The Scouting Settlement Trust announced September 19, 2023 that it had begun making payments to claimants.  About 60 payments totaling over $150,000 were made.  These were payments made to claimants who selected the "quick pay" fixed payout of $3,500.  About 7,000 claimants selected this option.  Click here for more details.  

The Wall Street Journal reports that opponents of the Boy Scouts of America bankruptcy settlement plan want it temporarily blocked until after the U.S. Supreme Court considers the Purdue Pharma bankruptcy plan.  Last month the Supreme Court determined that it would review whether bankruptcy law can be used to resolve creditor claims against third parties who are not in bankruptcy without the consent of all claimants.  Those releases are central to the plans in both the Purdue Pharma and Boy Scout bankruptcies.  Click here for the article.  

Two claimants groups seeking a stay of the implementation of the BSA Bankruptcy Plan were directed to file their motions with the U.S. District Court for Delaware before the U.S. Court of Appeals for the Third Circuit could consider their requests.  Those claimant groups and a group of insurors have filed motions to stay the plan implementation with the district court.  The BSA and certain settling insurors have responded to the motions.  Replies are due by September 15, 2023.  

On Wednesday, August 16, 2023, the Dumas & Vaughn Claimants renewed their motion with the U.S. Court of Appeals for the Third Circuit to stay the implementation of the BSA reorganization plan.  They joined the Lujan Claimants, in requesting the stay in light of the U.S. Supreme Court deciding to hear arguments in the Purdue Pharma case regarding whether the Bankruptcy Code authorizes releases against third party non debtors.   That case is to be heard in December 2023.  The Dumas & Vaughn Claimants seek expedited review by the Court of Appeals.  

On Wednesday, August 16, 2023, the Lujan Claimants renewed their motion with the U.S. Court of Appeals for the Third Circuit to stay the implementation of the BSA reorganization plan.  They requested the stay in light of the U.S. Supreme Court deciding to hear arguments in the Purdue Pharma case regarding whether the Bankruptcy Code authorizes releases against third party non debtors.   That case is to be heard in December 2023.  The Lajan Claimants argue that the stay is also appropriate because the Settlement Trust has paid no survivors and has not provided access to documents to support their claims and for them to be able to decide whether to choose the Independent Review Option among other reasons.  

The U.S. Supreme Court agreed on August 10, 2023 to consider a challenge to the Purdue Pharma bankruptcy settlement.  The challenge argues that the family behind Purdue Pharma should not be able to take advantage of legal protections meant for debtors in "financial distress."  Federal appeals courts are split on the issue.  Challengers argue that the deal “applies to an untold number of claimants who did not specifically consent to the release’s terms,” a deal that “constitutes an abuse of the bankruptcy system, and raises serious constitutional questions.”  The Court will hear arguments in the case this December.  See, e.g., New York Times article.

The Department of Justice and the Office of the U.S. Trustee asked the U.S. Supreme Court on July 28, 2023 to halt Purdue Pharma from proceeding with a bankruptcy settlement that protects the company’s owners, the Sackler family, from lawsuits, reports Reuters. The DOJ argued that Purdue should not be allowed to move forward with its restructuring before the Supreme Court weighs in on legal protections for non-bankrupt entities, an issue that has divided bankruptcy courts across the U.S. Last week, an appeals court ruled that Purdue may proceed with a plan approved in May that would shield the Sacklers from opioid related lawsuits in exchange for a $6 billion contribution to the company's broader bankruptcy settlement.

A U.S. Bankruptcy Court ruled that nine sex abuse claims in the Roman Catholic Diocese of Rockville Centre Chapter 11 bankruptcy case were disallowed because of the participation of the diocese in the settlement of the the Boy Scouts of America bankruptcy case.  

In a March letter addressed to all local lodges from Grand Exalted Ruler Bruce A. Hidley, the fraternal organization announced that it will end its official relationship as a charter organization with the Boy Scouts of America.

“After nearly two years of discussions and negotiations with the BSA, at every level, our exhaustive efforts to secure adequate insurance coverage have failed, and our attorneys and insurance broker, Gallagher, have advised that the insurance offered by the BSA falls far short of that needed to adequately protect our Members, Lodges, State Associations and Grand Lodge and will likely lead to future disputes,” the letter stated.

Click here for a related article.  

On the morning of April 19, 2023, the U.S. Court of Appeals for the Third Circuit denied the emergency motions for a stay pending “resolution of all appeals.”  The order denying the emergency motions was docketed without an opinion.  The BSA Bankruptcy Plan became effective today, April 19, 2023.  Click here for the notice filed today in the U. S. Bankruptcy Court for the District of Delaware.