The Supreme Court allows the $2.4 billion Boy Scout sex abuse deal to proceed
The Supreme Court on Thursday cleared the way for a $2.4 billion plan to settle sex abuse lawsuits against the Boy Scouts of America.
The court’s brief, unsigned order contained no reasons, which is typical of emergency motions. There were no public disagreements.
A group of victims had asked the court to pause the scheme as judges consider an opioid settlement against Purdue Pharma, the maker of OxyContin, and members of the wealthy Sackler family who owned the scheme, saying that deal raised similar issues.
Like the Purdue Pharma deal, the Boy Scouts deal was settled in bankruptcy court using a controversial mechanism that insulates a third party from future lawsuits even without requiring that party to declare bankruptcy.
In the case of Purdue Pharma, this effectively shields members of the Sackler family from liability in future opioid-related lawsuits.
The Boy Scouts settlement covers more than 82,000 claims of childhood sexual abuse more than 86 percent of the victims in the case supporting the deal.
However, the group that asked the Supreme Court to intervene objected to the use of the mechanism, which protected third parties from liability, such as churches involved in scouting, municipal councils and insurers.
The outcome of the Boy Scouts case was closely watched as a possible clue to which direction the judges might lean in Purdue Pharma. During oral arguments in December, the justices appeared divided, and a decision in that case is expected toward the end of the court’s term, likely in late June.
In asking the court to intervene, the group argued that if the settlement were to go through, sexual abuse victims “will lose their right to pursue their claims independently of the bankruptcy settlement.”
The Boy Scouts did argued that the settlement should proceed as planned, warning that if the judges were to block the deal it would “threaten to plunge the scouting program into chaos.”
The challengers represented “a small portion” of the victims involved in the deal, the Boy Scouts said.
After Judge Samuel A. Alito Jr. had temporarily halted the settlement earlier this month, the bankruptcy judge oversaw the case work on the deal was suspendedwhich has already paid out about $8 million to several thousand victims.
On Thursday, after the court announced its ruling, the trust handling the settlement said it had “resumed all operations, including processing and paying claims.”