Boy Scouts of America Files Chapter 11 Bankruptcy
As you are probably aware, on February 18, 2020 the Boy Scouts of America filed a “Chapter 11” bankruptcy petition with the US Bankruptcy Court in Delaware. This came about as a result of numerous lawsuits filed across the country alleging that the Boy Scouts of America was aware of sexual abuse occurring within the organization yet failed to act on that information.
In today’s post the Boy Scout sexual abuse lawyer at The Doan Law Firm will discuss how the Boy Scouts’ Chapter 11 filing could affect the abilities of sexual abuse victims to demand compensation for abuse received from sexual predators who used that organization to find new victims.
When a corporation or a business is unable to meet the demands of its creditors, it can file for “reorganization” under Chapter 11 of the Bankruptcy Code. As a part of a Chapter 11 petition the business or corporation must submit a plan describing how it will reorganize and, more importantly, how it will meet its current and any future obligations (such as verdicts and settlements in lawsuits). While a bankruptcy petition is being considered by the court, any current legal actions are suspended until the court makes its ruling. New lawsuits are treated the same way: they can be filed but cannot proceed until the bankruptcy court either 1) approves the reorganization plan, 2) rejects the bankruptcy petition, or 3) converts the Chapter 11 petition to a Chapter 7 filing (“involuntary liquidation,” where all assets are sold to pay the business’ debts).
In the Boy Scouts of America case, the organization filed under Chapter 11 to avoid the possibility that any of its substantial property holdings or other assets could be seized and sold to pay any judgments that could be awarded in current or future sexual abuse lawsuits. Although the details are not yet filed with the court, as part of its reorganization plan the Boy Scouts of America is proposing that it establish a permanent trust fund that will be used to compensate victims of sexual abuse.
When someone is injured as a result of careless or negligence of someone else, the victim has the legal right to file a lawsuit asking a court to order the other party to pay damages. Although each state’s laws are different, every state sets a time limit on how long after an event a victim is permitted to file a lawsuit. These time limits are known as the statutes of limitations. Once a statute of limitations has “run out” or “expired,” a victim cannot file a lawsuit regardless of the extent of their losses and injuries. In most states, personal injury lawsuits must be filed within 2 or 3 years of the date the injury occurred. There are, however, exceptions where a statute of limitations does not apply. Although a statute of limitations may not allow a sexual predator to be charged with a crime, that predator can be named as a defendant in a civil lawsuit.
Many states recognize that victims are reluctant, for any number of reasons, to immediately report sexual abuse. To allow sexual abuse victims to seek justice, most states have changed their laws by either extending the statutes of limitations by several years or by eliminating the statutes altogether if sexual abuse occurred. Since each state sets its own rules for sexual abuse lawsuits, victims must consult an experienced sexual abuse lawyer to protect their legal right to compensation!
By filing its bankruptcy petition, the Boy Scouts of America brought itself time to deal with what could be hundreds of sexual abuse lawsuits. As part of its reorganization plan, the organization will undoubtedly ask the court to override the existing statutes of limitations and set a date after which no new sexual abuse claims will be paid via the proposed trust fund. This means that you must act now to avoid losing your right to compensation!
Many victims of sexual abuse, including former Boy Scouts, will need years of therapy and counseling to overcome the emotional trauma caused by their abusers. The Boy Scouts of America had a legal and moral duty to protect its members from sexual predators. When it failed in that duty, at both the national and local levels of the organization, it became liable for any consequences of that failure.
If you were a victim of a sexual predator while you were a member of the Boy Scouts, we invite you to contact the Boy Scout sexual abuse lawyer at The Doan Law Firm to arrange a free, no obligation, confidential review of the facts in your case and a discussion of the legal options that may be available to you.
When you contact The Doan Law Firm, your case review and first consultation with our Boy Scouts sexual abuse are always free of any charges and do not obligate you in any way to hire us as your legal counsel. Should you decide that a lawsuit is in your best interest after discussing your case with our staff, we are willing to assume full responsibility for all aspects of preparing your Boy Scouts sexual abuse case for trial in exchange for a percentage of the final settlement we are prepared to win for you.
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