Insurers Say ‘Bazooka’ Of Bogus Boys Scouts Claims Is Abuse Of Bankruptcy System

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A group of insurers — including subsidiaries of AIG, Liberty Mutual, Allianz, Sompo International and Travelers — are challenging the approval of the Boy Scouts of America’s $2.46 billion bankruptcy reorganization plan to allow the organization tens of thousands of claims for sexual assault. to settle abuse.

According to the 125-page document filed in the U.S. District Court for the District of Delaware, the insurers are collectively asking the court to reverse the bankruptcy plan because claims have risen, they said, by 6,000% to more than 82,000 since the bankruptcy filing — and a “significant portion is likely to be fraudulent.”

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“This court cannot tolerate the bad faith, collusion and outright fraud by plaintiffs’ counsel that led to this plan — conduct to which BSA was willfully blind at best,” the insurers — more than a dozen in all — said in the statement. declaration. “Pointing out a bazooka with 82,000 claims to insurers” is an abuse of the bankruptcy system, she added.

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Other BSA insurers, subsidiaries of Chubb and The Hartford, have previously agreed to contribute to the plan.

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But insurers in the Nov. 7 filing said the plaintiffs’ attorneys “viewed the bankruptcy as an opportunity for a windfall, launched a massive advertising campaign filled with false statements, and began hiring plaintiffs on unforeseen charges.”

“The attorneys themselves have signed and filed thousands of proof of claim in the bankruptcy, under penalty of perjury, that contain missing or inaccurate information, often without ever reviewing the forms or contacting the plaintiffs,” the insurers claim in the statement. submission.

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In addition, the plan does not give the insurers a fair trial to monitor or participate in the claims, leading to the outcome “designed to lead to claim values ​​higher than those that would have been produced in the tort system.”

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