Boy Scouts of America files for bankruptcy amid wave of child sexual abuse lawsuits

The Boy Scouts of America, one of the country’s most venerable youth organizations, has filed for bankruptcy protection as former Scouts sue over past sexual abuse and the nonprofit’s legal fees climb.

Filed early Tuesday in Delaware, the Boy Scouts’ long-rumored Chapter 11 bankruptcy petition comes as the organization faces a wave of lawsuits from scores of men who say they were abused as children in Scouting programs after several states — including Pennsylvania and New Jersey — broadened or eliminated their statutes of limitations for child sex-abuse crimes.

The Scouts’ bankruptcy filing, a dramatic moment in the 110-year history of the organization, has “two key objectives: equitably compensate victims who were harmed during their time in Scouting and continue carrying out its mission for years to come,” the group said in a statement.

The Boy Scouts intend to use the bankruptcy process to create a Victims Compensation Trust, the statement said.

The Chapter 11 declaration is expected to halt the barrage of lawsuits and establish a deadline for when former Scouts must file claims.

Bankruptcy means that the voices of the survivors of sexual abuse will not be heard in trial court, said Kenneth M. Rothweiler, a Philadelphia-based lead attorney for Abused in Scouting, a group of lawyers suing the Scouts.

“They’ll have their day in court, but it just won’t be their day in court that they will want,” he said. “Everybody’s story is different, and part of the therapy for some of these men is to come out and tell their stories.”

The Scouts organization “cares deeply about all victims of abuse and sincerely apologizes to anyone who was harmed during their time in Scouting. We are outraged that there have been times when individuals took advantage of our programs to harm innocent children,” Roger Mosby, the Boy Scouts’ president and chief executive officer, said in the statement. He said the bankruptcy process would “provide equitable compensation to all victims.”

It is unclear what effect the bankruptcy declaration will have on local scouting chapters, which the Boy Scouts were quick to distinguish from the national group. The Scouts have 17 councils in Pennsylvania and six in New Jersey.

Both the Cradle of Liberty Council representing the Philadelphia region in Pennsylvania and the South Jersey Garden State Council emphasized Tuesday that the local Boy Scout chapters have not filed for bankruptcy.

“Meetings and activities, district and council events, other Scouting adventures and countless service projects are taking place as usual. In short, there should be no change to the local Scouting experience,” both groups said in identical statements.

The councils said they provide programming, financial, facility, and administrative support to local units and Scouts separate from the national organization. The Cradle of Liberty and Garden State councils’ camps, properties, and finances are controlled locally, they said.

Critics say the local chapters can’t be extricated from national leadership.

“They’re constantly dealing with each other on a weekly basis, emailing and interacting," said Rothweiler. "This is definitely a shield measure on behalf of the Boy Scouts, and it’s going to be a big battle in court.”

Rothweiler said the bankruptcy petition may also protect the organization’s assets from lawsuit payouts — a tactic used by some Catholic dioceses embroiled in the church’s sex-abuse scandal.

The Scouts’ most-recent tax filing shows the national organization, with significant real estate throughout the country, holds more than $1.4 billion in assets. Separately, the local scout chapters have $3.3 billion in assets, the Wall Street Journal reported.

Nationwide, Rothweiler said an estimated 2,300 to 2,400 people, including more than 2,000 represented by Abused in Scouting, have filed lawsuits against the Scouts since August 2019. Of the cases represented by Abused in Scouting, more than 60 were reported by scouts from Pennsylvania, and more than 45 by scouts from New Jersey.

“It’s really ballooned, the amount of people we now understand experienced this abuse,” he said. “This has gone on for decades, and we really don’t know how many total abuse victims are going to come forward.”

Last year, Abused in Scouting filed a lawsuit in Philadelphia on behalf of a 57-year-old Luzerne County man who said he was sexually abused starting around age 12 by a troop leader in the 1970s.

» READ MORE: Lawyers announce Philly lawsuit against Boy Scouts of America

In January, attorneys also used New Jersey’s newly expanded civil statute of limitations to sue former Scout leaders in chapters across the country.

A 2012 lawsuit revealed that, for nearly a century, the Scouts organization kept a list at its Texas headquarters of thousands of leaders who were suspected of preying on young boys and were kicked out of scouting. Lawyers have since said they have identified hundreds more abusers not listed in the “perversion files,” alleging the Boy Scouts have a “pedophilia epidemic within their organization.”

» READ MORE: Boy Scouts kept a list of suspected predators for nearly a century

Before filing for bankruptcy, the Boy Scouts attempted to mitigate the mounting legal costs over sex-abuse claims. In 2018, the Scouts sued six of their insurers, saying they improperly refused to cover some of the group’s liabilities. In November 2019, the Scouts raised their membership costs by more than 80%, citing an increase in liability costs.

The Boy Scouts organization says more than 130 million people have participated in its programs, which foster outdoor education, leadership, and community involvement. The group now has 2.2 million members — about half the number in the 1970s.

In recent years, the organization has moved to broaden membership, opening its doors to openly gay scouts, openly gay scout leaders, and girls.

The Scouts’ previous exclusion of gay members had led to a fraught relationship with the City of Philadelphia. In 2013, the Cradle of Liberty Council vacated its longtime headquarters — a city-owned building in Logan Square — over a legal battle with then-Mayor Michael Nutter over allowing openly gay leaders and members into its ranks.

But the Boy Scouts’ national membership has declined by more than 26% over the last decade, accelerated in 2018 after the Church of Jesus Christ of Latter-day Saints — the largest participant in the program in the United States — severed ties with the Scouts so the church could form its own scouting program. The church made up nearly 20% of the organization’s youth membership.