Gallup Diocese, Abuse Victims to Begin Mediation - Bankruptcy Beat - WSJ

 

A bankruptcy judge has ordered the Roman Catholic Diocese of Gallup, N.M., its insurance carriers and lawyers representing 58 alleged sexual-abuse victims to begin mediation no later than July 15.

Judge David Thuma, who oversees the diocese’s bankruptcy proceedings, signed off on mediation at the request of both alleged victims and the diocese, which stretches across broad swaths of northern Arizona and New Mexico.

Mediation is likely the best opportunity to resolve the diocese’s bankruptcy case through a settlement that provides compensation to alleged victims and protects the church from future litigation, according to lawyers involved in the case. Other diocesan bankruptcies prompted by sexual-abuse claims have stretched out over years, racking up huge legal bills.

In advance of mediation, lawyers representing the diocese, insurers and alleged victims have spent nearly a year and a half seeking out victims, assessing the value of the diocese’s assets and collecting evidence on the allegations of abuse and alleged cover-up by diocesan officials, much of which is said to have taken place decades ago.

Susan Boswell, a lawyer for the Diocese of Gallup, said she hopes to arrive at a court-approved settlement with alleged victims and others well in advance of the second anniversary of the case in November.

“We need to get this case done,” she said at a hearing last week.

James Stang, a lawyer with Pachulski Stang Ziehl & Jones LLP who has represented thousands of victims in nearly a dozen diocesan bankruptcies, told the judge he doesn’t want to receive news of another victim’s death before the case is resolved.

“I know that may seem a little melodramatic,” he said at the hearing.  “But it happens to me on a regular basis.”

But not everyone involved in the case is eager to begin mediation.

Catholic Mutual Group, the Diocese of Gallup’s insurance carrier, said it wanted more time to collect and evaluate information on abuse claims and accused the diocese of failing to hand over files on abusive priests.

In court papers, Catholic Mutual said the diocese has placed “every conceivable roadblock in the path of Catholic Mutual’s request for information.”

David Spector, a lawyer for Catholic Mutual, said that the dispute with the Diocese of Gallup was highly unusual and that Catholic Mutual had never before had an adversarial relationship with a diocese. Catholic Mutual is the primary provider of insurance coverage to many Catholic dioceses in the U.S. and Canada, and its board of trustees consists of 25 Catholic bishops, archbishops and cardinals.

“We don’t want to go to war with the diocese,” Mr. Spector said. “All we want is some basic information to enable us to be able resolve these claims.”

Ms. Boswell disputed Catholic Mutual’s assertions, calling them an “incomplete story.”

“Unfortunately, Catholic Mutual responds to each group of documents it receives, with a request for more information and documents, failing to realize the limited resources of the diocese,” she said.

A Franciscan order of priests, several parishes and a Catholic school will also participate in the upcoming mediation along with the diocese, victims and insurance carriers. Several other Catholic institutions, which could eventually be pulled into the diocese’s bankruptcy case, were not ordered to attend.

Lawyers for alleged victims say they are continuing to investigate other dioceses and religious orders that may have played a role in protecting abusive priests at the Diocese of Gallup.

One such diocese, the Diocese of Corpus Christi, Texas, failed to adequately warn the Diocese of Gallup about an abusive priest who was ordained in Corpus Christi but later moved to Gallup, victims’ lawyers say.

“Any accusation of inappropriate conduct, made against a church worker or employee of the Diocese is always taken seriously and fully investigated regardless of the age of the victim or the amount of time that has passed,” a spokesman for the Diocese of Corpus Christi said in an email.

The Diocese of Gallup, home to 58,000 parishioners, filed for chapter 11 bankruptcy protection on Nov. 12, 2013, as several lawsuits related to sexual-abuse claims were preparing to go to trial.

Judge Randall Newsome, who formerly served as the chief judge of the U.S. Bankruptcy Court for the Northern District of California, will serve as the bankruptcy court-appointed mediator and will work pro bono.

Judge Newsome led a similar round of mediation in 2012 between several hundred abuse alleged victims and the Archdiocese of Milwaukee, which failed to produce a settlement.

In total, 14 Catholic dioceses and religious orders have turned to chapter 11 in the past decade to address waves of litigation related to alleged sexual abuse of children.

Write to Tom Corrigan at tom.corrigan@wsj.com. Follow him on Twitter at @TheTomCorrigan

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Gallup Diocese, Abuse Victims to Begin Mediation - Bankruptcy Beat - WSJ

Archdiocese bankruptcy will include search for assets | Minnesota Public Radio News

 

The Archdiocese of St. Paul and Minneapolis chancery building sits near the foot of the Cathedral of St. Paul, overlooking downtown St. Paul. Jeffrey Thompson | MPR News

The bankruptcy of the Archdiocese of St. Paul and Minneapolis takes another step forward Tuesday afternoon with the first meeting of the creditors committee.

Citing clergy-abuse lawsuits and the costs of future claims, the archdiocese filed for bankruptcy in January. Its Chapter 11 filing requires alleged victims to file claims in federal court as creditors.

