Boy Scouts Bankruptcy FAQs
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The Boy Scouts Filed for Bankruptcy
On February 18, 2020, the Boy Scouts of America filed for bankruptcy. You can read the bankruptcy petition of the Boy Scouts of America by clicking here and the bankruptcy petition of the related Delaware BSA, LLC, by clicking here.
We represent dozens of people who were sexually abused by Boy Scout leaders, Cub Scout leaders, and others associated with the Boy Scouts of America, and we filed many of the lawsuits that led to the Boy Scouts filing for bankruptcy. That means our clients are some of the first “creditors” in the Boy Scouts’ bankruptcy.
What Does a Bankruptcy Mean for Abuse Survivors?
This page is intended to provide abuse survivors with answers to commonly asked questions. Some of our lawyers have represented abuse survivors in a number of the Catholic bankruptcies, including the bankruptcies of the Christian Brothers, the Jesuits in the Northwest, the Diocese of Spokane, the Archdiocese of Milwaukee, and others, so the information on this page is based on our experience in those past bankruptcies. Please know what has happened in the past is no guarantee of what will happen with the Boy Scouts’ bankruptcy, but it will give you some sense of the common issues raised by these bankruptcies that involve abuse survivors.
Most importantly, a bankruptcy does not mean the Boy Scouts have no assets or that abuse survivors will automatically get nothing. To the contrary, the goal of a bankruptcy is to allow a bankruptcy judge to marshal the Boy Scouts’ cash, other assets, and insurance, and then ensure that abuse survivors are compensated in a way that is fair to everyone.
However, in order to be compensated, abuse survivors must file a claim in the bankruptcy by a court-ordered deadline or they will forever forfeit their right to pursue a claim or compensation from the Boy Scouts. This deadline may well be shorter than the length of time allowed for by state law, including the two year “window” for New Jersey that went into effect on December 1, 2019. For that reason it is critically important that abuse survivors contact a lawyer to learn their legal options and timely file a claim.
Frequently Asked Questions
Why Did the Boy Scouts File for Bankruptcy?
The Boy Scouts of America filed for bankruptcy in order to seek relief from the dozens of child sexual abuse lawsuits filed against it after statute of limitations reform in a number of states, including New Jersey, New York, and California. We filed many of the first lawsuits against the Boy Scouts in those states.
By filing for bankruptcy, all lawsuits against the Boy Scouts are “stayed” (put on pause) and a bankruptcy judge is assigned to oversee all of the claims against them. Generally speaking, the bankruptcy judge is responsible for determining the Boy Scouts’ assets that are available to compensate abuse survivors, including cash, property, and insurance, and then deciding a fair way to use those assets to compensate abuse survivors.
Doesn’t the Bankruptcy Mean the Boy Scouts Have No Assets?
The bankruptcy absolutely does not mean that the Boy Scouts have no assets or that abuse survivors will automatically receive no compensation. Instead, the purpose of a bankruptcy is to ensure that the Boy Scouts’ assets are fairly divided among its creditors, including survivors of sexual abuse who file claims in the bankruptcy. The first step in the bankruptcy is to determine what assets the Boy Scouts have to compensate abuse survivors, including cash, property, and insurance .
Why Should I File a Claim?
People with any type of claim against the Boy Scouts need to know about the “bar date” deadline that will likely require all people with claims against the Boy Scouts, including sexual abuse survivors, to file a claim with the bankruptcy court. This deadline is called a “bar date” because people who come forward after the deadline are usually “barred” from ever filing a claim against the entities that declared bankruptcy. The “bar date” deadline may also extend to other entities who participate in the bankruptcy, such as the local councils and sponsoring organizations.
The bankruptcy judge has not yet set a “bar date” for the Boy Scouts’ bankruptcy, but these deadlines can be as short as 3-4 months from when an entity files for bankruptcy. As you may know, New Jersey recently passed a new law that gives all abuse survivors, regardless of their current age, two years from December 1, 2019, to file a civil lawsuit for the abuse they suffered. However, the “bar date” would likely be much, much shorter than that two year period. If you were abused and have a claim against the Boy Scouts, this means your deadline for filing a claim may be significantly shorter than the two years allowed under the new New Jersey law — the deadline could be as short as a few months.
If you have a claim against the Boy Scouts, or anyone associated with the Boy Scouts, the time to act is now. Please contact us to learn how to protect your rights.
Does This Mean the Boy Scouts Will Automatically Shut Down?
No. There have been 20 Catholic bankruptcies across the United States, and one of the lead Catholic attorneys is now on record as admitting that the Catholic church has not had to shut down parishes or schools, or reduce their services, as a result of these bankruptcies. For example, most Catholic Dioceses own a significant amount of property, and rather than sell their property, they take out a loan against their property to help compensate abuse survivors. Moreover, insurance companies have contributed a significant amount toward the prior bankruptcies, such as an insurance company that paid more than $100 million toward the bankruptcy of the Jesuits. It is too early to tell how this bankruptcy will affect the Boy Scouts, but keep in mind that their membership numbers have been dwindling for many years.
Are Other Entities Involved, Like the Local Councils and Sponsoring Organizations?
If you have a claim against the Boy Scouts, you may also have a claim against other entities, such as the local council and the organization who sponsored your Troop. This is another reason why it is important that abuse survivors act now and take steps to learn their options.
What Do I Need to Do to File a Claim in the Bankruptcy?
Please contact us and we can explain the process for filing a claim in the bankruptcy. In every bankruptcy you begin the process by filing a short “claim form” that advises the bankruptcy court of your claim. To date, the bankruptcy court in every Catholic bankruptcy has protected the identity of abuse survivors from being publicly known. The bankruptcy court will decide how abuse survivors should be compensated, but most Catholic bankruptcies have involved each abuse survivor submitting a 4-5 page statement, with a neutral third party then reviewing the statement of each person to decide how much they should receive out of the available assets.