Significant progress in the BSA’s Chapter 11 case marked by filing of Third Amended Plan of Reorganization

The Boy Scouts of America (BSA) is pleased to share that we have made substantial progress in our Chapter 11 case by filing our Third Amended Plan of Reorganization yesterday. This filing comes after intensive mediation with all stakeholders involved in our Chapter 11 case, including the Coalition of Abused Scouts for Justice, which represents a large majority of claimants, the Tort Claimants Committee (TCC), the Future Claimants’ Representative, as well as many of our insurers, the Ad Hoc Committee of Local Councils, and others.

This amended Plan marks a significant step toward a global resolution of past abuse claims. It incorporates a number of updates following constructive mediation, which we believe will garner significant support for confirmation. Importantly, the BSA is hopeful that this Plan, or one very similar to it, will have the support of a supermajority of survivors. This promising development moves us closer to fulfilling our commitment to equitably compensate survivors and ensure the future of Scouting. The details of the amended Plan are as follows:

  • The national organization of the BSA has agreed to help fund the Trust to compensate survivors with significant contributions of cash, property, and other assets. Depending on the timing of emergence, national BSA’s contribution is expected to be as much as $250 million. The BSA believes that this proposal should eliminate the need for ongoing litigation in the bankruptcy involving the national BSA’s assets, thus allocating the maximum amount of funds possible for survivors.
  • Local Councils will make a substantial contribution to the Trust of $500 million, comprising at least $300 million in cash with the remainder in property to resolve any claims against local councils and become protected parties under the global resolution Plan.
  • The BSA and the Local Councils will also contribute their substantial insurance rights to the Trust. The BSA expects that these insurance rights will yield significant additional funds to compensate survivors. While insurance policy terms vary considerably by timeframe and jurisdiction, ultimately there are more than 100 insurance carriers who are party to the BSA’s Chapter 11 case. It is too soon to assign values to these insurance policies, but many have no set cap on payout.

With this encouraging step forward, the BSA is wholeheartedly committed to continuing our work with survivors, insurers and other parties in the case, and we will continue to negotiate with these parties in good faith through the mediation process to reach a final plan. Our hope is to seek confirmation of the Plan this summer and emerge from bankruptcy this fall.