USAG files bankruptcy

USA Gymnastics is turning to bankruptcy in an effort to ensure its survival. The 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. 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 chairman of the board of directors, said the organization is turning to bankruptcy to speed things up after mediation attempts failed to gain traction. The filing does not affect the amount of money available to victims, which would come from previously purchased insurance coverage, she said. “This is not a liquidation. This is a reorganization,” Carson said, one that USA Gymnastics hopes will buy it enough time to fend off the USOC’s intent to decertify it. The USOC on Nov. 5 took steps to remove USA Gymnastics as the sport’s governing body at the Olympic level — a step that is taken only under the most extreme circumstances. Carson said the legal maneuvering Wednesday delays the USOC’s efforts to strip its designation as a national governing body. USOC spokesman Patrick Sandusky disagreed. “The filing does not impact our Section 8 complaint and that process will move forward,” Sandusky said.