LOS ANGELES (CBSLA/AP) – USA Gymnastics is turning to bankruptcy in an effort to ensure its survival.
The embattled organization filed a Chapter 11 bankruptcy petition on Wednesday as it attempts to reach settlements in the dozens of sex-abuse lawsuits it faces and to forestall its potential demise at the hands of the U.S. Olympic Committee.READ MORE: Orange County Deputies Open Fire Inside Foothill Ranch Walmart, Suspect Wounded
USA Gymnastics filed the petition in Indianapolis, where it is based. It faces 100 lawsuits representing 350 athletes in various courts across the country who blame the group for failing to supervise Larry Nassar, a team doctor accused of molesting them.
Kathryn Carson, who was recently elected chairwoman of the board of directors, said the organization is turning to bankruptcy to speed things up after mediation attempts failed to gain traction.
She says: “This is not a liquidation. This is a reorganization.”READ MORE: Amazon To Open First Ever Brick-And-Mortar Clothing Store In Glendale
Carson says the legal maneuvering delays the USOC’s efforts to strip its designation as a national governing body.
But Irvine attorney John Manley, who represented Nassar victim Rachael Denhollander, released a statement alleging the move was made by USA Gymnastics to hinder any investigation into additional abuse allegations.
“This bankruptcy filing will suspend all lawsuits by Nassar survivors and their ongoing efforts to discover the truth about who at USA Gymnastics and the US Olympic Committee knew about Nassar’s criminal conduct and failed to stop it,” said Manley.MORE NEWS: Woman Runs Down, Kills Man With Car In South El Monte, Injures Deputy, Then Leads Pursuit
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