• Archbishop: Bankruptcy best path for clergy sex abuse claims

Explore the full investigation Clergy abuse, cover-up and crisis in the Twin Cities Catholic church

So far, five people — all alleged victims of clergy sex abuse — have been named to the committee. Payouts to them and other creditors will depend greatly on what assets the archdiocese has available for compensation — a factor that likely will set in motion a detailed search for church assets.

The archdiocese and attorneys for abuse victims hope that insurance will cover a large portion of abuse claims that will be settled through the bankruptcy process, with church insurers potentially providing $100 million or more.

• Related: What mediation means for the archdiocese, insurers and victims

Insurers are contesting coverage claims by the archdiocese, with some companies claiming they owe the archdiocese nothing for claims related to abusers whom the church identified but failed to stop.

But in bankruptcies prompted by sex abuse claims, a diocese typically contributes something to a settlement with victims.

A big question is what the Twin Cities archdiocese could offer the 150 or so people with abuse claims.

"The answer is: 'It depends,' " said Christopher Soper, a University of Minnesota law professor and attorney who has been involved in several Catholic Church bankruptcies. He expects close scrutiny of archdiocese accounting and the church's relations with other Catholic organizations.

"It's a pretty common way for creditors of the debtor to try to gin up more assets to spread around," Soper said. "I'm sure all the interested parties will be looking very carefully at the archdiocese finances to see if the various entities are really as separate as they claim."

Toward that end, forensic accountants will dig into the finances of the archdiocese, hunting for anything of significant value that may not have been already disclosed. They'll also peruse pension plans, parishes, schools, cemeteries, charities and other Catholic entities, looking for any money and assets that could be deemed to be property of the archdiocese.

Archbishop John Nienstedt Jeffrey Thompson / MPR News

Archbishop John Nienstedt and other diocese leaders serve on many of the boards of those organizations. The archdiocese insists parishes, schools, cemeteries, charities and other Catholic entities are legally separate and their assets — which could be worth several hundred million to more than $1 billion -- should be beyond the reach of creditors.

But Jennifer Haselberger, a former archdiocese canon lawyer and whistleblower on abuse, argues that many of those assets may still be at risk.

In a recent blog post, she wrote that creditors could make the case that the archdiocese exerts enough control over parishes and other Catholic entities that legal separation effectively does not exist.

While many parishes are in debt or have few or no assets of value to creditors, Haselberger said a fair number of them hold a significant amount of property.

Jennifer Haselberger Jennifer Simonson | MPR News 2013

"St. Katherine Drexel, for instance, has more than thirty undeveloped acres in Ramsey, and Sts. Joachim and Anne about ten acres in Shakopee," she wrote in her blog post. "Other parish corporations hold undeveloped land, commercial real estate, rental housing, etc."

In its bankruptcy filing, the archdiocese reported net assets of only about $30 million. But that includes about $14 million in trust accounts that fund medical and dental health plans.

Larry Ricke, the attorney for the trustees of the archdiocese's medical and dental plans, said that more than 90 percent of the money in the plans comes from Catholic parishes, schools and other organizations and some 3,350 of their employees.

"The funds ... were contributed by participating employers, primarily the parishes and schools, and their individual employees and are to be used solely for the purpose of paying the medical and dental claims of the employees," Ricke wrote in an email.

The archdiocese has about $2 million in funds that it contends have donor restrictions on how the money can be used.

The bankruptcy also likely will cost the archdiocese millions of dollars in legal and other professional fees. That's money that won't go to abuse victims. In just the 90 days before its bankruptcy filing, the archdiocese paid legal and consulting firms about $2 million.

Indeed, the financial state of the archdiocese appears dire when the potential cost of compensating abuse victims is factored in. Archdiocese auditors late last year warned that there was substantial doubt about the chancery's ability to continue as a going concern.

Jack Ruhl, an accounting professor at Western Michigan University who has worked with victims' attorney Jeff Anderson, believes the archdiocese has more assets than it admits.

"I would not conclude that there's not much there," he said. "There's a lot of different pots of money. There are entities like the cemeteries, the pension fund."

There is also property. The archdiocese has reported real estate holdings that it values at least $11 million. The two most attractive properties are the Hayden Center on West Kellogg Boulevard and the chancery on Summit Avenue.

A development on the chancery property could include scores of high-end apartments or a few luxury homes with spectacular views of the river valley. But developer James Stolpestad, chairman of Exeter Group, which has developed many projects in St. Paul, said such projects could be too impractical to provide much value in bankruptcy.

"The biggest issue would be the historic approvals, local, state and federal, because it's a national historic district long Summit," he said.

The Archdiocese of St. Paul and Minneapolis chancery building sits near the foot of the Cathedral of St. Paul, overlooking downtown St. Paul. Jeffrey Thompson | MPR News

Archdiocese real estate holdings also include the Cathedral of St. Paul and land under three Catholic high schools. But church officials doubt those properties have much value.

