Victims of longtime national team physician Larry Nassar moved to dismiss USA Gymnastics’ bankruptcy proceedings on Tuesday, a sign that the gymnasts and federation remain far apart in mediation talks to resolve legal claims stemming from sexual abuse by Nassar over a three-decade period, the Wall Street Journal reported. USA Gymnastics and the U.S. Olympic and Paralympic Committee have been sued by hundreds of women and girls who were treated by Nassar at his practice at Michigan State University, as well as dozens of gymnasts who competed for the U.S. Attorneys representing victims had been in mediation for more than two years in a bid to settle the suits, a tangled process that also encompassed attempts to resolve litigation between USA Gymnastics and its insurers, former national team coordinator Martha Karolyi, individual coaches, and the U.S. Olympic and Paralympic Committee, which oversees national governing bodies and athletes on the Olympic team. USA Gymnastics filed for bankruptcy in December 2018, which halted depositions and discovery in the lawsuits and disrupted formal efforts to revoke USA Gymnastics’ status as the sport’s official governing body by the USOPC. The measure had also opened the door for more people to file claims, and potentially be paid out in a more orderly manner under bankruptcy rules that allow troubled organizations to pool money from their assets. If the victims’ lawyers are successful in persuading the federal judge overseeing the proceedings in Indianapolis to drop the bankruptcy, the organization will once again confront the lawsuits filed in courts across the country and could also be exposed to new ones. Losing even one case could lead the organization to face an expensive judgment and the turnover of valuable property to pay for it, putting it in an even more dire financial state.
