On Thursday, the Supreme Court declined to temporarily halt a bankruptcy plan for the Boy Scouts of America (BSA) while an appeal against the plan continues in a federal appeals court. A group of childhood sexual abuse survivors had approached the justices earlier this month to halt BSA’s bankruptcy plan, but the Supreme Court, without any public dissents, rejected their plea. This previously undisclosed piece of information was reported by Amy Howe on SCOTUS blog.
In response to tens of thousands of child sexual abuse lawsuits, BSA made financial arrangements for bankruptcy in February 2020 and after two and a half years of negotiations, a bankruptcy court in Delaware approved a $2.5 billion plan. This plan designated a trust to channel all sexual abuse claims against BSA, as well as those against local Boy Scouts councils and supporting organizations which did not file for bankruptcy.
The dealings with the bankruptcy court have not been smooth. A group of 144 victims of sexual abuse with claims against the local councils and organizations intended to stave off the enforcement of the bankruptcy plan. When unsuccessful in the lower courts, they engineered an appeal to the Supreme Court. They posited that their case was under review in the Supreme Court’s consideration of a challenge to a multi-billion dollar bankruptcy plan for Purdue Pharma, the makers of the opioid OxyContin, which parallels their own situation against BSA.
BSA has conveyed its deep regret for the abuse victims and their experiences as scouts. But it maintained its recommendation for the Supreme Court to allow the plan to proceed, as concluded by the bankruptcy court, since this was the only viable solution to provide meaningful recovery to survivors. Moreover, it was added that the plan will pay all claims in full concerning Scouting-related abuses, including those 144 victims challenging the plan.
Regardless of the Supreme Court’s decision in the Purdue Pharma case, the victims’ appeal will be considered in light of this decision by the U.S. Court of Appeals for the 3rd Circuit. For both BSA and the victims, the decision carries crucial implications in terms of rectifying past wrongdoings and moving forward.