The Boy Scouts of America will receive more than $1 billion from its primary insurer and The Church of Jesus of Latter-day Saints in a tentative agreement to resolve sexual abuse claims of thousands of men who say they were molested decades ago by scoutmasters and others.
Under the agreement, insurance company The Hartford will pay $787 million into a fund to be established for the men, the company said in a news release Tuesday. In exchange for the payment, the Boy Scouts and its local councils will fully release The Hartford from any obligation under policies the insurance company issued to them.
Under a separate settlement, The Church of Jesus Christ of Latter-day Saints has agreed to pay $250 million into the fund for abuse claimants. The church, based in Salt Lake City, was the largest single sponsor of Boy Scout troops before ending its longtime partnership with the organization at the beginning of last year.
“This has been a prolonged process that included — as one of many interested parties — The Church of Jesus Christ of Latter-day Saints as a former sponsoring organization. This contribution will provide opportunities to alleviate the suffering of those who have experienced abuse,” church spokesman Eric Hawkins said in a statement.
“The Church of Jesus Christ of Latter-day Saints condemns abuse of any kind. We express our love and concern for those who have experienced abuse through Scouting or any other circumstance.”
The proposed settlements are part of an ongoing effort by the Boy Scouts, which declared bankruptcy in February 2020, to forge a reorganization plan that must win approval by a majority of abuse victims and the court. Attorneys are still trying to negotiate a settlement with the Boy Scouts’ other major insurer, Century Indemnity, according to The Associated Press.
The agreement-in-principle with The Harford was reached in connection with Boy Scouts’ Chapter 11 bankruptcy and will become a final settlement under certain conditions, including execution of a definitive settlement agreement, confirmation of the Scouts’ global resolution plan, receipt of executed releases from the local councils, and approval from the bankruptcy court as part of the Scouts’ overall reorganization plan.
An official victims committee appointed by the U.S. bankruptcy trustee opposes the settlement as do law firms separately representing hundreds of men who have filed sexual abuse claims. Representatives of the official victims committee described the proposed settlements as “grossly unfair,” the AP reported.
”The only winners in this latest proposal are the Boy Scouts, their local councils, the Mormon Church, and the Hartford insurance company,” Michael Pfau, an attorney whose firm represents more than 1,000 abuse claimants in the bankruptcy, said in a prepared statement.
“The Boy Scouts are offering abuse survivors a fraction of what their cases are worth and the assets available to pay them,” Pfau added. “The Mormon church is reported to have roughly $100 billion in assets, but it is offering a paltry $250 million to compensate the thousands of abuse survivors who were abused in Mormon Boy Scout troops by Mormon Scout leaders.”
The new agreement with The Hartford was negotiated after the bankruptcy judge last month rejected two key provisions of an $850 million deal that the Boy Scouts had reached with attorneys representing a majority of abuse claimants, according to the AP.
Judge Laura Selber Silverstein denied the Boy Scouts’ request as part of that deal for permission to withdraw from a previous $650 million settlement it had reached with The Hartford. The Boy Scouts sought to withdraw from that April agreement after attorneys for abuse claimants repeatedly insisted that their clients would never vote for a reorganization plan that included it.
Silverstein also rejected a proposal for the Boy Scouts to pay millions of dollars in legal fees and expenses of attorneys hired by a coalition of law firms that represent tens of thousands of abuse claimants. The judge noted that any such payment would come out of the pockets of abuse claimants themselves, the AP reported.
The new settlement with The Hartford was the product of negotiations that included attorneys representing an ad hoc group called the Coalition of Abused Scouts for Justice. Law firms affiliated with the group represent more than 60,000 sex abuse claimants.
Ken Rothweiler, whose law firm is affiliated with the coalition and represents roughly 16,800 abuse claimants, called the settlements a significant development.
“We also can’t let this matter drag on endlessly in court,” he said.
There are men who were assaulted decades ago who are dying right now, either from old age or because they have died by suicide from their unaddressed trauma, Rothweiler said.
“They’ve waited for justice for far too long, and we want to make sure they receive compensation as early as possible,” he said.
Rothweiler said there are also thousands of survivors whose claims are beyond the statute of limitations in the states where they were abused.
“If the bankruptcy fails and the Boy Scouts of America organization goes into liquidation, a staggering 60,000 people would likely receive no compensation at all. There shouldn’t be two systems of justice for survivors based on what state they happened to be abused in,” he said.
Rothweiler said the coalition was founded on the principle that all sexual abuse survivors deserve to be compensated, and none would be left behind.
The proposed settlements, coupled with the $850 million contribution from the Boy Scouts and local councils, would bring the fund for abuse victims to almost $1.9 billion.
If the plan is approved, it would represent one of the largest sex-abuse settlements in U.S. history. Rothweiler said the amount is going to grow much higher in the coming weeks and months as the coalition negotiates with more insurers and chartered organizations.