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The Boy Scouts of America was dogged by sex-abuse claims for more than 50 years before it implemented key child-safety policies in the late 1980s. Now, after more than a dozen states changed their statute-of-limitations laws in 2019 to allow lawsuits based on decades-old allegations, hundreds of men are coming forward to say they were abused decades ago, the Wall Street Journal reported. The approximately 275 resulting suits caused the Boy Scouts to file for bankruptcy protection last week, halting all current cases. The youth group said that it plans to set up a fund through the bankruptcy process to compensate victims. In contrast to the plight of the Catholic Church, which has wrestled with well-publicized claims of sex abuse for decades, the Boy Scouts avoided widespread attention until rather recently. Largely shielding the organization were the nation’s patchwork of statute-of-limitations laws, ineligible volunteer files that were kept confidential and a general unwillingness among young boys to bring forward their accounts of abuse. Public awareness grew with a 2010 case in Oregon in which a jury awarded a man who was sexually abused in the early 1980s with nearly $20 million. The Oregon Supreme Court also ordered the youth organization to release nearly 1,250 confidential files of alleged abusers, bringing more attention to abuse claims in the Boy Scouts.

The defunct Hahnemann University Hospital has agreed to provide insurance for hundreds of new doctors displaced by the historic Philadelphia institution’s bankruptcy, WSJ Pro Bankruptcy reported. The hospital and its insurance company — also controlled by Joel Freedman, the investment banker who led the group that acquired Hahnemann in early 2018 — will cover a gap that had threatened the professional futures of residents and fellows who were in training at the hospital when it closed down last year. Hahnemann will pay about two-thirds of the $9 million cost of the insurance, and Freedman’s affiliated insurance company will pay for the rest, according to a Thursday court filing. The agreement ends months of uncertainty for hundreds of new doctors, who were trying to find a way to cover insurance premiums as high as $95,000 to protect against lawsuits that might not be filed for years, stemming from their work at Hahnemann. More than 900 doctors were in danger of having their professional credentials tarnished if they couldn’t find replacement insurance. The offer from Hahnemann and its owners to provide insurance came after months of talks spurred by a threat from Judge Kevin Gross to oust the hospital company’s management from control, and put a trustee in charge of Hahnemann’s bankruptcy.

A proposed USA Gymnastics tiered settlement system would pay some sexual assault victims of former U.S. team doctor Larry Nassar only $82,550, according to multiple reports on Saturday detailing the payment plans. Simone Biles, expected to be among the stars of this year's Tokyo Olympics after winning four gold medals at Rio in 2016 and 19 world titles including a fifth all-around crown last year, would be among 66 gymnasts to receive the top-level settlement amount of $1.25 million. An attorney for hundreds of victims of Nassar's abuse says the total $215 million settlement offer is insufficient and releases too many people from further claims, including the US Olympic and Paralympic Committee, former USA Gymnastics chief executive Steve Penny and former national team directors Bela and Martha Karolyi. A disclosure statement filed with the U.S. Bankruptcy Court for the Southern District of Indiana was outlined in reports by the Orange County Register and ESPN, detailing what 517 people Nassar assaulted would be paid under terms of the settlement.

Tom Vilsack, a former Iowa governor and U.S agriculture secretary, will monitor Purdue Pharma to ensure the OxyContin maker does not revive an aggressive marketing effort that critics say overstated the benefits of its opioid painkillers and downplayed the danger of addiction, the Associated Press reported. Purdue Pharma announced the appointment on Friday as part of its federal bankruptcy proceedings. Vilsack worked on rural opioid issues as agriculture secretary under former President Barack Obama. Purdue is facing more than 2,000 lawsuits over its role in the nation's opioid crisis, which has been linked to more than 430,000 deaths in the U.S. since 2000. The Stamford, Connecticut-based company entered bankruptcy court in White Plains, N.Y., last year as part of an effort to settle those claims. It's trying to get buy-in for a proposed settlement that could be worth more than $10 billion over time. The lawsuits against Purdue and the members of the Sackler family that own the company are on hold while the parties try to reach a settlement. Purdue has already agreed to cease the marketing practices at the heart of the lawsuits. Critics say its marketing and sales practices, including to doctors, helped fuel the crisis beginning in the late 1990s.

