Insurer agrees to $800 million settlement in Boy Scouts bankruptcy
DOVER, Del. (AP) â Lawyers in the Boy Scouts of America bankruptcy case have reached a tentative settlement under which one of the organization’s largest insurers would contribute $800 million to a fund for victims of child sexual abuse.
The agreement announced Monday calls for Century Indemnity Co. and its affiliates to contribute $800 million to the fund in exchange for being released from further liability for abuse claims. The payment would bring the amount of money in the proposed trust to more than $2.6 billion, which would be the largest sexual abuse settlement in US history.
The settlement comes as more than 82,000 sex abuse claimants face a Dec. 28 deadline to vote on a previously announced Boy Scouts reorganization plan.
This plan called for the Boy Scouts and its approximately 250 local councils to contribute up to $820 million in cash and property to a fund for victims. They would also assign certain insurance rights to the fund. In return, local councils and the national organization would be relieved of any further liability for claims of sexual abuse.
The plan also includes settlement agreements involving another of the Boy Scouts’ main insurers, The Hartford, and the BSA’s former largest troop sponsor, The Church of Jesus Christ of Latter-day Saints, commonly referred to as the Mormon Church. The Hartford agreed to pay $787 million to the abuse plaintiffs fund, and the Mormons agreed to pay $250 million. In exchange, both entities would be released from any further liability regarding child sexual abuse claims.
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The Century settlement, which is subject to court approval, provides for additional contributions from the BSA and its local councils on behalf of approved sponsor organizations. They include a $40 million commitment from local councils and potential additional payments attributable to growth in BSA membership due to continued sponsorship of Scouting units by chartered organizations.
“This is an extremely important step forward in BSA’s efforts to fairly compensate survivors, and we hope it will lead to further settlement agreements with other parties,” the Boy Scouts said. in a prepared statement. “In addition to our ongoing negotiations with other insurers, the BSA has worked diligently to create a structure that will allow Roman Catholic-affiliated churches and United Methodist-affiliated churches that have sponsored Scouting units to contribute to the trust. proposed settlement to compensate survivors.â
Lawyers for an ad hoc group called the Coalition of Abused Scouts for Justice, which represents about 18,000 abuse plaintiffs, said in a press release that the Century settlement is another reason plaintiffs are voting for the plan. reorganization of the BSA.
“Not only is the coalition creating the largest compensation fund possible for survivors, it’s the only fund on the table, and it disappears with a ‘no,'” said the lawyer and co-founder of the coalition, Anne Andrews. “The coalition also continues to work with the Boy Scouts of America on accountability and safety measures to ensure that no child will have to endure the horrific damage and abuse our customers have experienced.”
Opponents of the plan include several other law firms, as well as the official committee appointed by the US Missouri bankruptcy trustee to represent the best interests of all sexual abuse claimants.
The committee said the plan is “grossly unfair” and represents only a fraction of the parties’ potential liabilities to the deal and what they must and can pay.