The Boy Scouts of America filed for bankruptcy protection Tuesday amidst several expensive sex-abuse lawsuits.
In an official statement, Boy Scouts of America said that it will use the Chapter 11 filing to “equitably compensate victims” of abuse while keeping the organization from folding. The Boy Scouts would use the money from the bankruptcy protection filing to create a “Victims Compensation Trust,” according to the statement.
The decision had been expected since late 2018, when the Wall Street Journal reported that the Boy Scouts had hired a law firm to assist with a possible bankruptcy filing.
Ongoing lawsuits will be halted in response to the decision, says Michael Pfau, an attorney whose firm represents 300 former Scouts suing the organization for sexual abuse charges. Though the organization addresses victims in its bankruptcy filing, he says many of his clients feel it’s not enough.
“It's pretty typical for the abuse survivors we represent at first to be angry, because it's viewed as a legal ploy or a legal tool used by the Boy Scouts to avoid really, fully being exposed,” Pfau says.
The BSA has committed to compensating victims, but Pfau says many still feel robbed of the opportunity to tell their story after decades of remaining silent.
To put the scandal and subsequent bankruptcy filing in perspective, Pfau draws a parallel to Catholic dioceses throughout the U.S. that have declared bankruptcy in the wake of sexual assault lawsuits to protect assets and save face.
“The Boy Scout bankruptcy is historic in size and scope. We know that there were thousands of perpetrators in the Boy Scouts in all 50 states,” Pfau says. “The bankruptcy courts or the courts in the United States have never seen anything of this size or magnitude before. And that's why it will eclipse any of the Catholic bankruptcies that we've seen.”
On how the filling affects sexual abuse victims
“It's going to have an enormous impact on the cases. We presently represent 300 former Scouts across the country with high concentrations in California and New York, and those cases are filed or were to be filed in state court. The cases against the Boy Scouts will be stayed or halted and then ultimately transferred to bankruptcy court in Delaware.
“For most of the abuse survivors we represent, in Boy Scout cases and other cases, holding the institution accountable — and after years, sometimes decades of silence — being able to tell their story is really of the utmost importance. Now, that said, when a bankruptcy like this occurs, certainly our client's legal rights are not extinguished. They'll be compensated through the bankruptcy process. And also, we try real hard to give them a voice in the proceeding.”
On the path forward for Boy Scouts of America and survivors
“If they emerge from this in some sort of viable form, and they probably will, it is at least our sincere hope that when they emerge, they will be a transparent organization. They will warn parents and children about the dangers of abuse in scouting and will be a better organization. From someone who has advocated for Scout victims for decades, that has not been the case historically. This is really a day of reckoning for the Boy Scouts.
“If there are abuse survivors listening, they still very much have legal rights against the Boy Scouts and against their local council. And those rights will not be extinguished.”
This segment aired on February 18, 2020.