The Roman Catholic Diocese of Harrisburg, Pa., filed for bankruptcy yesterday, becoming the first diocese in the state to seek protection from financial claims in the aftermath of a 2018 grand jury report that revealed decades of sexual abuse and cover-up by the church’s top leaders, the Philadelphia Inquirer reported. And, said a lawyer for the diocese, it’s not likely to be the last. Citing the fallout from that probe and recent court decisions that opened new avenues for some victims with time-barred claims to sue, attorney Matt Haverstick said that Harrisburg, like each of the state’s eight other Catholic dioceses, faces the prospect of crushing court judgments that it will be unable to pay. “There is no capacity to take that kind of exposure,” Haverstick said. “I think this is really the beginning — not just in Pennsylvania but across the country — of a wave of reorganizations spawned by … the economics of trying to maintain an organization in the face of catastrophic litigation.” With its filing yesterday, the Harrisburg Diocese joins more than two dozen others across the United States that have sought similar bankruptcy protections since the clergy sex-abuse scandal first exploded in Boston 18 years ago. The move comes six months after Bishop Ronald W. Gainer announced that the Harrisburg church had paid out $12.5 million in settlements with more than 100 accusers through an independently run victim compensation fund.

As the Boy Scouts of America hurries to emerge from bankruptcy and put allegations of sexual abuse to rest, lawyers for victims want the organization’s “dark side” revealed in its bankruptcy proceedings, the Wall Street Journal reported. With billions of dollars worth of land, buildings, cash and investments to protect, the Boy Scouts appeared for the first time yesterday before the U.S. Bankruptcy Court in Wilmington, where a lawyer for the organization, Jessica Boelter, said that it recognized the harm endured by victims of childhood sexual abuse. The bankruptcy filing is designed to resolve allegations of sexual abuse in 275 existing lawsuits and from thousands of more people who haven’t filed papers in court. “We need to move through this bankruptcy as quickly as possible,” Boelter said in court. Lawyers for abuse victims said they are looking to the bankruptcy process as a way to find out more about circumstances surrounding allegations of widespread abuse of boys as young as 5 years old by scoutmasters and others connected to the organization. “We’re not here because the Boy Scouts do a great job at taking care of boys or training boys,” said James Stang, a lawyer for sexual-abuse survivors. “There’s a very dark side to their history.” He said the 10 law firms he advises are representing “probably more than 2,700 men” combined, some of which are elderly, sick or have pressing psychological counseling needs.”

The Boy Scouts of America filed for chapter 11 amid sexual abuse lawsuits it is facing. On one level, the victims get some compensation while the organization gets legal clarity and finality. Yet on closer examination, it is troubling about using laws designed to resolve business meltdowns to address the social ills caused by nonprofit entities that are meant to do good, but have done harm, according to a Bloomberg commentary. The lawsuits against the Scouts, like the sexual abuse lawsuits against the Catholic Church and Gymnastics USA, are about our collective assignment of moral blame, and about what can be done for victims who can never be made whole by mere monetary compensation. Unlike chapter 7 bankruptcy, which essentially puts an end to a bankrupt corporation and liquidates its assets, chapter 11 is meant to save a corporation. As applied to for-profit corporations that have caused what are sometimes called mass torts — injuring many people through a common cause or pattern of behavior — chapter 11 still makes a kind of economic sense. The U.S. tort system assigns a monetary value to the injuries that people have suffered. Those who’ve been injured then effectively become creditors of the company. Because the company doesn’t have enough money to pay both the victims and its other creditors, we allow it to reorganize. As a mechanism necessary to make the system work, we impose on tort victims some of the same limits that bankruptcy imposes on other kinds of creditors. They have to file their claims by a certain date and agree to a system for determining what they will get. When it comes to nonprofits organized to provide public goods, like scouting or religion or gymnastics, this model makes much less sense, according to the commentary. These aren’t organizations whose future operations will make profits that would go to compensate victims. Read the full commentary. 

*The views expressed in this commentary are from the author/publication cited, are meant for informative purposes only, and are not an official position of ABI.