Insurance Co. Settles for $800M in Boy Scouts Bankruptcy Case, Opponents Say 'Grossly Unfair'
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Attorneys for the parties involved in the Boy Scouts of America (BSA) bankruptcy case have reached a tentative settlement in which one of the organization's largest insurers would contribute $800 million into a fund for victims of child sexual abuse.
For agreeing to contribute the money into the proposed trust fund, Century Indemnity Co. would be released from any further liability.
The ultimate agreement would amount to more than $2.6 billion, which would be the largest sexual abuse settlement in U.S. history.
The news of the deal comes as 82,000 sexual abuse claimants must decide by Dec. 28 whether to approve a previously announced BSA reorganization plan.
Under the plan, the BSA and its 272 local councils would also contribute up to $820 million in cash, property, and certain insurance rights into a fund for victims. In return, the local councils and national organization would be released from any further liability.
The Associated Press reported the plan also includes settlement agreements with The Hartford, one of the Scouts' major insurers, and the BSA's former largest troop sponsor, the Church of Jesus Christ of Latter-day Saints, more commonly known as the Mormon church. The Hartford has agreed to pay $787 million into the victims' fund, and the Mormons have agreed to contribute $250 million. In exchange, both the insurance company and the church would have no other liability involving child sex abuse claims.
The Century Indemnity agreement also would provide for additional contributions from the BSA and its local councils on behalf of chartered sponsoring organizations.
"This is an extremely important step forward in the BSA's efforts to equitably compensate survivors, and our hope is that this will lead to further settlement agreements from other parties," the Boy Scouts said in a statement. "In addition to our continued negotiations with other insurers, the BSA has worked diligently to create a structure that will allow the Roman Catholic-affiliated churches and United Methodist-affiliated churches who sponsored Scouting units to contribute to the proposed settlement trust to compensate survivors."
Attorneys with the Coalition of Abused Scouts for Justice, which represents about 18,000 abuse claimants, said in a statement that the Century settlement is another reason for victims to vote for the BSA's reorganization plan.
"Not only is the coalition creating the biggest possible compensation fund for survivors — it's the only fund on the table, and it vanishes with a 'no' vote," said attorney and coalition co-founder Anne Andrews. "The coalition also continues to work with the Boy Scouts of America on accountability and safety measures to ensure that no child will have to endure the horrific harm and abuse our clients have suffered."
Opponents of the plan, including the official abuse claimants committee appointed by the U.S. bankruptcy trustee, said the plan is "grossly unfair" and represents only a fraction of the settling parties' potential liabilities and what they should and can pay.
According to the Associated Press, the committee has said the settlements with local Boy Scout councils would leave them with more than $1 billion in cash and property above what they need to fulfill the scouting mission.
As CBN News reported in September, a number of churches and other religious groups were concerned about the liability they could face in the lawsuits after sponsoring local Scout troops.
Three Years Ago, More Parents Began to Ditch Scout Program, Opting for Christian Alternative
The BSA, based in Irving, Texas, filed for Chapter 11 bankruptcy in February of 2020 after hundreds of sex-abuse lawsuits were filed against them.
But a little more than a year earlier before the lawsuits were announced, Christian parents said they were concerned over the program's downward moral spiral and were opting for a faith-based alternative like Trail Life USA.
Launched in 2014, Trail Life USA now has more than 30,000 boys participating in its faith-based program across the United States.
The BSA, which once upheld traditional family values, has now become aligned with the LGBT movement. Roughly 20 years after winning a Supreme Court decision banning openly practicing homosexuals, the organization opened up its doors to transgendered boys as well as biological girls.
Since lifting its ban on gay youth, the BSA reportedly lost two million members, according to The Christian Post.
"The Boy Scouts kind of lost their way; they were an organization that has given us presidents and senators and astronauts and community and civic leaders," Trail Life USA CEO Mark Hancock told CBN News last September. "They had a magic sauce; they had the magic for how to grow boys into good strong men."
"But they began to abandon those traditions through the changes that they made over the last couple years, and I think the families said, 'No, we want an organization that understands that boys and girls are different,'" he continued.
'"We want our sons to be raised in an organization that's male-focused, that helps them to understand and to be encouraged to grow into winning and godly men,'" Hancock added.
"It's who we are, and it's really what makes us different," he explained. "If we cease to do that there's no reason for us to exist. And we also in our hearts, we want to see the Kingdom grow. We want to see boys impacted for Christ."
"We want to see boys and families making decisions for Christ," the Trail Life CEO said. "And we see that basically on a daily basis."
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