The Boy Scouts of America has filed for bankruptcy protection as it faces hundreds of lawsuits for sexual abuse. The youth organization, which celebrated its 110th anniversary February 8, listed liabilities of between $100 million and $500 million and estimated assets of $1 billion to $10 billion. Last April, exposed court testimony showed the organization believed more than 7,800 of its former leaders were involved in sexually abusing more than 12,000 children over the course of 72 years.
Several states have changed their laws to temporarily remove statutes of limitations on sexual abuse, which previously protected organizations like the Boy Scouts. At least 12,000 cases of abuse at the hands of Boy Scout masters and volunteers have been identified. In August, the organization referred about 120 allegations of abuse by Scout leaders to law enforcement for further investigation, saying it believes victims and that the youth organization is working to identify “additional alleged perpetrators.”
The organization says it will use the Chapter 11 process to create a trust to provide compensation to victims. Scouting programs will continue throughout. The Boy Scouts had been exploring the possibility of bankruptcy since at least December 2018, when the group hired a law firm for a possible Chapter 11 filing. Chapter 11 usually involves the debtor making a reorganization plan to keep its business alive and pay its creditors over time.
The Boy Scouts also published a carefully worded open letter to victims of abuse. The letter, signed by BSA National Chair Jim Turley, encourages people who were abused to come forward and file claims so they can receive compensation from the trust that will be created. For many years, the Boy Scouts had insurance that would cover sexual abuse claims. But in recent years these carriers have been withdrawing coverage, arguing that the Boy Scouts knew about the abuse and didn’t tell the insurance companies. That has left the organization with the prospect of having to fund any litigation and settlements itself.
The Boy Scouts of America faced hundreds of lawsuits from alleged sexual abuse victims across the country — all of which are now suspended because of the bankruptcy filing. Several of the lawsuits allege repeated fondling, exposure to pornography, and forced anal or oral sex. In response, the Boy Scouts of America said at the time that they “care deeply about all victims of child abuse and sincerely apologize to anyone who was harmed during their time in Scouting.” They added that they were “outraged that there have been times when individuals took advantage of our program to abuse innocent children.”