Boy Scouts of America moves to begin settlement trust procedures

By Sarah Lizee

Olympia, Wash., March 1 – Boy Scouts of America (BSA), the official committee of tort claimants, the future claimants representative and the Coalition of Abused Scouts for Justice are seeking court approval to start settlement trust procedures, according to a motion filed Tuesday with the U.S. Bankruptcy Court for the District of Delaware.

The order would allow the debtors to advance $1 million in cash to aid in the establishment of a settlement trust prior to consummation of the BSA’s plan.

It would also authorize the firm Pachulski Stang Ziehl & Jones LLP to advance funding of at least $2.91 million prior to consummation of the plan. This funding represents amounts the firm holds in escrow under its agreement to contribute 10% of the fees it would otherwise be paid by the debtors to the settlement trust.

The order would also allow the future trustee and future claims administrators to undertake activities and incur the expenses under a proposed budget.

The BSA said the work contemplated by the motion will facilitate the occurrence of the plan’s effective date, the establishment of the settlement trust and the planning necessary before abuse claims can be evaluated and liquidated post-effective date.

“Survivors did not anticipate (nor could they have reasonably anticipated) that nearly a year after the start of the hearing on confirmation of the plan, the effective date would not have occurred,” the movants said.

“Once the effective date occurs, distributions to the holders of allowed abuse claims cannot begin until the settlement trust has been established and the settlement trust officers begin to evaluate more than 80,000 abuse claims.”

Boy Scouts of America is based in Irving, Tex. It filed bankruptcy on Feb. 17, 2020 under Chapter 11 case number 20-10343.

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