The Supreme Court has authorized a $2.5 billion bankruptcy settlement by the Boy Scouts to move forward in lower federal courts. The decision, issued on Thursday, paves the way for the ongoing litigation of the settlement among the involved parties. Justice Samuel Alito had previously put a hold on the settlement while the court deliberated.
A faction of 144 plaintiffs had sought to obstruct the settlement, but the recent ruling by the court ensures that the settlement process will persist. These plaintiffs represent only a fraction of the 82,000 individuals who filed claims for compensation in the Boy Scouts of America’s bankruptcy proceedings.
They had petitioned the court to halt the bankruptcy settlement, contending that it unjustly bars them from pursuing legal action against non-bankrupt entities, such as churches that sponsored scouting programs and local Boy Scout councils.
Doug Kennedy, an abuse survivor who co-led the official committee representing abuse claimants in bankruptcy, called the delay a “horrible” result. Survivors have already waited for decades for their abuse to be addressed, and 86% of abuse survivors voted to support the Boy Scouts settlement in bankruptcy court, Kennedy said. “There was finally a light at the end of the tunnel, and now this has been yanked away from them,”
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The bankruptcy deal of the Boy Scouts of America was affirmed by a federal judge in the U.S. District Court of Delaware in March of last year. This plan permits the organization, headquartered in Texas, to remain operational while compensating survivors of sexual abuse.
The Boy Scouts filed for bankruptcy in 2020 after the enactment of several laws that extended the statute of limitations for individuals to file lawsuits over abuse allegations from decades past. Subsequently, the organization reached a settlement that received court approval in 2022. Under the terms of the settlement, abuse survivors stand to receive compensation ranging from $3,500 to $2.7 million.
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Adam Slater, a legal representative advocating for claimants in support of the settlement, expressed satisfaction with the Supreme Court’s decision. “With more than 12,400 survivors in this case over the age of 70 and more than 2,200 over the age of 80, these courageous individuals deserve to receive compensation during their lifetimes,” Slater remarked.
Justice Samuel Alito had previously imposed a stay on the settlement while the court deliberated. The settlement plan garnered overwhelming support, with over 86% of the 82,000 victims of sexual abuse within the Boy Scouts of America voting in its favor.
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The Boy Scouts of America noted that Alito’s order was only a short-term measure and said that it hoped the Supreme Court would swiftly deny the request for a longer pause, which would “inflict severe harm on both the Scouting movement and Scouting abuse survivors.”
Gilion Dumas, a lawyer representing 67 of the men who challenged the settlement, said, “Our sex abuse claimants are excited that the Supreme Court issued this stay, even if it is only temporary.”
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