USA Gymnastics, abuse survivors have deal for $380 million in 'full settlement'

More than five years after Rachael Denhollander went public with allegations of sexual abuse by Larry Nassar, the legal battle between survivors and USA Gymnastics is over. 

U.S. Bankruptcy Judge Robyn Moberly said Monday she will approve a $380 million settlement that will compensate more than 500 women abused by Nassar, their coach or someone else affiliated with the sport; give survivors a dedicated seat on the USA Gymnastics board of directors; and end efforts by the U.S. Olympic and Paralympic to strip the federation of its position as the national sports governing body. 

“This chapter is finally closed,” Denhollander said on Twitter. “Now the hard work of reform and rebuilding can begin.

"Whether or not justice comes and change is made, depends on what happens next,” Denhollander added. “I am proud of the nonmonetary reform commitments in particular - this represents so much hard work from members of the committee and I am eager to see these changes through.”

Denhollander's disclosure of her abuse to The Indianapolis Star, part of the USA TODAY Network, in September 2016 set off a firestorm of outrage at USA Gymnastics' and the USOPC's failure to protect young athletes. More than 300 women, including Olympic champions Simone Biles, Aly Raisman and McKayla Maroney, eventually came forward to say they'd been abused by Nassar, often under the guise of medical treatment. 

In a statement, USA Gymnastics president and CEO Li Li Leung apologized to the survivors for "this organization's actions and inactions" and promised to continue working with them.

"Individually and collectively, Survivors have stepped forward with bravery to advocate for enduring change in this sport," said Leung, who was hired in February 2019. "We are committed to working with them, and with the entire gymnastics community, to ensure that we continue to prioritize the safety, health, and wellness of our athletes and community above all else.”

USA Gymnastics and the Survivors Committee had agreed in August on a settlement as part of the federation’s plans to emerge from bankruptcy. But it was not fully funded, with some insurers and the USOPC balking at how much they should contribute.

Under a final agreement reached Sunday, the USOPC will contribute more than $34 million of its own money and its insurers will pay another $73 million-plus, for a total of $108 million. It also will loan USA Gymnastics $6.15 million, interest-free, to help the federation cover its portion of the settlement.

In a statement, USOPC CEO Sarah Hirshland said, "We recognize our role in failing to protect these athletes, and we are sorry for the profound hurt they have endured.  

"Reaching a financial resolution is one extremely important piece of the transformation that is taking place within our organization," Hirshland added. "In addition to actively participating in the mediation and contributing to the settlement, USOPC has enacted sweeping reforms to our governance structure to combat sexual abuse, support athletes and survivors and strengthen protections for athletes against any form of abuse."

USA Gymnastics has undergone a massive leadership overhaul as a result of the abuse scandal, with few of the decision-makers left from five years ago. Hirshland's predecessor, Scott Blackmun, resigned in part because of revelations he had kept quiet about the allegations against Nassar. 

It’s not clear how much each survivor will get from the settlement. No payment details have been released, and USA Gymnastics’ other creditors are also covered by the settlement.

But it is the resolution of lawsuits by more than 500 abuse survivors that is most critical.

“It’s important that everybody understand these funds are not just a payday, not just a windfall. These victims have had tremendous needs and will have tremendous needs going forward,” one attorney for the survivors said during the hearing in Indianapolis.

“The funding provided by this plan will help these folks.”

For many of the survivors, USA Gymnastics’ promises of reforms were as important as the monetary settlements.

Going forward, at least one seat on the USA Gymnastics board will be held by a survivor. A survivor will also be on the federation’s health and safety and Safe Sport committees.

USA Gymnastics will also require local clubs, as a condition of their membership, to put up posters with information on how to report sexual abuse; acknowledge that they understand and will follow their reporting responsibilities when abuse is suspected; and have anyone who is in regular contact with or has authority over minors complete Safe Sport training. 

Every club also would be required to have a "Safety Champion," who would inform USA Gymnastics of the club's compliance with the rules.

"For years we have been demanding change from these organizations that failed us, and the institutional reforms that are part of this settlement will help ensure this abuse does not happen to young athletes in the future," said Tasha Schwikert Moser, a 2000 Olympian and co-chair of the Survivors Committee. 

But Jonathan Little, who represents some of the survivors, took a dimmer view of the prospect of long-term change.

"As long as athletes do not have any economic bargaining power, the system remains the same," Little said. "Athletes need a real union, like Major League Baseball. If athletes had seat at table when (the USOPC and federations) were negotiating all these contracts and sponsorships and such, things would change.

"But that will never happen."

While the settlement ends the survivors' lawsuits against USA Gymnastics, it does not end legal issues related to the case. 

The Department of Justice said in October it is reconsidering the decision not to prosecute former FBI agents who waited nearly a year to pursue early allegations against Nassar. At least 40 women and girls are believed to have been abused in the 17 months between when USA Gymnastics reported Nassar to the FBI in July 2015 and his December 2016 arrest.

Nassar is serving an effective life sentence after pleading guilty to federal child pornography charges and state sexual abuse charges.