The cathedral has an estimated market value for tax purposes of about $21 million. But there is a $4.5 million loan on the cathedral and archdiocese officials say the property has very high maintenance costs, substantial deferred maintenance, limited potential and no "realizable value."

It's not unheard of, however, for grand churches or temples to be sold, typically to followers of another faith.

"Churches can be sold like any other property," said Catharine Wells, a Boston College law professor who has followed church bankruptcies across the country. "There certainly isn't in most states any special exemption for church property."

In 2012, The Catholic Diocese of Orange, California bought the Crystal Cathedral that was built for televangelist Robert Schuller, paying nearly $60 million for the church and its 34-acre campus.

The Twin Cities archdiocese estimates the land under the Totino Grace, Benilde-St. Margaret's and DeLaSalle high schools has a combined estimated market value of $13.7 million. But it reported that the value of its interest in the properties is "unknown."

That reflects uncertainty about what value the land could have given its current use and zoning and other restrictions on the properties.

Each school pays $1 a year to lease land from the archdiocese. DeLaSalle President Barry Lieske said he doesn't expect the bankruptcy to affect his school financially.

DeLaSalle High School in Minneapolis. Jennifer Simonson | MPR News

"DeLaSalle is confident that the archdiocese bankruptcy will have no impact on what we do," he said. "We're a separately incorporated nonprofit."

There are more than 200 undeveloped acres of land in Catholic cemeteries in New Hope and Mendota Heights.

According to the archdiocese, the cemeteries are part of a separate legal entity, established in 1969.

Public records indicate the archbishop and two other high ranking archdiocese officials have seats on the cemeteries' boards and they appoint other board members.

John Hedback, the attorney for the cemeteries, said their officials don't see how those properties could be tapped to pay archdiocese creditors.

"We don't believe there's been any action since they were spun off which would give result in it being a source of funds," he said.

But Charles Zech, director of the Center for Church Management and Business Ethics at Villanova University, expects the relationship will be closely examined.

Resurrection Cemetery in Mendota Heights is the largest cemetery in the Archdiocese of St. Paul and Minneapolis. Less than half of the total 350 acres have been developed for current cemetery use. Jeffrey Thompson | MPR News

"That'd be up to the court to decide how separate they are," he said. "But potentially the undeveloped cemetery land could be part of the settlement."

The assets of the cemeteries is unknown, as they do not have to file public financial reports. In the Archdiocese of Milwaukee's bankruptcy, creditors have been trying to access a $60 million cemetery trust fund.

There is a lot of money — probably more than $100 million — in the priest and lay employee pension plans overseen by the archdiocese. The plans cover 401 priests and 5,079 current and former employees of the archdiocese, parishes, schools and other Catholic organizations.

But archdiocese officials say the pensions are not archdiocese property and "our understanding is that the plan assets should not be available to the creditors."

The archdiocese also contends that the plans currently do not have enough money to pay future obligations. As of the end of 2010, internal church documents indicate the plans had about $114 million in assets and were on the hook to pay projected benefits of $183 million.

The current state of the pensions is unclear because they are not subject to the public reporting requirements that most pensions are. But the archdiocese plans to issue a pension funding report next month.

Given the stock market's rise in recent years, the gap between pension assets and obligations likely narrowed. But Zech expects the pensions' funding could be diminished by the bankruptcy. Zech said archdiocese assets that could fund the pensions could be diverted toward a settlement with abuse victims. He said that happened in the Wilmington, Del., church bankruptcy.

"They're certainly in for some financial hit," he said.

As church plans, the pension plans are not subject to federal reporting requirements, nor are they backed by the Pension Benefit Guaranty Corporation.

Overall, Zech said, the archdiocese appears to have done a good job to limit the damage that can be done by big legal settlements. It has largely accomplished that by ensuring that related Catholic entities are set up as separate legal entries, which could put them beyond the reach of archdiocese creditors.

Villanova professor Charles Zech Courtesy of Charles Zech

But that doesn't mean the archdiocese could not raise money from those organizations, deep-pocketed individual donors and the rest of the Twin Cities Catholic community.

Zech said the archdiocese could ask the Catholic community to contribute toward a settlement. He said that the archbishop could even order parishes to contribute, since he controls most of the seats on individual parish boards.

"The archbishop says, 'Your parish will contribute.' They will contribute," Zech said.

But parishioners might rebel against such an edict — Zech doubts Archbishop John Nienstedt would try to tap other Catholic organizations, unless there is court pressure to do so.

"I can't see the archdiocese not fighting this tooth-and-nail and not trying to pay as little as possible to the victims," Zech said.

Archdiocese bankruptcy will include search for assets | Minnesota Public Radio News

Judges dismisses key sex abuse claims against archdiocese

 

The judge in the Archdiocese of Milwaukee bankruptcy on Wednesday dismissed nine sexual abuse claims involving priests and a counselor at a Catholic social service agency — the largest group of victims eliminated from the 4-year-old bankruptcy to date.

