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Facing Allegations Of Child Abuse, The Boy Scouts Of America Considers Bankruptcy


Sexual abuse claims against the Boy Scouts of America has the organization considering filing for Chapter 11 bankruptcy protection. The reason - to protect the Texas-based non-profit from financial settlements related to those abuse claims. Bill Zeeble of member station KERA in Dallas reports.

BILL ZEEBLE, BYLINE: To understand what the Boy Scouts of America may be up against, think of the Catholic Church. Dioceses across the country have been rocked by sexual abuse lawsuits costing millions and millions of dollars. Susan Gaertner is a Minneapolis attorney who represented two dioceses in such cases.

SUSAN GAERTNER: It is expected that perhaps before it's all over, all of the dioceses in Minnesota may have filed for bankruptcy.

ZEEBLE: The Boy Scouts reportedly fear that scenario. The Wall Street Journal reports the group has hired a law firm to help a possible Chapter 11 filing. Boy Scouts CEO Michael Surbaugh wouldn't comment for this story. But the Scouts referred me to a letter where he stated, quote, "at no time in our history have we knowingly allowed a sexual predator to work with youth." Sylvia Demarest is a Dallas lawyer who successfully sued the Dallas diocese.

SYLVIA DEMAREST: One of the priests that I sued the Catholic Church over had been a priest who, after he was accused of molesting children, had been allowed to become Boy Scout leader for the Dallas diocese.

ZEEBLE: Demarest joins others who allege that the Scouts have been covering up abuses for years. She says seeking bankruptcy protection makes sense.

DEMAREST: They had insurance coverage for incidents like this for many years. Now these insurance carriers are withdrawing coverage. As a result, the Boy Scouts are faced with the prospect of having to fund all of this litigation, any settlements out of ongoing operations. They may feel they are not in a position to do that.

ZEEBLE: As more alleged victims come forward, lawyer Susan Gaertner says filing for bankruptcy protection could actually help them.

GAERTNER: It is a way to be most fair to the most people. If the first one in the door gets a verdict that essentially drains all the resources, then the rest of the claimants get nothing.

ZEEBLE: In his letter about speculation over Chapter 11 bankruptcy, Boy Scouts CEO Michael Surbaugh says there are no immediate decisions expected. For NPR News, I'm Bill Zeeble in Dallas.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.

Bill Zeeble has been a full-time reporter at KERA since 1992, covering everything from medicine to the Mavericks and education to environmental issues. Heâââ