USA Gymnastics President and CEO Kerry Perry, middle, watches the U.S. Gymnastics Championships, Thursday, Aug. 16, 2018, in Boston. (AP Photo/Elise Amendola)

Abuse settlements force USA Gymnastics to file for bankruptcy

The organization filed a Chapter 11 bankruptcy petition on Wednesday as it attempts to reach settlements in the dozens of sex-abuse lawsuits it faces.

USA Gymnastics is turning to bankruptcy in an effort to ensure its survival.

The embattled organization filed a Chapter 11 bankruptcy petition on Wednesday as it attempts to reach settlements in the dozens of sex-abuse lawsuits it faces and to forestall its potential demise at the hands of the U.S. Olympic Committee.

USA Gymnastics filed the petition in Indianapolis, where it is based. It faces 100 lawsuits representing 350 athletes in various courts across the country who blame the group for failing to supervise Larry Nassar, a team doctor accused of molesting them.

Kathryn Carson, who was recently elected chairwoman of the board of directors, said the organization is turning to bankruptcy to speed things up after mediation attempts failed to gain traction.

“Those discussions were not moving at any pace,” Carson said. “We as a board felt this was a critical imperative and decided to take this action.”

The filing does not affect the amount of money available to victims, which would come from previously purchased insurance coverage, she said. Carson said the insurance companies “are aware we’re taking this action and our expectation is they will come to the table and pay on our coverage.”

Carson added: “This is not a liquidation. This is a reorganization.”

Read more: USOC moves to shut down USA Gymnastics after Nassar scandal

Read more: U.S. gymnastics doctor sentenced to 40 to 175 years in prison

One that USA Gymnastics hopes will buy it enough time to fend off the USOC’s intent to decertify it.

The USOC on Nov. 5 took steps to remove USAG as the sport’s governing body at the Olympic level — a step that’s taken only under the most extreme circumstances. In an open letter to the gymnastics community, USOC CEO Sarah Hirshland said “you deserve better,” and that the challenges facing USA Gymnastics were more than it was capable of overcoming as currently constructed.

Carson said the legal manoeuvring Wednesday delays the USOC’s efforts to strip its designation as a national governing body.

“We always have a dialogue going with them and intend to make it clear with them we have a lot to talk about and we want to keep that going,” Carson said.

USOC spokesman Patrick Sandusky disagreed.

“While we fully understand that USAG believes this restructuring will begin to solve deficiencies we’ve identified, the filing does not impact our Section 8 complaint and that process will move forward,” Sandusky said.

Will Graves, The Associated Press

Like us on Facebook and follow us on Twitter.

Just Posted

Great kids doing great things for Houston

Members of the Houston Minor Hockey and the Houston Ringette canvassed the… Continue reading

Owners of mining project south of Houston allowed to drill again

New Nadina’s free miners certificate had been suspended in September

Council seeks to replace By-Mac Park’s boat launch

The boat launch is currently unusable; district has received several complaints

Houston residents raise concerns over “dangerous” street corner

“Pedestrians casually cross the road on blind corners,” says local resident

Retired B.C. teacher a YouTube Sudoku sensation

A retired Kelowna teacher has amassed quite the following online by teaching the art of solving a Sudoku puzzle.

Stop ‘renovictions,’ B.C. housing task force says

MLAs call for more protection, options for renters

Man caught on camera allegedly trying to defraud ICBC

Auto-insurer warns B.C. drivers to record info after crashes

Girl, 6, lured from elementary school, sexually assaulted: Vancouver police

Police are seeking dashcam footage from nearby Sexsmith Elementary School in South Vancouver

B.C. Liberals call for outside audit of Speaker’s office, NDP refuses

Auditor General implicated in Darryl Plecas accusations of impropriety

Three victims of ex-ski coach Bertrand Charest suing Alpine Canada

The victims are also seeking $150,000 each in punitive damages

Trudeau names four new senators, filling every seat in the Senate

Trudeau has appointed 49 senators since becoming prime minister and will have the chance to appoint more in 2019

B.C. member of parliament takes feds to task on opioid crisis

‘Too many families are tragically losing parents, siblings and children to the opioid crisis.’

Most Read