U.S. Bankruptcy Judge Susan V. Kelley threw out nine of 10 claims challenged by the archdiocese, saying seven of the victims failed to show evidence of fraud — the basis for their claims — and that lawsuits by two others had previously been dismissed by state courts.

The judge left one claim standing, at least for now: a man who alleges he was molested by the late Rev. Lawrence Murphy as a boy at St. Lawrence School for the Deaf in the 1970s. Murphy, one of the archdiocese's more prolific abusers, is believed to have molested as many as 200 boys over several decades.

Kelley said evidence suggests the archdiocese may have known as early as the 1950s that Murphy was molesting deaf boys at the school and failed to remove him, and that such disputes over facts must be litigated rather than dismissed on summary judgment as the archdiocese had asked.

The 10 claims taken up Wednesday — all identified by number because their claims were filed under seal —had been seen by some as test cases that could be used to dismiss large numbers of similar claims.

Victims voiced anger and disappointment at Kelley's dismissals of the nine. Arthur Budzinski, who also was molested by Murphy, drew little consolation from the other survivor's legal victory.

"It's ugly," Budzinski said through a sign language interpreter.

He lashed out at the archdiocese and its attorneys, who challenged the admissibility of the evidence against Murphy, including a letter from a Chicago priest who said he had reported Murphy to then-Archbishop Albert Meyer in the 1950s.

"The church needs to be honest. It's not being honest," he said.

Monica Barrett, whose claim involving the late Rev. William Effinger was disqualified because of a prior state court ruling, called Kelley's decision "a travesty of justice."

Barrett took issue with the judge's characterization of pedophile priests as "a few bad apples."

"That's insulting and demeaning to every survivor who suffered at the hands of these criminals," she said. "Let's call them what they are: criminals."

Jerry Topczewski, chief of staff for Milwaukee Archbishop Jerome Listecki, said Kelley's ruling affirms what the archdiocese has said for years about most of the sex abuse allegations against its priests — "that the vast majority of abuse was not known to the archdiocese until years after it occurred."

The 10 survivors are among the more than 500 individuals who filed sex abuse claims seeking compensation. The claims considered Wednesday involved some of the archdiocese's most notorious sex offenders, including Murphy, who is believed to have molested some 200 boys over the years; Effinger; and the late Rev. George Nuedling.

Wednesday's hearing was the latest legal battle in a costly and contentious bankruptcy filed by the archdiocese in January 2011 to address its sexual abuse liabilities dating back decades — and the latest in a string of legal victories for the archdiocese in the Chapter 11 proceedings.

Barred by Wisconsin courts from asserting negligent supervision — the claim asserted in most church abuse cases around the country — survivors allege instead that the archdiocese defrauded them by moving problem priests from post to post without divulging they were a danger to children.

Six of the survivors were unable to show Wednesday that the archdiocese knew about their abusers before they were molested because theirs were the first allegations to surface against those offenders. One, involving an unnamed priest, is the first and only accusation against that cleric, the archdiocese said.

Legal fees in the bankruptcy have totaled more than $16 million, according to the archdiocese. However, victims' attorneys and the advocacy group Survivors Network of Those Who Have Been Abused by Priests put it at more than $20 million. Each side accuses the other of dragging the case out by litigating every possible point. Under bankruptcy law, the archdiocese pays the bill for both sides…..

Read the entire article buy clicking on the following:  Judges dismisses key sex abuse claims against archdiocese

What mediation means for the archdiocese, insurers and victims | Minnesota Public Radio News

 

The mediation process is private and confidential, unlike a case that goes before a judge.

That promise of privacy invites candor — and encourages the parties involved to consider making concessions they might not otherwise make in open court.

"In mediation, the parties themselves get to say how much they're willing to give up — how much they're willing take, if you would, on either side of the table — and come to some resolution," said Christine Kubes, a construction attorney and mediator.

What about compensating victims?

Generally in a bankruptcy, there's not much dispute about individual abuse claims.

After it's determined how much money is available to compensate victims, a court-appointed adjudicator will decide how that money should be allocated to individual victims, based on the severity of abuse suffered. Settlements also typically include an apology to victims.

Insurers and parishes where sex abuse occurred will likely try to make sure that any settlement with victims doesn't leave the door open to abuse lawsuits against individual parishes.

Insurers and parishes may be on the same page in seeking, through the bankruptcy court, some sort of legal protection against future abuse claims

Read the entire article by clicking on the following:  What mediation means for the archdiocese, insurers and victims | Minnesota Public Radio News

Twin Cities archdiocese files for Chapter 11 bankruptcy | INFORUM

….

14th Catholic bankruptcy

Friday's filing marks the 14th Roman Catholic organization or group to file for bankruptcy protection since 2004. He's been involved in eight of them, he said.

"We will do this in a way that it's never been done before," Anderson said at a press conference in his office Friday. "In a way that can bring healing, it can bring compensation, it can advance change and not fight and get involved in contention and adversary relationships.

