abuse allegations coming from brave survivors who choose to speak out, the Boy Scouts of America has filed for bankruptcy chapter 11. What does the Boy Scouts bankruptcy mean exactly? Why have they done it? What does it mean for you? Continue reading.
Background: Boy Scouts Bankruptcy
The group that has filed for bankruptcy is the national group that governs all 272 local Boy Scout councils. It is important to note that the independent councils are fiscally and legally independent.
The goal of this filing is to protect the organization and those local councils from the approximately 275 current lawsuits and to try to control the flood of legal actions that have been filed. This filing has effectively, though only temporarily, halted the legal cases while they create a reorganization plan. This temporary stay will eventually be lifted and the legal process will continue. We will continue to update you, but what we do know is that this “stay” will end and they will have to respond to the legal cases.
What is a Chapter 11 Bankruptcy?
A chapter 11 bankruptcy is also known as a Business Reorganization. The goal is to create a plan for the affected organization to restructure their debts and assets to allow them to survive. In this case, the Boy Scouts are attempting to control the lawsuits by creating a victims fund for all the existing and pending cases which may number up to 1,400 according to USA Today. Current and pending litigants would become “creditors” and therefore be included in that restructuring plan.
What Does This Mean To Survivors?
Some advocacy groups argue that this could be good for survivors. Although they will need to come forward soon, as there is a deadline, they can be compensated without having to undergo the rigors of a typical trial. However, if they don’t come forward in time, they will be barred from seeking legal redress against the national organization.
The legally distinct status of individual local councils may still provide an opportunity for legal action against perpetrators, but the sticking point for most interested parties is that the national organization is seeking to protect its local councils’ assets under this reorganization. In other words, they are trying to indemnify the local councils to protect them from future actions. How this will play out is still unknown
What Does The Future Hold?
According to the Boy Scouts of America, they intend to fairly compensate all victims and to continue their role as a national organization. With a chapter 11 filing, they have the chance to survive and reorganize, although not all organizations survive this process.
One final note of significant importance is the recent changes to statute of limitation laws in many States. They are allowing victims to bring their cases when new information has come to light. Some states are creating “windows” to pursue justice. It is for this reason that we urge you to reach out to responsible, knowledgeable legal council to learn what actions might be in the best interest of yourself or your family.
We here at Massey Law Firm are highly experienced and knowledgeable on the subject of abuse claims and are here to help. If you are worried that the Boy Scouts of America bankruptcy filing will keep you from justice, it won’t. We’ll make sure of that.
Please call to get a free case review as soon as possible. You can reach us at 602-955-0055.