Boy Scouts insurers prepare to appeal bankruptcy settlement approval

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The statue of a scout stands in the entrance to Boy Scouts of America headquarters in Irving, Texas, February 5, 2013. REUTERS/Tim Sharp

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  • Hearing on Boy Scouts' revised bankruptcy plan September 1st

(Reuters) - A group of Boy Scouts of America insurers will likely appeal the youth group's $2.3 billion sexual abuse settlement after it is approved in bankruptcy court, their attorneys said Thursday.

The insurers, including AIG and Liberty Mutual, had objected to the settlement, saying the Boy Scouts colluded with men who claimed they were abused by troop leaders as children to push liability onto the insurers. The insurers' attorneys said at a Thursday hearing in Delaware bankruptcy court that they continued to object despite U.S. Bankruptcy Judge Laurie Selber Silverstein's partial approval of the deal and recent revisions made to it by the Boy Scouts.

The Boy Scouts will seek court approval next month for its revised bankruptcy plan, which would provide at least $2.3 billion to compensate more than 80,000 men who have made abuse claims. The biggest change in the amended plan was the removal of a $250 million settlement payment from the Church of Jesus Christ of Latter-day Saints, which Silverstein refused to approve.

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Silverstein approved many parts of the plan in a July 29 opinion, and the Boy Scouts' latest revisions were meant to address the parts that Silverstein did not sign off on.

Silverstein is likely to approve the modified plan at a September 1 hearing.

Silverstein's July 29 opinion scaled back some of the Boy Scouts' proposals related to insurance coverage for sexual abuse. The insurers' attorneys did not discuss in court which portions of the opinion they intend to appeal.

Two of the Boy Scouts’ primary insurers, affiliates of Hartford Financial Services Group and Chubb Ltd, support the settlement and are not part of the group that is considering an appeal.

The Boy Scouts filed for bankruptcy in February 2020 after being hit by a flood of sexual abuse lawsuits when several U.S. states passed laws allowing accusers to sue over allegations dating back decades.

The amount of money that individual abuse survivors stand to gain from the bankruptcy plan ranges from $3,500 to $2.7 million.

The case is In re Boy Scouts of America, U.S. Bankruptcy Court for the District of Delaware, No. 20-10343.

For the Boy Scouts: Jessica Lauria, Mike Andolina, Matt Linder and Laura Baccash of White & Case; and Derek Abbott and Andrew Remming of Morris, Nichols, Arsht & Tunnell

For the objecting insurers: James Hallowell of Gibson Dunn & Crutcher and David Christian of David Christian Attorneys.

Read more:

U.S. judge rejects parts of Boy Scouts' $2.7 billion sex abuse deal

Boy Scouts secure more survivor support ahead of final battle over sex abuse deal

Boy Scouts wrap up month-long trial over $2.7 bln sex abuse deal

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