Past bankruptcies have varied widely, Anderson said. The average resolution takes about two years. Some have taken longer. The bankruptcy case of the Archdiocese of Milwaukee, for example, remains unresolved after four years. Anderson said the archdiocese there has contested all victims' claims and has haggled over how much will be paid to claimants.

Compensation for victims has also varied. In the Diocese of Helena, Mont., Anderson said victims received about $42,000 each. In the Diocese of San Diego, victims were awarded almost $1.4 million each.

It's unclear how much money will be made available to the more than 100 claimants here. That could hinge on whether the archdiocese contests validity of claims and on availability of insurance coverage, which is in dispute.

Anderson said for most victims, it's not about the money.

"It's really about making sure that other kids are not hurt, making sure they've done something to prevent it from happening in the future, and holding those responsible accountable in some way," Anderson said. "The filing of this bankruptcy ... doesn't keep us and the survivors with whom we're working from pursuing that objective."

More time to sue

In November, the archdiocese said its operating deficit can be partly attributed to the $4.1 million it has spent to address claims of clergy sexual abuse since May 2013, when the Minnesota Legislature opened a three-year window for victims to file claims against their abusers for abuse that occurred many years ago.

Since the act went into effect, 25 lawsuits have been filed; two have been settled.

Three lawsuits were scheduled to go to trial Jan. 26. Those proceedings are now stayed and their claims, along with any new claims, will be incorporated into the bankruptcy case.

Archdiocese officials said in November that because of the "significant number" of claims they've been told will be filed, the archdiocese could no longer draw from budget reserves.

Total operating revenue for the year ending June 30, 2014, was $25.5 million, compared with $32.7 million in 2013.

That decrease was largely due to a $7.7 million drop when the Catholic Services Appeal was shifted into a separate nonprofit organization at the start of 2014. The move assured donors that their contributions would go directly to specified ministries, instead of flowing through the chancery.

The archdiocese's chief financial officer, Thomas Mertens, wrote in the Nov. 20 issue of the Catholic Spirit, the official newspaper of the archdiocese, how a reorganization would affect operations:….

 

Read the entire article by clicking on the following:  Twin Cities archdiocese files for Chapter 11 bankruptcy | INFORUM

Milwaukee archdiocese reaches $2.3M settlement with insurers; half proposed for abuse victims - Milwaukee - Milwaukee Business Journal

 

The latest settlement would bring to $5.15 million the total amount available to people who have sought compensation. The new settlement figure was included in a motion filed Wednesday and is subject to approval by U.S. Bankruptcy Court Judge Susan Kelley in Milwaukee.

"Our relentless pursuit of insurance carriers has brought $10 million into the (reorganization) plan," archdiocese spokesman Jerry Topczewski told the Milwaukee Business Journal Friday.

Lloyd's of London previously agreed to pay $8 million to the archdiocese with $4 million of that planned as payments to clergy abuse victims and $4 million to pay the administrative costs of the case. The new development involves a settlement with OneBeacon Insurance Co. and Stonewall Insurance Co.

The archdiocese reached the latest settlement after mediation with insurers including OneBeacon and Stonewall.

Kelley has scheduled a hearing on the archdiocese settlement motion for Feb. 10, 2015.

Read the entire article:  Milwaukee archdiocese reaches $2.3M settlement with insurers; half proposed for abuse victims - Milwaukee - Milwaukee Business Journal

Milwaukee archdiocese bankruptcy cost: $12M | Press Gazette Media | greenbaypressgazette.com

 

Written by

M.L. Johnson

Associated Press

Bankruptcy has cost the Archdiocese of Milwaukee more than $12 million in legal fees and other expenses, and rejection of its recovery plan could force it to pay out $13 million more, its attorneys said in newly filed court documents.

The financial details were revealed in the archdiocese’s reorganization plan, filed late Wednesday night in federal bankruptcy court.

The plan proposes providing $4 million to compensate an estimated 125 victims of clergy sex abuse — less than a fourth of those who filed claims — while other victims would receive therapy but no cash payment. That’s the smallest per-victim payment yet offered by the 11 dioceses that have filed for bankruptcy in the past decade.

Read the entire story by clicking on the following:  Milwaukee archdiocese bankruptcy cost: $12M | Press Gazette Media | greenbaypressgazette.com

Milwaukee Archdiocese's bankruptcy filing now three years old - News - WTAQ News Talk 97.5FM and 1360AM

 

All sides have spent around $11 million in legal fees in what the Journal Sentinel calls one of the most contentious among nine Catholic bankruptcy cases in the country.  

The Milwaukee Archdiocese and its creditors have battled in court over the sale of church to pay the abuse victims -- and which victims are eligible to be compensated.  Legal experts say those battles may continue for years.  

Pamela Foohey of the University of Illinois College of Law predicts, "multiple objections on multiple bases." 

