USA Gymnastics files for bankruptcy

In an announcement from yesterday, USA Gymnastics reported that it has filed for Chapter 11 bankruptcy in an Indiana court.  The move comes as the group looks to reorganize following a spate of lawsuits involving around 350 athletes in courts around the U.S.  The lawsuit will not impact the money that victims and potential victims could receive. 

According to the organization's statement, “We owe it to the survivors to resolve, fully and finally, claims based on the horrific acts of the past and, through this process, seek to expedite resolution and help them move forward.  Our sport is safer and stronger thanks to the bravery of these women. The Chapter 11 filing and the expedited resolution of these claims are critical first steps in rebuilding the community’s trust."

It added, "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."

USA Gymnastics' former team doctor, Larry Nassar, was convicted on multiple accounts of child sexual abuse and was sentenced to 60 years in a federal prison in July of last year.  Since then, there have been additional claims filed against him, as well as the gymnastics organization, which is alleged to have not done enough to control his actions.

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