The cache of court documents related to the Penn State abuse scandal that were unsealed today came from the university’s legal dispute with its insurance company, PMA, which argued that it was not responsible for covering the university’s payments to Jerry Sandusky’s victims, in part because Penn State officials knowingly kept the abuse secret. One of the documents that was unsealed is a letter from PMA to the university, in which the insurance company lays out how much it believed some of Sandusky’s victims should have been paid.
The letter was sent by PMA’s attorney, Paul Gagne, to an attorney representing Penn State on February 27, 2013. It includes a list of redacted victims alongside dollar amounts that PMA determined would be appropriate payouts:
It is unclear how precisely the insurance company appraised the suffering of each victim so that these dollar amounts could be assigned. In a separate letter, an attorney hired by PMA to review Penn State’s settlement payments deemed the amount the university paid to the victims to be “high and in some cases extremely high.” The attorney posits that the university paid more than it needed to because of “a concern about publicity and a desire to resolve the matters very quickly.”
We don’t know how much the redacted victims in the excerpt referenced above were ultimately paid, nor do we know the grand total of Penn State’s payments to Sandusky’s victims. The unsealed documents do reveal that one victim agreed to a $250,000 settlement, one was paid $1.25 million, and another settled for $5.5 million. A lawyer representing one victim told The New York Times that the university has paid out a total of $92.8 million in settlements.
The judge presiding over the dispute between Penn State and PMA ruled that the insurance company is not responsible for claims stemming from incidents of abuse that took place between 1992 and 1999, a period in which Sandusky preyed on many of his victims. The ruling could leave the university without tens of millions of dollars it planned on recouping for settlement amounts that have already been paid out.