In an interview with CBS's "Meet the Nation," President of Penn State University, Rodney Erickson said the university is adequately prepared financially to resolve the various lawsuits it faces (or will face) in light of the former football coach Jerry Sandusky's child sex-abuse scandal and the consequential cover-up revealed in the recently released Freeh Reports.
The university faces $60 million in fines imposed by the National Collegiate Athletic Association (NCAA) for the Sandusky cover-up, $10 million in investigative and public relations expenses and of course millions in settlements with victims. Reports show that in 2011, the University made approximately $1.4 billion from tuition, which is the institution's main source of income.
And although Erickson assured CBS' Bob Schieffer that "like any University our size, we believe we are adequately prepared," However, there are reports that suggest the contrary. There are reports that suggest the university will struggle to produce the money.
The institution's insurers Pennsylvania Manufacturer's Association Insurance co- the Blue Bell Company has refused to pay general liabilities. The company filed a plea in January that its general-liability, directors & officers policies will not cover any liabilities caused under the Sandusky scandal or related matters.
According to Boston Herald, the university can neither claim sovereign immunity because it "does not typically protect even publicly supported schools from serious liability claims," according to Bostonherald.com
According to a statement released by the university, no philanthropic funds will be used to make payments involved with the scandal. As the nation waits to see what is to become of the university in the next chapter of this disastrous blow, it remains to be seen if Erickon's claims hold true.
In May, Jerry Sandusky was convicted on 45 counts of child sex-abuse and molestation during his reign as assistant football coach at PSU. The 68 year-old, is currently in Centre County prison awaiting his sentencing. He could face a maximum sentence of 373 years. Recently, former FBI director Louis Freeh released a report that implicated top university officials in a meticulous cover-up of the various allegations against Sandusky. The officials implicated included among others the much revered coach Joe Paterno.
