Penn State settles civil claims with Sandusky victims for $59.7 million

By Jon Campisi | Oct 28, 2013

Twenty-six victims of Jerry Sandusky, the former Penn State assistant

football coach jailed for three-to-six decades for child molestation, have agreed to settle civil claims with the central Pennsylvania university for nearly $60 million, the school announced on Monday.

Penn State officials confirmed this week that 23 of the 26 settlement agreements are fully signed, while three have been agreed to in principle.

The $59.7 million in settlements are subject to confidentiality agreements.

“The Board of Trustees has had as one of its primary objectives to reach settlements in a way that is fair and respects the privacy of the individuals involved,” Keith Masser, board chairman, said in a statement released by the university. “This is another important milestone in accomplishing that goal.”

Penn State officials said that the settlement amounts will not be funded by student tuition, taxpayer money or university donations.

The dollars are expected to come out of the school’s liability insurance policies, and expenses not covered by insurance are expected to be funded from interest revenues related to loans made by the university to its self-supporting units, the school announced on its website.

“We hope this is another step forward in the healing process for those hurt by Mr. Sandusky, and another step forward for Penn State,” University President Rodney Erickson said in a statement. “We cannot undo what has been done, but we can and must do everything possible to learn from this and ensure it never happens against at Penn State.”

Sandusky was convicted in June 2012 on 45 counts of child sex-abuse and subsequently sentenced to 30-to-60 years in state prison.

A Pennsylvania appeals court recently upheld the conviction and sentence.

In his statement, Erickson thanked attorneys Kenneth Feinberg and Michael Rozen for their efforts in helping to facilitate the settlements.

“Their expertise and efforts have been invaluable to our ability to reach mutually acceptable resolutions in the large majority of the claims,” Erickson stated.

The university had retained the lawyers’ services to help with settlement negotiations.

Penn State says it had received claims from a total of 32 people who either were, or allege they were, victimized by Sandusky.

The school ended up rejecting six of those claims as being without merit and has engaged individuals in possible settlement discussions, the university announced.

In his statement, Erickson noted that Penn State during the past year has instituted more than 115 changes relating to safety, security, compliance, governance and human resources.

Many of the changes were inspired by the Sandusky child molestation scandal.

“Through self-imposed urgency, the Board of Trustees, administration and staff have brought sweeping reform and best practice processes to nearly every aspect of the University’s governance and oversight,” the school’s statement reads.

Erickson said Penn State has made great strides, but that more still needs to be done.

“Our University is a better institution today as a result of the work and dedication of our trustees, administrators, faculty, staff and students,” the president stated.

The child sex-abuse scandal spurred litigation against not only Penn State, but also various former officials, such as since-fired president Graham Spanier, former athletic director Timothy Curley and former Vice President Gary Schultz.

Those three individuals were hit with perjury and failure-to-report charges following the scandal.

Spanier has filed court papers indicating he, too, plans to sue; the defendant in the pending Spanier action is Louis Freeh, the former FBI director and federal judge who was retained by Penn State to conduct an internal investigation into the school’s knowledge of the events surrounding the Sandusky matter.

A lawyer representing Spanier in his pending civil suit recently filed a motion to have the case stayed pending the resolution of the criminal matter.

The lawyer, Elizabeth Ainslie, of the Philadelphia firm Schnader Harrison Segal & Lewis, wrote that the civil and criminal cases are predicated on the same allegations, and allowing the lawsuit to go forward at this time could prejudice her client.

Meanwhile, a lawsuit filed by the family of Joe Paterno, the late Penn State head football coach, against the NCAA challenging the sanctions on the university that arose from the sex scandal is progressing in federal court.

And another civil case is also making its way through the courts, this one by former assistant football coach Michael McQueary against Penn State.

The McQueary suit, which contains counts of whistleblower law violations and defamation, is playing out in state court.

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