The Boy Scouts of America urged victims to come forward Tuesday as the 110-year-old organization filed for bankruptcy protection in the first step toward creating a compensation fund for potentially thousands of men who were molested as youths decades ago by scoutmasters or other leaders.
The organization resorted to Chapter 11 in hopes of surviving a barrage of lawsuits, many of them made possible by recent changes in state laws to allow people to sue over long-ago sexual abuse.
Bankruptcy will enable the organization to put those cases on hold for now and continue operating.
Tuesday's filing is not expected to affect the Quapaw Area Council, the largest regional council in Arkansas in membership and coverage area, according to the Boy Scouts of America. The council serves 39 counties in the state.
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"Scouting programs will continue throughout this process and for many years to come," the Boy Scouts wrote in a statement sent Tuesday afternoon to the Arkansas Democrat-Gazette. "Local Councils are not filing for bankruptcy as they are legally separate and distinct organizations."
No one from the Quapaw Area Council spoke publicly about the bankruptcy announcement.
The Boy Scouts of America faces the sale of some of its property holdings, including campgrounds and hiking trails, to raise money for a victims fund estimated to top $1 billion.
The Boy Scouts estimated 1,000-5,000 victims will seek compensation.
"The [Boy Scouts] encourages victims to come forward to file a claim as the bankruptcy process moves forward," the organization said in a statement.
More than 12,000 boys reportedly were molested by 7,800 abusers since the 1920s, according to Boy Scout files revealed in court papers.
Evan Smola said two new victims had already called his Chicago law office Tuesday morning, raising the firm's total to 319.
"The opportunity to tell your story is a cathartic and healing experience," Smola said. "It's very painful when they actually do it, but getting it off your chest is a big step."
It will be up to the court to set a deadline for filing claims.
The filing in Wilmington, Del., listed assets of $1 billion to $10 billion and liabilities of $500 million to $1 billion.
"We are outraged that there have been times when individuals took advantage of our programs to harm innocent children," said Roger Mosby, the Boy Scouts' president and CEO.
The Boy Scouts organization is the latest major American institution to face a heavy price over sexual abuse. Roman Catholic dioceses across the country and schools such as Penn State and Michigan State have paid out hundreds of millions of dollars in recent years.
The number of young people taking part in scouting has dropped below 2 million, down from a peak of more than 4 million during the 1970s. Membership rolls took a big hit Jan. 1 when The Church of Jesus Christ of Latter-day Saints cut ties and withdrew more than 400,000 Scouts in favor of programs of its own.
The financial outlook worsened last year after New York, Arizona, New Jersey and California relaxed their statutes of limitations to make it easier for victims to file claims. Teams of lawyers across the U.S. have been signing up clients by the hundreds to sue the Boy Scouts.
Most of the new cases date to the 1960s, '70s and '80s, before the Boy Scouts adopted mandatory criminal background checks, abuse-prevention training for all staff members and volunteers, and a rule that two or more adult leaders must be present during all activities.
In the crush of lawsuits, the Scouts organization recently mortgaged some of its major properties, including the national headquarters in Irving, Texas, and the 140,000-acre Philmont Ranch in New Mexico.
One unanswered question is whether the Boy Scouts' 261 local councils -- and their campgrounds and other assets -- will be dragged into the case, even though the Boy Scouts said the councils are legally separate entities and they were not part of the bankruptcy filing.
Mike Pfau, a Seattle attorney whose firm is representing scores of men nationwide, said the plaintiffs may go after the local councils' property holdings, too.
"We believe the real property held by the local councils may be worth significantly more than the Boy Scouts' assets," he said. He said one question will be whether the Boy Scouts transferred property to their local councils to try to put it out of the reach of those suing.
Information for this article was contributed by David Crary, Brady McCombs and John Mone of The Associated Press and by Tony Holt of the Arkansas Democrat-Gazette.
A Section on 02/19/2020