Lawyers representing a group of sex-abuse victims with claims against the Boy Scouts of America are asking the U.S. Supreme Court to pause payments to survivors from a $2.4 billion settlement fund created as part of the youth organization’s bankruptcy plan, WSJ Pro Bankruptcy reported. The lawyers, who represent a fraction of over 82,000 Boy Scouts sex-abuse plaintiffs, argued that since a central feature of the youth organization’s settlement is being litigated in the U.S. Supreme Court in the challenge to Purdue Pharma’s similar bankruptcy plan, the Boy Scouts plan should be suspended until the high court reaches a decision in the opioid maker’s case, according to court papers filed on Wednesday. Federal courts last October rejected earlier efforts by the same lawyers to suspend the Boy Scouts bankruptcy plan. U.S. District Judge Richard Andrews in Wilmington, Del., said then that unlike Purdue’s bankruptcy plan, the youth group’s reorganization had already gone into effect and many of the transactions it contemplated had already happened. The Supreme Court is set to examine on an expedited basis the issue of legal immunity granted in the Purdue reorganization plans that is also a key feature in the Boy Scouts settlement: whether bankruptcy courts can extinguish legal claims against third parties that aren’t in chapter 11 without the consent of all claimants.
