gymnastics

Indianapolis-based USA Gymnastics filed a voluntary petition for protection under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Indiana on Wednesday.

This filing will enable USA Gymnastics to continue to support its athletes, to fully operate and meet its responsibilities to the entire membership and to expeditiously resolve the claims made by the survivors of sexual abuse perpetrated by Larry Nassar, according to a press release.

Jan. 23, Nassar was sentenced to between 40 and 175 years for sexually abusing girls who came to him for treatment. He had previously been convicted on separate child pornography charges and sentenced to 60 years in prison in December 2017.

The Indianapolis Star broke the Nassar story in September 2016.

The survivors’ claims against USA Gymnastics are covered by insurance previously purchased by USA Gymnastics, and the amount of available insurance proceeds available is not affected by the Chapter 11 filing.

Apart from these insurance proceeds, USA Gymnastics has no other significant assets that could be used to pay claims.

“USA Gymnastics believes that the Bankruptcy Court is the best forum in which to implement appropriate procedures to equitably determine and allocate the insurance proceeds among claimants, allowing compensation to survivors to proceed more quickly than litigation filed in multiple courts around the country,” according Kathryn Carson, who was recently elected chair of the USA Gymnastics Board of Directors.

By staying all pending actions against USA Gymnastics, the Chapter 11 filing also allows USA Gymnastics to work with the United States Olympic Committee to determine the best path forward for the sport of gymnastics.

Carson is one of eight independent and seven membership directors who were elected to a newly created Board of Directors in June 2018. The membership directors include representation for the competitive gymnastics disciplines, athletes and affiliated organizations.

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