(AP Photo/Elaine Thompson, File)

Boy Scouts of America seek to halt bankruptcy case brought on by sexual abuse claims

The bankruptcy comes from thousands of sexual abuse claims by former Boy Scouts

Roadblocks are continuing to pop up in the Boy Scouts of America bankruptcy case as the organization tries to finalize a reorganization plan built around a global resolution of thousands of sexual abuse claims by former Boy Scouts.

Attorneys for the youth organization filed a motion on Monday asking a Delaware bankruptcy judge to extend a preliminary injunction that halted lawsuits against local BSA councils and sponsoring organizations during the bankruptcy.

BSA attorneys said the filing was necessary because the official tort claimants committee that represents sexual abuse victims refused to consent to an extension, despite doing so several times in the past.

The current injunction expires March 19. The BSA, which hopes to emerge from bankruptcy this summer, is seeking an extension through July 19.

Attorneys for the BSA argue that maintaining the injunction is critical to restructuring efforts, including enabling local councils and chartered organizations to participate in mediation and, ultimately, make “a substantial contribution” to a settlement and global resolution of abuse claims. Allowing lawsuits against local councils and sponsoring organizations to proceed will make it difficult, if not impossible, for the BSA to both equitably compensate abuse survivors and ensure that the organization can continue to carry out its charitable mission, they contend.

“The TCC is apparently willing to gamble with the fortunes of abuse survivors and the debtors when the stakes are the highest,” BSA attorneys wrote, referring to the tort claimants committee.

An attorney for the committee did not immediately respond to an email seeking comment Tuesday.

Monday’s court filing came just days after the bankruptcy judge heard arguments on a request by insurance companies for permission to serve document requests on 1,400 people who have filed sexual abuse claims and to question scores of them under oath in an effort to determine whether there is widespread fraud in the claims process.

More than 95,000 sexual abuse claims have been filed in the case. Before the bankruptcy filing, the BSA had been named in about 275 lawsuits and told insurers it was aware of another 1,400 claims. The number of lawsuits has more than tripled in the past year to about 860 lawsuits in more than 110 state and federal courts. Roughly 600 were filed after the organization first sought the preliminary injunction.

The Boy Scouts of America, based in Irving, Texas, sought bankruptcy protection last February in an effort to halt hundreds of individual lawsuits and create a compensation fund for men who were molested as youngsters decades ago by scoutmasters or other leaders.

The roughly 250 local councils, which run day-to-day operations for local troops, are not listed as debtors in the bankruptcy and are considered by the Boy Scouts to be legally separate entities, even though they share insurance policies and are considered “related parties” in the bankruptcy case.

Attorneys for abuse victims made it clear from the onset of the bankruptcy that they would go after campsites and other properties and assets owned by councils to contribute to a settlement fund.

But the tort claimants committee has been frustrated with the response by local councils to requests for document production and information on their financial assets. After seeking court permission last year to issue subpoenas for information it claimed was being withheld by the BSA and its local councils, the committee filed a complaint last month challenging BSA’s contention that two-thirds of its listed $1 billion in assets, more than $667 million, are “restricted assets” unavailable for creditors.

More than half of the purportedly restricted assets, $345.4 million, consists of a note receivable from Arrow WV, a non-profit entity that was formed by the BSA in 2009 and which owns the Summit Bechtel Reserve in West Virginia, home to the National Scout Jamboree. The BSA leases the Summit from Arrow WV and provides the services required for its operation.

The tort committee contends that there is no restriction that could be applied to the Arrow WV note.

The BSA’s purportedly restricted assets also include three “High Adventures Facilities” valued at more than $63 million. They are the Philmont Scout Ranch in New Mexico, the Northern Tier in Minnesota and the Florida Sea Base. The committee asserts that there are no specific deed restrictions or donor restrictions that preclude the sale of those facilities and use of the proceeds to pay creditors. It also claims that the BSA previously took the position that they were unrestricted.

Attorneys for the BSA noted in Monday’s court filing that the tort claimants committee has received some 327,000 pages of documents regarding local council assets, the nature of restrictions on those assets, and historical transactions.

READ MORE Tiger Woods seriously injured in California car crash

READ MORE: B.C. salmon farmers request more time to leave Discovery Islands

Like us on Facebook and follow us on Twitter.

Want to support local journalism? Make a donation here.

