USA Gymnastics filed for bankruptcy today to save itself from imploding. The organization has been under massive scrutiny following the conviction of former team physician Larry Nassar for sexual assault. Since Nassar’s conviction, more than 100 lawsuits have been filed that represent 350 athletes. Additionally, the U.S. Olympic Committee request in November that USA Gymnastics no longer oversee the Olympic program.
According to a report by the Associated Press, USA Gymnastics filed for chapter 11 bankruptcy in Indianapolis. The organization hopes the filing will stop the decertification by USOC.
Kathryn Carlson, the newly appointed board of directors, said that the filing would not affect any money available to victims of Nassar. Carlson stated an insurance policy purchased by the group would cover any settlements due to victims.
Carlson emphasized to the AP that the bankruptcy is not liquidation but for reorganization purposes.
The primary reason for the bankruptcy filing is related to action taken on November 5th by USOG. On that date, USOG started the process of removing USA Gymnastics as the governing body for the sport. The AP report stated:
“In an open letter to the gymnastics community, USOC CEO Sarah Hirshland said “you deserve better,” and that the challenges facing USA Gymnastics were more than it was capable of overcoming as currently constructed.”
Carlson believes that filing bankruptcy will force the USOC to put their complaint on hold. USA Gymnastics does not want to go down without a fight. Carlson thinks they can work with USOC to resolve the issues that have plagued the program.
However, a spokesman of the USOC completely disagrees with Carlson and USA Gymnastics. In a statement to the AP, spokesman Patrick Sandusky said,
“While we fully understand that USAG believes this restructuring will begin to solve deficiencies we’ve identified, the filing does not impact our Section 8 complaint and that process will move forward,” Sandusky said.
The decertification of USA Gymnastics by the USOC would enable the group to attempt to move forward following the horrific abuse that went on under USA Gymnastics authority.
Nassar molested more than 300 athletes during his time as team physician for USA Gymnastics. Michigan State University also took a massive hit financially by agreeing to pay $500 million to 332 victims assaulted by Nassar. The sexual abuse by Nassar is the worst sex-abuse case in sports history.
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