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Penn State's Exposure in Sandusky Case Could Reach $100M or More

Source: Philadelphia Inquirer

Posted on 17 Jul 2012 by Neilson

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Penn State Sandusky CaseAfter the shocking details of Jerry Sandusky's child sexual abuse, after the meticulously documented cover-up by university leaders of his crimes, could Pennsylvania State University's legal exposure get any worse?

Yes, legal experts say, it could. Much worse.

Even before release of investigative counsel Louis Freeh's report Thursday detailing Sandusky's predations and administrators' efforts to hide them, the university faced an avalanche of lawsuits from the former assistant football coach's victims.

But, given the cover-up's duration -- 14 years -- and the multiple acts of sexual abuse Freeh detailed, plaintiffs' lawyers say the university's exposure now could reach $100 million or more. And that does not include the money Penn State will spend for its own legal defense -- or the additional damage to the university's reputation.

"This is a lot worse than what I anticipated," said Andrew Stoltmann, a Chicago-based securities litigator. "The risks for Penn State in going through discovery and leaving a decision in the hands of a jury could be cataclysmic."

As they overcome their reluctance to go public, new victims are almost sure to come forward with new allegations in new lawsuits. Plaintiffs' lawyers will subpoena university records and place senior officials under oath, disclosing each damaging detail in a form of litigation water torture. Such tactics are typically used to pressure defendants and leverage more favorable settlements.

As soon as Sandusky was convicted in June, Penn State offered to begin settlement talks with victims. But prominent plaintiffs' lawyers say there is little likelihood that the university will avoid further litigation or damaging disclosures likely to emerge from that process.

"I don't see in the long run any viable defense of Penn State, and it will be very interesting to see what they knew and when they knew it," said Steven Wigrizer, a lawyer with the Center City firm of Wapner Newman Wigrizer Brecher & Miller. "I can't imagine not wanting discovery" -- the request for more evidence.

Plaintiffs' lawyers say the Sandusky case, though limited to one abuser, bears striking parallels to the litigation that followed disclosures Catholic priests in parishes across the country had sexually molested children.
In both instances, there were allegations that the abuse had occurred over many years and that senior officials had covered it up.

And in the case of the Roman Catholic Church, the payouts have been huge. In Los Angeles, church officials in 2007 settled allegations by about 500 abuse victims for $660 million. Total payouts by the church already have exceeded $1 billion.

"It's just another case in which men who were in power took no steps to protect children but took all the necessary steps to protect the institution," said lawyer Marci Hamilton, who is representing a client who says Sandusky abused him. "They exhibited depraved indifference to the welfare of children."

Jeff Anderson, one of the nation's best-known lawyers litigating child sex abuse cases against the Catholic church, is working with Hamilton in the lawsuit against Penn State. Anderson described the Freeh report as a mere starting point for further investigation. He employs former police and FBI agents to gather evidence for his lawsuits, and he said he expected to find more cases of abuse by Sandusky.

"It gives us a baseline to work with where we can explore some of these issues in greater depth," Anderson said.

The report paints in excruciating detail a picture of senior university officials looking for ways to keep a lid on the scandal. Their failure to act on behalf of the victims, Freeh said, caused other children to be abused.

In one compelling example, the report details a May 4, 1998, complaint to campus police by the mother of a young boy who said Sandusky had invited her son to work out with him in university locker room. The coach allegedly showered with the boy and touched him inappropriately. The boy later told police that Sandusky said, "I love you."

Penn State campus police were so concerned they were dealing with a child molester that they covertly listened in on a conversation between Sandusky and the boy's mother after the incident. During that visit, according to police reports, Sandusky seems to have been close to admitting wrongdoing.

"I was wrong," police quoted him as saying to the boy's mother. "I wish I could get forgiveness. I know I won't get it from you. I wish I were dead."

Four senior university officials, former university president Graham B. Spanier, former senior vice president for finance and business Gary C. Schultz, former athletic director Timothy Curley and former head football coach Joe Paterno, were apprised of the incident as well as of details of the investigation.

Yet they took no action to restrict Sandusky's access to campus facilities. Nor did they do anything to protect children who might visit the campus with him. Nor did they report the incident to university trustees. They did not even bother to talk to Sandusky.

"The biggest problem for Penn State is the length of time in terms of knowledge that people and higher-ups at Penn State had with respect to Jerry Sandusky," said Stoltmann, who estimated the university's liability at $100 million. "If there was knowledge about Sandusky for a year or two, that would be one thing. It's another thing if the conduct has taken place for longer than a decade. Jurors tend to get outraged the longer things like this go on."

Several legal experts said Penn State will not be entirely without defenses. Some people alleging they were abused may lack sufficient evidence. The university might also try to argue in some cases that the abuse occurred after Sandusky had retired and was no longer a university employee.

Yet the outrage is so intense that even in instances where evidence is lacking or the basis for a claim might be weak, the university will be on the defensive.

"With an injustice of this magnitude, there will be a remedy," Wigrizer said.