Boy Scouts sexual abuse

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Asymptomatic testing will now be available for "priority groups" who are most likely to spread the COVID-19 virus to vulnerable or at-risk populations. File photo by THE CANADIAN PRESS
A judge has found an Edmonton woman guilty of manslaughter in the death of her five-year-old daughter. THE CANADIAN PRESS/Jason Franson
Edmonton mother found guilty of manslaughter in death of 5-year-old girl

The woman was charged and pleaded not guilty to second-degree murder and assault with weapons, including a belt and a spatula

Alberta has 1,910 active cases of COVID-19 as of Wednesday. Red Deer is reporting five active cases, with 108 recovered. (File photo)
Alberta identifies 2,042 new COVID-19 cases Saturday

Central zone has 2,917 active cases

Alberta Premier Jason Kenney. THE CANADIAN PRESS/Jason Franson
Jason Kenney urges federal government to push U.S. for surplus COVID-19 vaccines

‘It makes no sense for our neighbours and regional states to be sitting on doses that we cannot use,’ the premier said

Alberta reported an additional 1,980 cases of COVID-19 Friday. (NIAID-RML via AP)
Red Deer adds 37th death from COVID-19, active cases drop

Alberta Health identified an additional 1,980 cases of the virus province-wide

FILE - In this March 3, 2021, file photo, a vial of the Johnson & Johnson COVID-19 vaccine is displayed at South Shore University Hospital in Bay Shore, N.Y. (AP Photo/Mark Lennihan, File)
Johnson & Johnson COVID vaccine can be given to adults 30+ who can’t wait for mRNA: NACI

Panel says single shot vaccine can be especially useful for populations unable to return for second shot

Dr. Karina Pillay, former mayor of Slave Lake, Alta., is shown at her medical clinic in Calgary on Friday, April 16, 2021. THE CANADIAN PRESS/Jeff McIntosh
10 years later: Former Slave Lake mayor remembers wildfire that burned through town

Alberta announced in 2011 that an unknown arsonist had recklessly or deliberately ignited the forest fire

The body of Brenda Ware, 35, was found along Highway 93 in Kootenay National Park on Thursday, May 6, 2021. (RCMP handout)
RCMP ask for tips after woman travelling from Alberta found dead in B.C. park

Brenda Ware was found along Highway 93 in the park, 54 kilometres north of the town of Radium

A caribou grazes on Baffin Island in a 2008 file photo. A last-ditch attempt to save some of Canada’s vanishing caribou herds is a step closer after a scientific review panel’s approval of a plan to permanently pen some animals and breed them to repopulate other herds. THE CANADIAN PRESS/AP-Kike Calvo via AP Images
Parks Canada captive caribou breeding proposal gets OK from scientific review panel

Wolf density in Jasper is low enough that the animals would not be expected to be a major threat

People pass the red hearts on the COVID-19 Memorial Wall mourning those who have died, opposite the Houses of Parliament on the Embankment in London, Wednesday, April 7, 2021. On May 3, the British government announced that only one person had died of COVID-19 in the previous 24 hours. THE CANADIAN PRESS/AP-Kirsty Wigglesworth
For a view of a COVID-19 future, Canadians should look across the pond

Britain, like Canada, is one of the only countries in the world to delay second doses for several months

Nuns of Mother Teresa’s Missionaries of Charity, carry some of her relics during a vigil of prayer in preparation for the canonization of Mother Teresa in the St. John in Latheran Basilica at the Vatican, Friday, Sept. 2, 2016. In which city did she do much of her charitable work? (AP Photo/Gregorio Borgia)
QUIZ: How much do you know about these motherhood issues?

In honour of Mother’s Day, take this 10-question quiz

Canada’s chief public health officer is reminding Canadians even those who are fully vaccinated are not immune from transmitting the COVID-19. THE CANADIAN PRESS/Adrian Wyld
Canada’s top doctor warns full vaccination does not equal full protection from COVID-19

Post-inoculation, Theresa Tam says the risk of asymptomatic infection and transmission is far lower but not obsolete

Jennifer Coffman, owner of Truffle Pigs in Field, B.C., poses beside her business sign on Thursday, May 6, 2021, in this handout photo. Her restaurant and lodge have been hit hard by a closure of a section of the Trans-Canada Highway and by the British Columbia government discouraging Alberta residents from visiting during the pandemic. THE CANADIAN PRESS/HO-Jennifer Coffman, *MANDATORY CREDIT*
‘Why we survive’: B.C. boundary towns struggle without Albertans during pandemic

Jennifer Coffman’s restaurant is located in the tiny community of Field, which relies on tourism

A rodeo south of Bowden drew a huge crowd on May 1 and 2, 2021. (Photo courtesy Mom’s Diner’s Facebook page)

Most Read