Milwaukee Archdiocese's bankruptcy filing now three years old - News - WTAQ News Talk 97.5FM and 1360AM

Stockton Catholic Diocese to file for Chapter 11 protection | Local News | Modesto Bee

By Sue Nowicki

snowicki@modbee.comJanuary 13, 2014

 

The Stockton Diocese announced Monday afternoon it will file Wednesday for Chapter 11 bankruptcy protection. The move affects only the diocesan budget and property and will not have an impact on the individually incorporated parishes or ministries, Bishop Stephen Blaire said. The creditors, mostly victims of sexual abuse by priests, are expected to challenge that statement.

The Stockton Diocese becomes the 10th in the country and the second in the state to move under the protection of the bankruptcy court. The action was taken to reduce the amount of money the diocese must pay in civil cases involving priests and sexual-abuse victims. It also will put a time limit on filing any new lawsuits concerning past sexual abuse. But in an interview with The Bee on Monday afternoon, Blaire said he wasn’t trying to hide assets or blame the legal action on the abuse victims, some of whom have received multimillion-dollar awards.

“Very simply, we are in this situation because of those priests in our diocese who perpetrated grave, evil acts of child sexual abuse,” he said. “We can never forget that these evil acts, not the victims of the abuse, are responsible

Read more here: http://www.modbee.com/2014/01/13/3132755/stockton-catholic-diocese-to-file.html#storylink=cpy

Milwaukee Archdiocese's bankruptcy plan is in the works

By Annysa Johnson of the Journal Sentinel

Three years after it declared bankruptcy as a way to deal with its mounting sex abuse claims, the Archdiocese of Milwaukee is poised to file the reorganization plan that will detail how it compensates abuse victims and operates as an institution into the future.

The archdiocese is preparing that plan, but it has offered few hints about its content or when it might be filed in U.S. Bankruptcy Court in Milwaukee….

With 575 sex abuse claims and legal fees topping $11 million, it is one of the largest and most contentious bankruptcies filed by Catholic dioceses around the country, say observers and lawyers who've worked on those cases.
Read more from Journal Sentinel: http://www.jsonline.com/mainheadlines/news/milwaukee-archdiocese-is-ready-to-file-bankruptcy-plan-b99180350z1-240195521.html#ixzz2qUXh0j

Insurance companies to buy back policies as part of Milwaukee Archdiocese bankruptcy - News - 1330 WHBL Sheboygan's News Radio

 

A group of insurers that includes Lloyd's of London has agreed to buy back policies they sold to the church, in exchange for avoiding liability in paying claims to victims of sex abuse by priests.

Church spokesman Jerry Topczewski would not say how much the archdiocese will get from the settlement. He says it will be spelled out in the church's financial re-organization plan which must be approved in federal bankruptcy court. Topczewski did not know when the plan will be filed. Media reports say settlement talks continue with another carrier, Stonewall Insurance.

Click on the following to read the entire article:  Insurance companies to buy back policies as part of Milwaukee Archdiocese bankruptcy - News - 1330 WHBL Sheboygan's News Radio

Multiple issues still await resolution in complex church bankruptcy

By Annysa Johnson of the Journal Sentinel

At the heart of the case are three key questions: Did the archdiocese defraud victims by exposing them to sexually abusive priests, teachers and others without warning them? Just who, among the 575 creditors who allege they were assaulted over the years, is entitled to compensation? And what church assets, including insurance coverage, can and should be made available to pay them?

Click on the following to read all of the story:  Multiple issues still await resolution in complex church bankruptcy

Milwaukee archdiocese shielded pedophile priests - chicagotribune.com

Brendan O'Brien and Geoffrey DavidianReuters

Roman Catholic Church officials in Milwaukee vigorously shielded pedophile priests and protected church funds from lawsuits during a decades-long sex abuse scandal, according to hundreds of documents released on Monday….

One document is a letter that Dolan sent to the Vatican in June 2007 requesting permission to move $57 million into a cemetery trust fund in order to protect the funds from "any legal claim and liability." The Vatican approved the transfer a month later, according to the documents.

Click on the following to read the whole story:  Milwaukee archdiocese shielded pedophile priests - chicagotribune.com

Michael D'Antonio: Milwaukee Documents Reveal Bishop Dolan's Bankruptcy Scheme and Frustration With Rome

 

Overall, the picture of Dolan that emerges in the papers is one of an administrator struggling to protect an institution's assets while defending its reputation. Some documents confirm that payments were made to induce priests who were accused of abuse to leave ministry and give up their faculties. Others show the bishop's frustration with Vatican officials and their slow-moving response to his requests that men who were credibly accused be dismissed from the priesthood. As years pass and the cases remain unresolved he referenced legislation that would allow for more lawsuits and wrote:

"The more we can demonstrate our seriousness about purifying the priesthood, as the Holy Father has implored us to do, the more we can speak credibly about the adverse effect of such legislation. Our critics challenge us on the fact that known abusers have still not been laicized."
Dolan's complaint represents one of the few instances where an American church leader's frustration with higher-ups in Rome has been made public

Click on the following for more details:  Michael D'Antonio: Milwaukee Documents Reveal Bishop Dolan's Bankruptcy Scheme and Frustration With Rome

Dolan welcomes release of Milwaukee deposition documents - NYPOST.com

 

I was grateful for the opportunity to go on-the-record with a full account of how the Archdiocese of Milwaukee responded to abuse survivors, and to answer any questions that I could. I stand ready to assist in any way that I can in the future. It is my hope that the release of these documents will also help in the healing process for abuse survivors, as well as their families and loved ones.

