UNITED STATES
Bloomberg
December 5, 2018
By Allison McNeely, Josh Saul and Eben Novy-Williams
USA Gymnastics, under threat of being decertified by the U.S. Olympic Committee, filed for bankruptcy after running short of funds to pay victims of Larry Nassar’s sexual abuse.
The organization filed for Chapter 11 status in the Southern District of Indiana on Wednesday with estimated total assets and liabilities of $50 million to $100 million, according to a court filing. USAG aims to continue operating while it settles the victims’ claims, which its says are covered by insurance previously purchased by the organization, according to a statement.
But in court filings, USAG said there may not be enough to go around. It estimated the potential impact of these lawsuits at $75 million and $150 million, while the organization has assets of just $6.5 million in cash and investments, and said that the insurance policy might prove insufficient.
“We owe it to the survivors to resolve, fully and finally, claims based on the horrific acts of the past and, through this process, seek to expedite resolution and help them move forward,” chair Kathryn Carson said in the statement.
The bankruptcy extends a tumultuous year for USA Gymnastics, which installed new leadership after the trial of former team doctor Larry Nassar. Nassar was sentenced to 60 years in federal prison on child pornography charges and another 40 to 125 years in prison for a decades-long string of sexual abuse. His victims number more than 150 current and former gymnasts, including several Olympic champions.
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