Judge Approves $850M Boy Scouts Sex Abuse Lawsuit Settlement

The federal judge overseeing bankruptcy proceedings for the Boy Scouts of America has approved an $850 million child sex abuse settlement which was proposed to resolve tens of thousands of claims filed against national organization, after it was discovered that it failed for years to protect children from sexual predators.

Thousands of Boy Scouts abuse lawsuits have been filed in recent years, alleging that the organization covered up decades of credible reports involving problems with volunteers and employees, maintaining a set of records known as the “perversion files” dating back to 1944.

Facing clear signs of massive liability, a Boy Scouts of America bankruptcy was filed last year, which now includes about 97,000 claims brought by former Boy Scouts and other individuals, claiming they were abused or assaulted as children through negligence of the organization. It is the largest sex abuse case involving a national organization in U.S. history.

This week’s ruling by U.S. Bankruptcy Judge Laurie Selber Silverstein of Delaware grants approval for a settlement agreement reached between the Boy Scouts of America, the Coalition of Abused Scouts for Justice and other groups, allowing the Boy Scouts to emerge from Chapter 11 bankruptcy by the end of the year.

The agreement includes a fund for survivors that will provide about $250 million from the national organization, and another $600 million to be contributed by local Boy Scout councils. The Boy Scouts sex abuse settlement must still be approved by the organization’s creditors.

Insurers, including Century Indemnity Company and Hartford Financial Services opposed the agreement, accusing some of those who claimed they were sexually abused as children of making fraudulent claims. However, Judge Silverstein rejected their arguments, saying the debtors had met the relevant standards for approval of the settlement agreement.

Judge Silverstein noted that her approval of the settlement was limited only to the $850 million plan, known as the Restructuring Support Agreement (RSA), and does not include a $650 settlement agreement involving Hartford, nor a $10.5 million provision relating to legal fees.