The U.S. Olympic and Paralympic Committee has filed suit against 10 if its insurance carriers in state court in Colorado as pressure continues to mount against the tax exempt, non-profit organization to settle with the more than 500 survivors who allege they were sexually abused by former U.S. Olympic and USA Gymnastics team physician Larry Nassar, U.S. Olympic head coach Don Peters and other coaches and officials.
The filing comes as legislation that would give Congress expanded oversight of the USOPC including the ability to remove the organization’s board of directors awaits President Trump’s signature.
The USOPC has been named in hundreds of lawsuits related to sexual abuse by Nassar and other coaches and officials.
Attorneys for the USOPC have repeatedly argued in multiple lawsuits that the organization does not have a legal duty to protect athletes who are members of organizations under its umbrella. The stance has been characterized by survivors, Olympians and members of Congress as a major impediment to USA Gymnastics reaching a settlement with the survivors of Nassar and other coaches and officials.
“The USOPC disputes its legal liability for this abuse,” attorneys for the USOPC write in Thursday’s filing against the insurance companies.
The USOPC and USA Gymnastics have also refused to release documents that detail the culture of abuse within the sport that enabled Nassar and Peters and others’ predatory behavior, and the lengths USA Gymnastics and USOPC officials went to conceal that behavior from the public and future victims, according to survivors and attorneys involved in the case.
But on Friday Susanne Lyons, the USOPC board chairman, blamed the organization’s insurance carriers.
“We are going to be filing our own lawsuit against our insurance carriers as part of the gymnastics mediation to achieve a fair and just resolution for the victims and the survivors,” Lyons told reporters after USOPC board meeting. “For more than a year and a half we have actively participated in the mediation process.
“Because the insurance companies, in our belief, have not lived up to their contractual obligations to the USOPC – including not acting fairly and in good faith and exploring whether a reasonable settlement could be achieved – we were forced to file this lawsuit.
“The lawsuit seeks to have a court resolve the issues related to the insurers’ obligations as part of our efforts to achieve a fair resolution for the victims and survivors.”
John Manly, a survivors attorney, described Lyons statements as a “false narrative.”
USA Gymnastics submitted a proposed $217 million settlement offer to survivors in U.S. Bankruptcy court in February.
USA Gymnastics filed for Chapter 11 protection in December 2018.
One of the conditions of the settlement offer was that it would release the USOPC and former USA Gymnastics president Steve Penny and others from “any and all claims arising from or related to Abuse Claims or Future Claims” and the plan’s payment structure that would divide survivors into four categories.
In addition to the USOPC and Penny, the settlement proposal also calls for the release of former U.S. Olympic team coaches Peters and John Geddert, former U.S. Olympic and national team directors Martha and Bela Karolyi, USA Gymnastics senior vice president Rhonda Faehn, former USA Gymnastics board chairman Paul Parilla, former USA Gymnastics president Bob Colarossi, former USA Gymnastics national teams manager Amy White, former USA Gymnastics sports medicine official Debra Van Horn and the All Olympia Gymnastics Center in Southern California.
“USOPC is a beneficiary of the Settlement Election’s release and its injunctions,” according to the filing.
“The only way the USOPC will agree to” the settlement “is if it is protected by the release and injunctions described” in the agreement.
The USOPC reported $193.68 million in revenue in 2019, down from $322.8 million in 2018, the drop largely related to 2018 revenue from the Olympic Games in South Korea that year, according to the organization’s filing with the Internal Revenue Service and financial statement. The organization had $248.3 million in expenses in 2019, down from $275.14 in 2018, leaving the USOPC with a reported $54.6 million shortfall in 2019.
The USOPC spent nearly $26 million in legal related expenses in 2018 and 2019. By comparison the organization paid out $667,300 in legal expenses in 2017. The $8.15 million the USOPC spent on legal in 2019, was roughly $600,000 more than the organization contribution to the operation of the U.S. Center for SafeSport.
Source: Orange County Register