Click on the following for more details:  Dolan welcomes release of Milwaukee deposition documents - NYPOST.com

Archdiocese of Milwaukee | Chapter 11 Update - April 3, 2013

 

Chapter 11 Update - April 3, 2013

Most Reverend Jerome E. Listecki
Archbishop of Milwaukee

It has been more than 10 years since 2002, when the news about clergy sexual abuse of minors dominated news headlines across the country and changed forever the way the Catholic Church would be viewed because of this issue.  I’m sorry this Love One Another is a little longer than usual, but there is so much ground to cover with this topic that I ask your patience.  And, although you usually receive my email on Tuesdays, I send this today because I wanted you to hear this news directly from me.

This has been an especially poignant topic in the Archdiocese of Milwaukee as hundreds of courageous abuse survivors have come forward to tell their story.  I beg the forgiveness of those who have been harmed.  For myself and in the name of the Church I give those abuse survivors and their families my sincere apology. 

The challenges facing the archdiocese are many.  First, acknowledging the scandalous and embarrassing facts about how men, who were trusted priests, shattered that trust through their sinful and criminal behavior.  Second, learning how some in advisory and leadership roles made ill-advised decisions, even if that only became clear in hindsight.  Then there have been financial challenges – settling lawsuits, failed mediation attempts and, ultimately, my decision to file for Chapter 11 financial protection in 2011.

However, there are things the archdiocese can be proud of.  In the 1990s, the archdiocese was one of the first in the country to implement a formal response to abuse survivors, to hire staff to support their needs, and to publish a Code of Ethical Standards for church employees.  The archdiocese has supported legislation to include clergy as mandatory reporters of abuse from the time a bill was first introduced in the mid-1990’s  until it was eventually signed into law. Even before this legislation was passed, the archdiocese had its own policy requiring employees, including clergy, to report suspected child abuse to the proper civil authorities.  Our policies and protocols ensure that all abuse allegations involving someone who is still alive are immediately reported to civil authorities. Safe environment education programs were developed and are now mandatory for children and youth in every parish and school. Criminal background checks and sexual abuse awareness training are required for every bishop, priest, deacon, staff member and volunteer who works with minors. Most importantly, no priest with a substantiated allegation of sexual abuse of a minor can in any way exercise public ministry in the Archdiocese of Milwaukee. 

Another way we have addressed this crisis is to be open in sharing facts about what happened in the past, what we are doing today and what we pledge to do in the future. 

My predecessor, Cardinal Timothy Dolan, was candid in his sharing of information, including providing a public listing of all diocesan priests with substantiated allegations of sexual abuse of a minor.  Since my arrival as your archbishop in 2010, I have tried to maintain that same direction in my ministry.  Building upon our commitment to transparency, today I have authorized the public release of thousands of pages of documents that contain information and details about clergy sexual abuse in the Archdiocese of Milwaukee.   The documents will be posted to the archdiocesan website by July 1, 2013.

These documents have already been provided to attorneys for the claimants and creditors in the Chapter 11 bankruptcy proceeding.  They are taken directly from priest personnel files, files of the bishops, vicar for clergy, and other sources within the archdiocese.  These documents include the depositions of Archbishop Weakland, Bishop Sklba and Cardinal Dolan, which were taken in the Chapter 11 proceeding.  Each of the bishops has told me they welcome the opportunity to have the depositions in the public view as a way of getting out the truth of what happened and each has voluntarily waived their right to have these depositions remain under seal as was promised by the court. 

My hope is by making these documents public, we will shed much-needed light on how the archdiocese responded to abuse survivors over the past 40-plus years when confronting this issue and that they will aid abuse survivors and others in resolution and healing.

A primary concern is protecting the identity of abuse survivors who do not want to be identified.  During these next months, we will meticulously review these documents to ensure that the privacy of abuse survivors and their families is respected.

A difficult challenge in reading these documents is trying to set the context and culture of the time they were produced. How sexual abuse is acknowledged and addressed today is far different than in past decades.  Depositions, for example, are not objective, but are one-sided by their nature.  To try and ensure the documents are judged fairly, the archdiocese will create an objective timeline of events for each diocesan offender on the list of clergy with substantiated allegations of sexual abuse of a minor. These timelines will be supported by the actual documents being released and our hope is to work with the claimants’ attorneys to create these timelines.

Much of the information in the documents is not pleasant to read.  As a shepherd, I worry about those who will feel outrage, anger and embarrassment.  I share those emotions.  But none of these things should diminish the good work that has been accomplished these past 10+ years as we have worked fervently with abuse survivors to bring healing and resolution.  I believe sharing these documents publicly will finally bring to a close a criticism that the Church continues to hide or conceal information, or that there are “secret files” tucked away in our archives.  I can assure you, there are not.

