USA Gymnastics’ disclosure statement gets objection from U.S. Trustee

By Sarah Lizee

Olympia, Wash., March 24 – The disclosure statement for USA Gymnastics’ plan of reorganization drew an objection from Region 10 U.S. Trustee Nancy J. Gargula, according to a Tuesday filing with the U.S. Bankruptcy Court for the Southern District of Indiana.

“The disclosure statement does not contain adequate information necessary for claimants to make an informed decision as to whether to accept or reject the plan.,” the objection said.

Specifically, Gargula said the disclosure statement does not include any information, even disputed information, about the settling insurers’ liability limits under the insurers’ insurance policies, and as a result, survivor claimants cannot determine if the settlement election represents a fair deal monetarily as they do not know how much money is potentially available for compensation.

Additionally, the U.S. trustee said the disclosure statement lacks information regarding any value the United States Olympic & Paralympic Committee will contribute to the trust, which would entitle it to a third-party release through the channeling injunction.

It also lacks information regarding the survivors’ claims’ classification, as well as information regarding the trust, Gargula added.

The Indianapolis-based gymnastics organization filed bankruptcy on Dec. 5, 2018 under Chapter 11 case number 18-09108.

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