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USA Gymnastics files for bankruptcy

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USA Gymnastics is turning to bankruptcy in an attempt to ensure its survival.

The embattled organization filed a Chapter 11 bankruptcy petition on Wednesday in an effort to reach settlements in the dozens of sex-abuse lawsuits it faces and to avoid 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 over 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. Nassar, 55, worked at USA Gymnastics and Michigan State University for decades. He is serving effective life sentences for child porn possession and molesting young women and girls under the guise of medical treatment.

Kathryn Carson, the recently elected chairwoman of USA Gymnastics’ board of directors, said the organization’s goal is to speed things up after mediation attempts failed to gain traction.

“Those discussions were not moving at any pace,” Carson said. “We as a board felt this was a critical imperative and decided to take this action.”

The filing does not affect the amount of money available to victims, which would come from previously purchased insurance coverage, she said. Carson said the insurance companies “are aware we’re taking this action and our expectation is they will come to the table and pay on our coverage.”

Carson added: “This is not a liquidation. This is a reorganization.”

John Manly, an attorney representing dozens of women who have pending lawsuits against USA Gymnastics, chastised the organization for continuing to “inflict unimaginable pain on survivors” and encouraged law enforcement officials to “redouble” their investigative efforts.

“Today’s bankruptcy filing by USA Gymnastics was the inevitable result of the inability of this organization to meet its core responsibility of protecting its athlete members from abuse,” Manly said in a statement. “The leadership of USA Gymnastics has proven itself to be both morally and financially bankrupt.”

USA Gymnastics insists that’s not the case, stressing that the filing is based on legal expediency, not fiscal distress.

While Carson acknowledged that sponsorship is down since the first women came forward against Nassar in the fall of 2016, she described the financial condition of USA Gymnastics as “stable.”

USA Gymnastics reported assets in a range of $50 million to $100 million and a similar range of liabilities, with 1,000 to 5,000 creditors. The organization said its largest unsecured creditor is former president and CEO Steve Penny, who is owed $339,999.96. USA Gymnastics is disputing Penny’s claim, though attorney Cathy Steege declined to get into the specific nature of the dispute.

Penny resigned under pressure from the USOC in March 2017. Two other presidents — Kerry Perry and former U.S. Rep. Mary Bono — have followed in what has become a revolving door amid the organization’s hierarchy.

It’s that chaos at the top that led the USOC to initiate the process of removing USA Gymnastics as the sport’s national governing body at the Olympic level — a step that’s taken only under the most extreme circumstances.

In an open letter to the gymnastics community in November, 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.

Carson said the legal maneuvering Wednesday delays the USOC’s efforts to strip its designation as a national governing body.

“We always have a dialogue going with them and intend to make it clear with them we have a lot to talk about and we want to keep that going,” she said.

USOC spokesman Patrick Sandusky said the committee is reviewing the filing’s potential effect on decertification. “Financial stability and viability are essential for a national governing body to operate in the best interests of the athletes,” Sandusky said.

USA Gymnastics believes bankruptcy protects it from having opportunities or assets taken away by a debtor. Carson acknowledged that being a national governing body “is a big part of how we raise our revenue.”

Carson, who replaced Karen Golz as chairwoman last week, said she accepted the position because she believes in the direction of USA Gymnastics, which she said doesn’t need money but rather time.

“We think we’re changing the dynamic and we certainly believe that we will try to remain the NGB,” Carson said. “To be clear, it is our lawyers’ firm belief that the bankruptcy will automatically stay (decertification) … and we will work with the USOC to regain credibility.”

Nicholas Georgakopoulos, a bankruptcy expert and law professor at the Indiana University’s Indianapolis campus, said USA Gymnastics is “hoping for a miracle” with its legal maneuvering.

“The USOC says you violated this relationship, here are the consequences and USA Gymnastics is saying it filed for bankruptcy, there are no consequences,” Georgakopoulos said. “This is like a gambling addict who goes to the casino and gambles every day and one day the casino says you can’t come anymore, you’ve lost too much, and addict says, I filed for bankruptcy, you can’t stop me from coming to the casino.”

If the USOC wants to go forward with decertification, it must now go to court.

