USA Gymnastics offers $292 million settlement to Larry Nassar's victims

The plan also included bench marks to ensure that USA Gymnastics improves athlete safety. PHOTO: AFP

(REUTERS/ NYTIMES) - USA Gymnastics said on Thursday (Jan 30) it filed a plan to emerge from bankruptcy that offers the group of survivors who were sexually abused by former national team doctor Larry Nassar a US$215 million (S$292 million) settlement.

The women, as a group, may vote to accept the US$215 million to settle all their claims or pursue their lawsuits and collect any judgments from insurance policies available to the sport's national governing body.

USA Gymnastics also said if the survivors vote to accept the settlement, the insurers for Twistars, a Michigan-based Gymnastics club where athletes said Nassar abused them, will also contribute an additional US$2.125 million to the settlement amount.

Whichever option the women accept will apply to all members of the survivor class.

The plan also included bench marks to ensure that USA Gymnastics improves athlete safety and provided for payments to the organisation's other creditors.

If approved, the plan would allow USA Gymnastics to emerge from bankruptcy.

The offer comes nearly two years after Michigan State University reached a US$500 million settlement with victims of Nassar's abuse.

Nassar worked for the university for about 20 years, and the settlement was believed to be the largest ever reached in a sexual abuse case involving an American university.

"While we do not yet have an agreement with the Committee representing the survivors, we still hope to reach an agreement," USA Gymnastics chief executive Li Li Leung said in a news release.

"USA Gymnastics filed its proposed plan to communicate to the survivor class the two options that are currently available based on the amount of money USA Gymnastics' insurers are willing to pay into a settlement fund."

According to Leung, who was hired last February to help USA Gymnastics navigate the aftermath of a devastating sex abuse scandal, the plan allows for ongoing negotiations among the parties and the governing body are hopeful discussions will lead to an agreement that is supported by all parties in the case.

But its prospects for approval appear dim.

John C. Manly, a lawyer who represents more than 200 athletes who accused Nassar, including the Olympic gymnasts Aly Raisman and McKayla Maroney, criticised the offer, saying it is "not just unworkable, it is unconscionable."

"I'm not in a position to reject it, but in speaking to my clients and other lawyers, there's a better chance of Donald Trump endorsing Bernie Sanders than the victims accepting this offer," Manly said Thursday.

Under the USA Gymnastics plan, Manly said, each of the more than 500 accusers of Nassar would receive about US$250,000 to US$300,000. In the Michigan State settlement, he said, they received an average of US$1.25 million.

Many gymnasts who suffered abuse at Nassar's hands have accused USA Gymnastics of failing to investigate earlier complaints about his misconduct.

The plan of reorganisation was filed with the US Bankruptcy Court for the Southern District of Indiana.

USA Gymnastics filed for bankruptcy in December 2018, saying at the time it was staggering under the weight of lawsuits filed by hundreds of women who were sexually abused by Nassar.

More than 300 plaintiffs, including Olympic gymnasts, have sued USA Gymnastics for failing to protect them from Nassar, who was sentenced in 2018 to 40 to 125 years in prison for abusing girls and women at a gymnastics facility under the guise of medical treatment.

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