A federal judge backed the Boy Scouts of America’s chapter 11 plan to settle sex-abuse lawsuits that sent the youth group to bankruptcy, bringing it closer to ending more than three years of court protection, WSJ Pro Bankruptcy reported. U.S. District Judge Richard G. Andrews of the U.S. District Court in Wilmington, Del., upheld the youth group’s settlement plan for more than 82,000 claims of childhood sexual abuse, rejecting appeals from some victims and insurance companies following its approval by a bankruptcy court last year. Yesterday’s ruling puts the Boy Scouts on the cusp of ending the largest-ever bankruptcy case resulting from allegations of childhood sexual abuse and bolsters the use of chapter 11 to resolve mass litigation. The chapter 11 plan is expected to resolve the Irving, Texas-based group’s liability for decades of childhood sexual abuse and settle claims against affiliated local councils and the civic and religious groups that sponsored scouting activities. Local councils, sponsoring groups, insurance companies and the Boy Scouts put together a $2.5 billion fund for victim compensation. The bankruptcy plan makes it possible for abuse claims to be administered and paid in “an equitable process,” according to the judge’s ruling. Judge Andrews said that nearly every creditor constituency supported the chapter 11 plan, a “commendable result for such a lengthy, contentious and emotionally charged proceeding.” The Boy Scouts would leave chapter 11 low on cash but retaining much of the property held by its local councils that makes up the majority of the organization’s wealth.