USA Gymnastics has no timetable on how long the bankruptcy process will take and did not offer a ballpark on how much it expects to pay in settlements. Its doors, however, remain open for business.

“We are continuing to pursue all aspects of our current operating model,” Carson said. “This affords us an opportunity to reorganize as well as resolve the claims with the survivors.”

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David Boudia adjusts diving event, goal for world championships

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David Boudia earned diving medals at his last three world championships and the 2012 and 2016 Olympics, but that was on the platform. He competes on the global stage on the springboard for the first time at worlds this week.

“I don’t have a lot of high hopes,” Boudia, who is still learning the springboard after switching to it in the last year, said in a phone interview from South Korea, where he begins competition Wednesday (TV schedule here). “But I think my biggest goal is to walk away with an Olympic spot.”

An Olympic spot not necessarily for himself, but for the U.S.

Boudia, a 30-year-old father of three, and any other American will clinch 2020 Olympic quota spots by placing in the top 12 in their respective individual events this week. Those spots, and any others earned at later competitions in the next year, will be filled at trials in June in Indianapolis.

NBC Sports analyst Cynthia Potter believes Boudia, who left the sport to sell homes in 2017 and came back and suffered a concussion off the platform in 2018, can meet his goal of making Friday’s 12-man final in Gwangju.

“He would have to dive well, but not better than he’s been diving,” she said. “His springboard is really well-timed, rhythmic, and he’s for a long time known how to go into the water without making a splash.”

But challenging Rio Olympic gold and silver medalists Cao Yuan of China and Jack Laugher of Great Britain, plus defending world champion Xie Siyi of China would be very tough.

Boudia lacks their degrees of difficulty, for now. He hopes to switch out two of his six dives before his first competition of 2020, though he could insert one of them should he make the world final.

“I need a good six months, so from August to December is when we’re kind of really drilling the fundamentals of learning those new dives and getting them perfected,” he said.

Boudia rallied to beat Rio Olympic springboard diver Michael Hixon for the title in May at nationals, where the top two per event earned world berths. But Boudia competed there with about a month of competition dive practice, about half as long as he would prefer.

“Hix and I are going to have a lot of training to do if we want to be even close to cracking that top five,” at worlds, Boudia said in May, according to TeamUSA.org.

Boudia is the lone U.S. diver to earn an individual world medal in an Olympic diving event since 2009.

The U.S. produced breakthroughs at worlds so far. Sarah Bacon became the first American woman to earn a world title since 2005, taking the non-Olympic 1m springboard event. Murphy Bromberg and Katrina Young bagged bronze in synchronized platform, ending a decade-long medal drought in any synchro event.

But Boudia’s goal must be shared among the whole team — as many top-12 finishes individually and top three in synchro events to gobble up Tokyo 2020 quota spots. The U.S. failed to qualify full teams for the 2012 and 2016 Olympics.

“Getting in the top 12 in the four individual Olympic events is the big deal right now,” Potter said. “Whether you are on the awards stand or not, that would be icing on the cake for a lot of these divers.”

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Anita Wlodarczyk, one of track and field’s most dominant, sidelined

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Poland hammer thrower Anita Wlodarczyk, the only woman to win the last five combined Olympic and world titles in a track and field event, will not go for a fourth straight world championship this fall.

Wlodarczyk had season-ending, arthroscopic left knee surgery on Monday, according to Polish media citing her coach.

Wlodarczyk, 33, has the top 15 throws on the IAAF’s all-time list, and 27 of the top 29. Her world record of 82.98 meters (scribbled on her leg pre-op) is 11 and a half feet farther the second-best woman in history. She originally took silver at the 2012 Olympics and 2013 Worlds but was upgraded to gold after Russian Tatyana Lysenko was stripped for doping.

Wlodarczyk won a reported 42 straight finals between 2014 and 2017, then suffered three losses in 2018 and two so far this year in three lower-level meets before the operation.

Americans DeAnna Price and Brooke Anderson rank Nos. 1 and 2 in the world this year. A U.S. woman has never finished in the top five of an Olympic or world championships hammer throw, which debuted at worlds in 1999 and the Olympics in 2000.

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