Boy Scouts' bankruptcy proves more profitable for attorneys than abuse survivors: report

Boy Scouts' bankruptcy proves more profitable for attorneys than abuse survivors: report
Noah Wulf / Wikimedia Commons

The massive case brought against Boy Scouts of America (BSA) has proven favorable for victims where accountability is concerned. However, the breakdown of the financial compensation is a bit different.

According to USA Today, the 82,000 sexual abuse survivors will each receive less than $10,000 in compensation while the attorneys working the case have billed a staggering $1,725 an hour up to more than $200,000 for legal services and are projected to earn nearly $1 billion.

"The case is unprecedented for bankruptcy litigation related to sexual abuse in the number of survivors filing claims (82,000), the overall amount of proposed settlement funds ($1.8 billion) and now in the proportion going to fees for everyone from attorneys to financial advisers – even lobbyists tapped by the Scouts to ward off bankruptcy reforms," USA Today writes.

BSA also offered estimations for the bills it will receive from its own professionals in addition to the individuals employed by the official creditors’ committees. By the end of the year, the total for those professionals could be upward $205 million. BSA will also contribute $219 million to the trust set aside for survivors

Per USA Today, here is a breakdown of the top recipients of the lawsuit based on billing:

  • The two law firms that have led Boy Scouts’ legal team, White & Case LLP and Sidley Austen LLP, together have billed the nonprofit more than $26 million.
  • Screening claims and coordinating payouts requires other specialized teams, with costs expected to reach about $180 million.
  • Attorneys who represent victims typically work on contingency of one-third of a potential settlement, and as high as 40%, which would amount to at least $400 million.
  • The Coalition for Abused Scouts for Justice, which says it represents 63,000 survivors, stands to receive $950,000 a month in fees and a lump sum payment of $10.5 million.

In a recent statement, BSA noted that it “engaged 535 Group to help consult government officials related to pending legislation.”

“As a Congressionally chartered organization, it is appropriate that the BSA has a means to communication with elected officials, particularly at this pivotal time in our financial restructuring,” the statement continued, “and this requires the retention of registered lobbyists.”

The latest report follows multiple law firms' reactions to the ruling regarding compensation for survivors.

“I am pleased that both the BSA and their local councils have stepped up to be the first to compensate the survivors,” Rothweiler said in a statement. “We will now negotiate with the insurers and sponsoring and chartering organizations who have billions of dollars in legal exposure, of which a substantial portion is necessary to fairly compensate the survivors.”

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