Dismissed mediator in bankruptcy of Boy Scouts; Deadline extended

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The judge presiding over the Boy Scouts of America bankruptcy ruled Tuesday dismissing a former Delaware bankruptcy judge as an intermediary and said a Boy Scouts trial had raised questions about his impartiality.

Judge Laura Selber Silverstein has dismissed Kevin Carey as one of the mediators who should help the opposing parties in the case to settle various disputes and reach settlement agreements. “

Mr. Carey is no longer a mediator, ”said Silverstein during a brief online hearing, noting that she had even considered ending the mediation process entirely.

The removal of Carey, who retired as a judge in 2019, leaves only one of the three mediators the judge appointed last year. Another mediator, Paul Finn, resigned three weeks ago. Finn later told The Associated Press that he resigned because “philosophical differences with other parties have existed for some time and can no longer be resolved.”

Silverstein said she was forced to take Carey after the Boy Scouts named him the first “special auditor” in a lawsuit to assist the trustee in overseeing a proposed fund to compensate victims of child sexual abuse.

“This is a non-runner,” said the judge.

“To put it simply, Mr. Carey now has a stake in the outcome of the mediation,” explained Silverstein. “… I think there is a reason to question its impartiality.”

Carey declined to comment.

Under the Boy Scouts’ reorganization plan, the appointment of the special evaluator requires the approval of a group called the Coalition of Missed Scouts for Justice, who are a leading supporter of the plan. The coalition represents nearly 18,000 abuse claimants and is affiliated with more than two dozen law firms, which together represent more than 60,000 claimants. The group has played a dominant role in the bankruptcy despite the existence of an official committee that represents the best interests of all approximately 82,000 abuse claimants. The coalition was also at the center of various disputes over the exchange of information and the design of the reorganization plan and trust-sharing procedures of the BSA.

Based in Irving, Texas, the Boy Scouts filed for bankruptcy protection in February 2020 to set hundreds of individual lawsuits and create a fund for men who claim sexually abused as children. Although the organization faced 275 lawsuits at the time, it now faces more than 82,000 sexual abuse lawsuits in bankruptcy.

The plan calls for the Boy Scouts and their 250 or so local councilors to contribute up to $ 820 million in cash and in kind to a fund for abuse prosecutors. You would also cede certain insurance rights to the fund. In return, the local councils and the national organization would be relieved of further liability for claims of sexual abuse.

The plan also includes settlement agreements between one of the Boy Scouts’ largest insurers, The Hartford, and its former largest troop sponsor, The Church of Jesus Christ of Latter-day Saints, commonly known as the Mormon Church. The Hartford has agreed to contribute $ 787 million to the Abuse Prosecutor’s Fund, and the Mormons have agreed to contribute $ 250 million. In return, both companies would be relieved of any further liability in connection with child sexual abuse lawsuits.

Silverstein agreed on Monday to extend the December 14 voting deadline by two weeks. The renewal comes amid concerns from some attorneys, and the judge herself, that an email and letter distributed last month by attorneys for the Official Committee on Abuse Defenders may have caused confusion and spoiled the voting process. BSA attorneys have also suggested that an extension would allow more time to try and negotiate additional settlements.

Meanwhile, BSA attorney Jessica Lauria Silverstein announced last week that as of Nov. 24, only 4,300 abuse claimants had voted.

The email and letter that raised concerns about the voting process were sent on behalf of attorney Tim Kosnoff, a vehement opponent of the plan, who is calling on his clients to vote against it. The problem is that Kosnoff shares these clients with two other law firms, one of which is pressing the same clients to vote for the plan.

Lawyers on the official committee, which also rejects the BSA plan as “grossly unfair”, sent Kosnoff’s email and a letter to around 12,900 abuse prosecutors for whom he is co-lawyer, but incorrectly added more than 7,500 other recipients, including other law firms and plaintiffs represented by other lawyers.

Boy Scouts and Coalition lawyers claim the email and letter caused confusion among abuse prosecutors and disrupted the voting process. They also allege that the committee’s lawyers acted willfully.


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