In November, the U.S. Olympic Committee decided to start proceedings to strip USAG of its governing-body status. The move was drastic, if unsurprising: It would leave the 200,000 gymnasts, coaches, clubs and judges who operate under its banner with no viable alternative entity to administer or sponsor the vast majority of competitions in the United States, whether low-level or elite. (Smaller, less-competitive leagues lack the infrastructure to do this.) But the organization does not plan to relinquish its status anytime soon. Last week, before reactions could really take hold — Hooray! Wait, what’s going to happen at the 2020 Olympics? What about my niece in Level 9? — USAG filed for Chapter 11 bankruptcy protection.
On the surface, this may seem like the death knell of an irredeemably diseased entity. In actuality, it is the opposite: a shrewd and deeply cynical restructuring move that would allow the USAG to retain power. The organization will neither liquidate nor cease operations. Instead, the bankruptcy claim just happens to halt its decertification by the Olympic Committee and — even more crucially — stays all pending litigation: a staggering 100 lawsuits by 350 plaintiffs, calling for an estimated $150 million in damages.
These plaintiffs are all victims of the central figure in nearly every aforementioned controversy: former national team physician Larry Nassar, who in January was found guilty of multiple sex crimes — which he committed for decades under the guise of medical treatment — and sentenced to 40 to 175 years in prison. The suits, whose plaintiffs include Olympians Kyla Ross, Aly Raisman, Jordyn Wieber and McKayla Maroney, argue that USAG failed to protect gymnasts from Nassar’s abuse despite being informed of his behavior for years.
USAG claims that the bankruptcy filing will hasten its ability to compensate Nassar’s survivors with insurance. It has been insolvent in the wake of a mass sponsor exodus in 2017 (not to mention Penny’s reported $1 million severance package, which I suppose he needed for bail). “We owe it to the survivors to resolve, fully and finally, claims based on the horrific acts of the past,” Kathryn Carson, president of USAG’s board of directors, explained in a Dec. 5 statement to the media.
These words reek of the smarmy doublespeak of a corporate entity again failing to account for the full human cost of its actions — actions that, thanks to the bankruptcy filing, will come to light much more slowly, if at all. The Chapter 11 claim not only halts all pending litigation; it also halts the discovery process that might uncover the extent of USAG’s complicity in Nassar’s behavior.
USAG — far too recently the subject of gauzy, hagiographic NBC fluff pieces — is credited with bringing the American women’s squad from its status in the Soviet days as terminal off-podium finishers to an era of truly awe-inspiring dominance (the U.S. women won the 2016 Olympic team gold by almost 10 full points). As Dvora Meyers has written in her seminal history of gymnastics scoring, “The End of the Perfect 10,” that era coincided with the refinement of Bela and Martha Karolyi’s “semi-centralized” method. Each national team member and her coach were summoned to a national training camp at the Karolyis’ Texas training center, known as “the Ranch,” once a month. Essentially, it was the closest American culture would allow to the old Eastern Bloc system of plucking promising gymnasts away from their families and spiriting them to a national facility from the age of 3.
Under that regime, the U.S. women’s team won 28 Olympic medals between 2004 and 2016, and a culture of abuse took hold, Meyers writes. As USAG looked on (and counted championships), Martha Karolyi reportedly ignored injuries, encouraged undereating and deprived athletes of adequate contact with their families. It was also the ideal environment for a predator such as Nassar, who became national team physician in 1996, two years after his first accusation of sexual assault was ignored. He continued his abuse for two decades, uninterrupted and unimpeded — most notably at the camps, where he cultivated a warm “buddy” and “confidant” reputation — sneaking the gymnasts treats, for example, to groom, confuse and silence these young women.
The sport’s governing body not only failed to report Nassar to law enforcement but — as an October lawsuit by 2000 Olympian Tasha Schwikert says — initially responded to the eventual 2014 investigation of Nassar in a manner as botched and unprofessional as it was disingenuous, and in some instances criminal. Schwikert claims that Penny asked her to vouch for USAG and even had her sign a predrafted statement that said, “I firmly believe USA Gymnastics always had my health and well-being top of mind.” The evidence-tampering charges against Penny — that he sought to have damning documents removed from the Karolyis’ facility — also point to an active coverup.
As much the plaintiffs deserve financial compensation, a simple payoff does not constitute a “full and final” resolution. The survivors are also owed due process. They are owed a legal decision that codifies and affirms the truth of what happened: Obsessed with the mounting medal count, the organization that was supposed to be their voice dismissed the mounting evidence against the predator in their midst and then tried to hide its role in this stomach-churning behavior.
Still, USAG has a chance to make it right. If the Chapter 11 process is completed swiftly — without a concerted effort to pay off the survivors with settlements as part of the bankruptcy proceedings — then the litigations, including the crucial discovery process, can resume. Then the organization can finally bear responsibility, in a court of law, for the woeful dereliction of its most important duty: to act as protector and advocate for the hundreds of thousands of young athletes made vulnerable by the very system it created. Then, and only then, will USA Gymnastics even begin to rebuild itself from the only kind of bankruptcy that really matters.