Supreme Court Rejects Challenge to $2.46B Boy Scouts Sex Abuse Settlement
The justices turned away an appeal by 144 plaintiffs of a lower court’s decision rejecting their claim that the bankruptcy deal improperly prevented them from suing other organizations that were partly liable for the abuse.
The settlement, reached in 2022 in bankruptcy court in Delaware, granted immunity from lawsuits to those organizations in exchange for contributions to the Boy Scouts bankruptcy settlement. The Supreme Court later ruled that bankruptcy courts lacked the power to wipe away lawsuits against organizations that contributed to settlements but did not file for bankruptcy themselves, but its decision did not apply retroactively to older cases like the Boy Scouts bankruptcy.
After a federal judge ruled against the plaintiffs, the Philadelphia-based 3rd U.S. Circuit Court of Appeals upheld that decision. The 3rd Circuit indicated that disrupting the settlement so long after its approval would be unfair to survivors and the Boy Scouts organization, now called Scouting America.
Scouting America, as well as insurers and abuse survivors who support the deal, had urged the Supreme Court not to take the case, arguing that upending the settlement would have devastating emotional and financial consequences. Scouting America said that it would have to demand money back from abuse claimants who had only just begun receiving settlement money if the deal had been unwound.
The Boy Scouts filed for bankruptcy in 2020 after several U.S. states enacted laws allowing accusers to sue over decades-old abuse allegations, which led to a flood of new lawsuits.
The Supreme Court previously declined to halt the settlement in 2024, instead allowing the deal to move forward while the appeals proceeded in lower courts.
(Reporting by Knauth in New York; Editing by Will Dunham)