Is it dishonorable to file Chapter 11?

Is it dishonorable to file Chapter 11?


It’s the third word in the Boy Scout oath: “Honor.”

The Boy Scouts of America, an organization that built its reputation on perpetuating a well-defined moral code, has sought refuge in bankruptcy court, where promises are broken.

Critics of the Boy Scouts’ Chapter 11 bankruptcy filing on Tuesday say it’s a dishonorable route for the nonprofit, which has proposed paying victims of sexual abuse less than they would have received outside of bankruptcy. Exactly how much less is up in the air.

Defenders say it’s actually an honorable step for the Boy Scouts to face up to its failures, find a path to help compensate victims and stabilize the organization’s finances.

What’s widely agreed upon is that bankruptcy poses a moral conundrum that’s particularly thorny for a group that expects to face about 1,700 claims of sexual abuse dating back several decades. Any victim whose claim is vetted through the judicial process would be entitled to a share of the settlement funds.


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