A bankruptcy judge asked the Boy Scouts of America to justify why more than 100,000 groups that have supported its mission but themselves aren’t in chapter 11 are getting legal protections through the youth organization’s restructuring, WSJ Pro Bankruptcy reported. Judge Laurie Selber Silverstein on Tuesday also asked the youth group why it needed such an “elaborate, interconnected” bankruptcy plan when at one point the nonprofit’s reorganization blueprint addressed only its own financial troubles. The Irving, Texas-based group, which filed for bankruptcy in 2020, is in the fifth week of a trial seeking court approval of a $2.7 billion compensation fund that would settle about 82,200 sexual-abuse claims. Nearly 86% of the votes cast favor the group’s plan. One “thing that’s extraordinary about this case is the sheer magnitude of the number of releases being sought here,” said Judge Silverstein, of the U.S. Bankruptcy Court in Wilmington, Del. She said she heard the number grew to include 100,000 partner organizations. “And then I heard 140,000,” she said. Judge Silverstein asked lawyers for the youth group to discuss those numbers and why they are justified. Boy Scouts lawyer Jessica Lauria said the group’s sponsors, known as chartered organizations, are typically nonprofits like individual churches and parishes.
