USA Gymnastics files for bankruptcy after Larry Nassar sex abuse scandal 1 NEWS NOW TVNZ
USA Gymnastics is turning to bankruptcy in an attempt to ensure its survival.
The embattled organization filed a Chapter 11 bankruptcy petition today in an effort to reach settlements in the dozens of sex-abuse lawsuits it faces and to avoid its potential demise at the hands of the US Olympic Committee.
USA Gymnastics filed the petition in Indianapolis, where it is based. It faces 100 lawsuits representing over 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.
Nassar, 55, worked at USA Gymnastics and Michigan State University for decades. He is serving effective life sentences for child porn possession and molesting young women and girls under the guise of medical treatment.
Kathryn Carson, the recently elected chairwoman of USA Gymnastics' board of directors, said the organization's goal is 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."
John Manly, an attorney representing dozens of women who have pending lawsuits against USA Gymnastics, chastised the organization for continuing to "inflict unimaginable pain on survivors" and encouraged law enforcement officials to "redouble" their investigative efforts.