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Boy Scouts’ Liability Insurers Challenge Sex-Abuse ‘Claim-Mining’

Sara Randazzo and Andrew Scurria write in this morning's Wall Street Journal that the Boy Scouts of America’s liability insurers threw doubt on the huge increase in sex-abuse claims filed against the youth organization after it filed for bankruptcy, claiming that plaintiffs’ attorneys and for-profit claims generators helped gin up tens of thousands of claims with little or no vetting.

The WSJ notes that in Friday court filings, insurers affiliated with Chubb Ltd. and Hartford Financial Services Group Inc. point to messaging such as an email sent in November by the law firm Junell & Associates PLLC, telling clients that “time is quickly running out” to meet a court-designated deadline and that lawyers “can complete a claim form on your behalf,” based on information from an initial phone consultation.

The Boy Scouts bankruptcy case marked the first nationwide mass-tort case fueled by sex-abuse claims. It touched off a marketing campaign aimed at abuse survivors, encouraging them to step forward through television commercials, text-message blasts and social media advertising.

By a November deadline, more than 95,000 claims had been filed. Victims are looking for much of their compensation to come from insurance companies that wrote policies for the Boy Scouts decades ago, when most of the abuse occurred.

The article quotes David Molton, a lawyer for the coalition, who said the insurers’ filings were the latest in a string of attempts to misdirect attention from the sexual abuse inflicted on boys and to attack survivors and their advocates.

“The predators who were allowed to infect the Boy Scouts for many decades created a population of tens of thousands of sexual abuse victims and survivors, resulting in tens of billions of dollars of harm, pain and liability” for which the coalition believes the Boy Scouts and their insurers are responsible, Molton said.

“There are powerful incentives for victims’ lawyers to file as many claims as possible. The more claims a law firm brings in, the more influence it can have over deal talks,” write Randazzo and Scurria. “The Boy Scouts have proposed creating a compensation trust to administer payments to abuse survivors, though it isn’t clear how much victims could recover under such an arrangement, which they would vote on before it is considered in bankruptcy court.”

The Boy Scouts said in a statement the organization was deeply sorry for abuse suffered in scouting and reiterated a pledge to provide victims with equitable compensation through the bankruptcy process.

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