Alito pauses Boy Scouts $2.46 billion abuse settlement

Supreme Court Justice Samuel Alito temporarily halted the Boy Scouts of America’s $2.46 billion settlement Friday following decades of sexual abuse claims after a group of claimants appealed. 

Alito issued the stay ‘pending further order of the undersigned or of the Court.’ The stay gives the court additional time to decide a February 9 request by the 144 abuse claimants seeking to block the settlement from moving forward. 

The claimants are a small group of the 82,000 who filed claims for payment in the Boy Scouts of America’s bankruptcy. They previously asked the Court to halt the organization’s bankruptcy settlement, arguing that the settlement unlawfully prevents them from pursuing lawsuits against other organizations that are not bankrupt, including churches that ran scouting programs and local Boy Scout councils. 

Retired bankruptcy judge Barbara Houser, the trustee in charge of administering the Boy Scouts settlement, said the order will suspend all work on the settlement, including ‘evaluating claims and mailing checks to abuse survivors,’ according to Reuters. More than 3,000 men have already been paid nearly $8 million by the settlement trust. 

‘This is an administrative stay only and is not a decision on the merits of the plaintiffs’ application for a stay of the plan,’ the Boy Scouts of America told Fox News Digital in a statement. 

‘As BSA’s brief in opposition to the stay application explained to the Court, the BSA plan has already been effective for ten months and will fully compensate all Scouting-abuse survivors. Staying that plan now would inflict severe harm on both the Scouting movement and Scouting-abuse survivors, many of whom have already waited decades for compensation and emotional closure,’ the organization said. ‘We look forward to the Court’s ruling soon on the stay application. We hope the Court will swiftly deny the application and permit the BSA plan’s settlement trustee to resume her work compensating survivors.’

‘They’ve waited a long time to be able to bring claims for their abuse in Scouting,’ Gillion Dumas, one of the lawyers whose firm is currently representing 69 of the claimants, told Fox News Digital. ‘They appealed the Boy Scout bankruptcy because the plan takes away their right to sue sponsoring organizations and local Boy Scout councils – organizations that caused their abuse and are not bankrupt. 

These claimants are excited about the Court’s order. While the order is temporary, it shows that the Supreme Court takes their appeal seriously,’ Dumas said. 

John Reeves, an attorney representing the claimants, told Fox News Digital that temporary stays such as the one issued by Alito only occur ‘in the most extraordinary of circumstances,’ thus demonstrating ‘how seriously he and the other justices are taking the claimants’ argument.’ 

‘Only the national Boy Scouts of America organization has declared bankruptcy, but its bankruptcy plan also discharges non-bankrupt Local Councils and Chartered Organizations from civil liability,’ Reeves said. ‘This is a blatant violation of the claimants’ due process rights. We look forward to further litigating this issue before the Court, and are cautiously optimistic that it will ultimately grant us a full, permanent stay of the bankruptcy plan.’

Fox News Digital has reached out to Dumas for additional comment. 

The bankruptcy deal was upheld by a federal judge in the U.S. District Court of Delaware last March. The plan would allow the Texas-based organization to continue operating while it compensated the sexual abuse claimants. 

The ruling rejected arguments claiming the bankruptcy plan was not proposed in good faith and that it improperly strips insurers and survivors of their rights. 

The Boy Scouts filed for bankruptcy in 2020 following the passing of several laws allowing accusers the opportunity to sue over abuse allegations that were decades old. The organization later reached a settlement that was approved in court in 2022. The settlement would pay between $3,500 and $2.7 million to abuse victims.

Reuters and The Associated Press contributed to this report.