Boy Scouts’ Insurer Seeks More Scrutiny of ‘Tainted’ Abuse Claims

The Boy Scouts of America is facing its insurers’ renewed concerns over sexual abuse claims against the bankrupt organization following a plaintiff attorney’s recent statement that his signature was used in claim filings without his “knowledge or permission.”

More investigating is needed to examine the more than 80,000 claims of sexual abuse lodged against the nonprofit to make sure its proposed process for establishing a victims’ trust isn’t “controlled by the votes of claimants with illegitimate claims,” the Hartford Accident and Indemnity Company said in a letter Tuesday to the U.S. Bankruptcy Court for the District of Delaware.

Century Indemnity Co. also has been spearheading efforts to investigate the abuse claims.

The insurers, who would potentially be on the hook to pay billions under legacy coverage policies, said the deal with abuse victims is the product of “closed door meetings” from which they were excluded.

Hartford Accident, a unit of Hartford Financial Services Group, points to an Aug. 9 court filing by a plaintiff lawyer, Tim Kosnoff of Kosnoff Law PLLC.

Kosnoff said that another law firm representing men who were sexually abused as scouts digitally signed his name to dozens of claims filed in the Chapter 11 case even though he only authorized the firm for one specific claim.

Kosnoff’s filing, submitted in response to a court order from Judge Laurie Selber Silverstein, detailed how he joined forces with lawyers at two other plaintiffs’ firms to conduct outreach to abuse victims and take them on as clients in the months preceding the Boy Scouts bankruptcy filing in February 2020.

Kosnoff stated that their advertising caught the attention of other law firms, particularly those that specialize in mass tort cases. Those other firms didn’t necessarily follow the same “bedrock principles” for taking on abuse claimants as clients, he said.

Kosnoff’s statement showed “proofs of claim tainted by fraud” and “the recruitment of legally invalid claims,” Hartford said, looking to bolster its pending bid to investigate the claim filing process that took place after the Chapter 11 proceedings began. The process resulted in a 55-fold increase of claims, the insurer said.

Kosnoff told Bloomberg Law that he has no reason to believe any claims filed using his name were fraudulent. “They just didn’t have my permission to sign them,” he said.

“This is the objective of the insurance carriers. They don’t want to pay,” he added. “I don’t know what their end game is besides perhaps end the Boy Scouts of America without getting blamed for it.”

The filings come just before an Aug. 12 hearing to approve a deal—struck between the Boy Scouts and attorneys representing more than 60,000 abuse claimants—that could advance the organization’s bid to emerge from bankruptcy.

The deal would provide victims with $850 million contributed by the Boy Scouts and its nationwide network of local councils, and assign over to them insurance liability rights.

The case is In re Boy Scouts of America, Bankr. D. Del., No. 20-10343, letter filed 8/10/21.