Thanks for the summary. This point is an interesting one:
"Curley & Shultz did a poor jobs with this. Even a soft report warranted better documentation. It's ridiculous to not remember if something was reported to CYS."
Of course, the question that is asked is whether there was intent in any perceived failings. Curley and Schultz did not break the law and did not endanger a child, but did they do everything they should have? Perhaps not, but I do not believe there was any malicious intent.
Part of the issue with how Curley and Schultz responded likely was there being so many cooks in the kitchen. There need to be many involved, but that adds complexity. What does courtney think? What does raykovitz say? What does Graham, our boss, want us to do? Assuming they involved harmon, what did he say or do?
Another issue, frankly, is that ignorance was likely at play. First, you're told it was horseplay. It wasn't clearly illegal, but it may have been odd. Second, how much if any training had Curley or Schultz received in these matters by 2001? Regardless, they still consulted with legal counsel and raykovitz.
Related to the cooks in the kitchen and ignorance, there also may have been a bit of buck-passing, hot potato. Curley and Schultz likely found themselves well outside their comfort zone. They were getting opinions from people outside the university. Who should now do what, when, and how? Furthermore, the fact that it was sandusky probably made it that much harder to take a hard line. That is not to say in any way that anyone wanted to cover it up, but the fact that they knew sandusky and that he was so highly revered in 2001 had to make taking a hard line difficult.
It is easy years later to armchair quarterback the situation, but I think Curley and Schultz found themselves in uncharted waters and a difficult situation.