So what will people find in reading these documents?  Here’s a summary:

• The incidents of abuse date back 25, 50, even 80 years.
• The vast majority of perpetrators were not known to the archdiocese until years after they committed the abuse.
• Reports of abuse were often not brought to the archdiocese or civil authorities until decades after they occurred.
• In the 1970s and 80s, priests were often removed from their parish for “medical reasons,” sent for counseling, and then reassigned to another parish, with the recommendation of their therapist or medical professional.
• The majority of priests who were reassigned after concerns about their behavior, never abused again, but some did.
• The archdiocese consistently paid for therapy for individuals harmed.
• Civil authorities did not always pursue investigations and neither did the archdiocese.
• Even when priests were prosecuted and found guilty or pled no contest, they did not always receive a jail sentence.
• People often reported concerns about a priest that were not abuse, but rather concerns about unusual or questionable behaviors, boundary issues or uninvited attention/affection -- what we know today as possible signs of “grooming.”
• In the early 1990s, a more formalized approach of outreach to abuse survivors and in dealing with offenders began to emerge.

Some of you might ask, “Why?  Why keep bringing this up?  Let this be over and move on.”  Part of me would like it if that was even possible, but I know the effects of clergy sexual abuse of minors will never be over.  The release of documents is something abuse survivors have asked for and if it can help us keep moving forward, I am willing to do it.  Our response to abuse survivors, whether of clergy or others, will be part of the mission of the Church forever. 

Other people will feel justified indignation; believing that these documents verify that the Church was sweeping this issue under the rug.  I won’t debate that issue; we will let the facts stand for themselves within the culture and societal practices of the times.  But, I do know this.  What we have seen in the Church, we have now begun to see in other institutions.  One thing we do know is that the Church is now an example of reform.  Have you ever seen an institution change more radically in its approach to an issue as the Catholic Church has done regarding sexual abuse of minors?  In the past, the Church may have been an example of what not to do, but now, the Church is an example of what to do and a model for other institutions in our society to follow.

We must remember that our Church is a Church of sinners, comprised of imperfect men and women.  Our faith remains in the One who is perfect – the head of the Church, Jesus Christ.  And, as Jesus tells us in the Gospel of John, “then you will know the truth and the truth will set you free.” 

You have my assurance of prayers for you during this joyous Easter season, as we continue our journey in faith and following the Lord’s command to LOVE ONE ANOTHER.

Archdiocese of Milwaukee | Chapter 11 Update - April 3, 2013

Archdiocese of Milwaukee Heads Toward Insolvency - ABC News

 

Archdiocese spokesman Jerry Topczewski (top-CHES'-kee) says savings, reserves and investment earnings have all been exhausted. And if it doesn't stop paying attorneys and consultants, the archdiocese will be unable to pay its monthly operating expenses beginning in April.

Click on the following for more details:  Archdiocese of Milwaukee Heads Toward Insolvency - ABC News

Bankruptcy judge: local parishes won't have to pay for priest sex-abuse - WTAQ News Talk 97.5FM and 1360AM

 

Federal Bankruptcy Judge Susan Kelley said the parishes will not put all of their assets at risk, as she decides how much the Milwaukee Archdiocese must pay to sex abuse victims and other creditors in its nearly two-year-old bankruptcy case.

Kelley ruled that the parishes are their own legal entities – but they’re not out of the woods just yet. The parishes could still be sued, as the creditors try to obtain $35-million the local churches obtained from the archdiocese in 2005. The creditors say the archdiocese committed fraud by taking the money off its books

Click on the following for more details:  Bankruptcy judge: local parishes won't have to pay for priest sex-abuse - WTAQ News Talk 97.5FM and 1360AM

Local Law Firms: Creditors’ Strategy for Archdiocese of Milwaukee Bankruptcy: News

 

The creditors committee of abuse victims who have won lawsuit awards against the Archdiocese of Milwaukee has outlined a multi-pronged strategy they plan to pursue to get past the bankruptcy filing by the archdiocese.
The main component of the new strategy is that lawyers for the victims will go after the individual parish assets. ….

Another issue at stake is the ownership of the Cousins Center, the headquarters of the Archdiocese of Milwaukee. Until recently, they had claimed to be the owners and had promised they would sell it to pay off the court settlements. However, they now claim not to own the building….

Another hidden asset that has come to light is previously undisclosed insurance coverage….

A pending lawsuit over a $57 million cemetery fund could also be included in …..

Click on the following for the entire article:  Local Law Firms: Creditors’ Strategy for Archdiocese of Milwaukee Bankruptcy: News

Progress seen in Wis. church mediation - UPI.com

 

The case is the largest of Catholic diocesan bankruptcy to date in terms of the number of claimants, nearly 500, who say they were sexually abused by an individual working for the church, the newspaper said.

Click on the following for this story:  Progress seen in Wis. church mediation - UPI.com