Diocese files objections to nearly 100 sexual abuse complaints

The Roman Catholic Diocese of Rochester on Friday opposed nearly 100 claims filed by survivors of sexual abuse in its pending Chapter 11 bankruptcy, a decision that could slash tens of millions from any payout that he performs in the case.

The objections come late in the nearly three-year-old case and long after the claims were originally filed. They also come as tensions between the survivors and the diocese rise as the two sides fight over a settlement offer that the survivors despise as too little, too late.

In the offer, the diocese proposes to pay survivors a total of $145.75 million, with its insurers covering $105 million of that amount.

Dismissing objections to the claim raised on legal technicalities and a contradiction to the Bishop of the Diocese of Rochester Salvatore Matano’s stated concern for survivors, an attorney representing survivors in the case has vowed to vigorously fight objections. .

Such objections in diocesan bankruptcies are “unheard of and quite significant in my view,” says Leander James, an attorney representing 76 survivors of abuse in the Diocese of Rochester bankruptcy.

“fiduciary responsibility”.

As of July 22, the diocese had filed 97 claims. If all were to be denied, it would reduce the Diocese’s payment by up to $30 million.

Each of the 97 claim objections cites an affidavit filed by the Chancellor of the Diocese of Rochester, the Reverend Daniel Condon. The filing lists various schools, organizations affiliated with the diocese, and Catholic colleges of teachers as legally separate entities and argues that the diocese is not liable for offenses committed by employees or officials of these unrelated parties.

Noting that under Church law all Catholic organizations operating within the diocesan compound serve under the authority and pleasure of diocesan bishops, James dismisses the diocese’s position as dishonest but virtually certain to add significant costs to a bankruptcy that has already accumulated more than $7 million. in expenses.

In New York, parishes, schools, and other branches of state Catholic dioceses are legally registered as separate corporations. The bishop of each diocese is appointed at the head of each parish corporation.

If all of the late-filed bankruptcy objections were challenged, James says, each would add many billable hours to the fees charged by attorneys representing the diocese as well as expenses related to discovery requests for documents and records, amounts that would s ‘Add to the $7 million that the diocese has so far spent on the bankruptcy and would further reduce the damages recovered by survivors.

Rather than independently litigate hundreds of claims against diocesan affiliates, James says the survivors seek to reach a comprehensive bankruptcy settlement in which those related parties would contribute along with the diocese and its liability holders.

In pursuing objections to the claim, the diocese maintains in its statement that it seeks to resolve “this matter with justice, charity and in a timely manner.”

The diocese filed for Chapter 11 court protection in September 2019, a month after New York’s Child Victims Act took effect. Promulgated in February of the same year, the CVA entered into force in August 2019.

The law opened a window of about two years in which adults who suffered abuse decades ago as children but did not file a complaint within the seven-year statute of limitations could seek damages to their alleged attackers. The CVA opened a floodgate, sending hundreds of such claims against the Catholic Diocese of Rochester and affiliated organizations like parishes in the diocese’s 12-county region.

The diocese is currently facing 475 sexual abuse survivor claims in Chapter 11. Parishes in the Diocese of Rochester and other affiliated churches in the diocese are fighting some 300 sexual abuse claims filed separately in state courts across the region. .

Rochester Bankruptcy Court has set January 27 as the court date for a hearing on the Diocese’s $146 million settlement offer. The lengthy delay appears to suggest that the court, which ordered the diocese, its insurers and the case’s official creditors’ committee to mediation still ongoing nearly two years ago, would like to see the dispute settled without further litigation. .

The official bankruptcy creditors’ committee is a body composed of survivors and appointed by the US trustee to look after the interests of survivors in the bankruptcy. He filed objections to the settlement, complaining that it is financially insufficient and that it was reached in negotiations between the diocese and its liable insurers without any contribution from survivors.

One of the diocese’s insurers, the Continental Insurance Co., filed a response to the creditors’ committee last week, saying the diocese’s insurance coverage is less than the creditors’ committee claims and that it doesn’t. actually owes nothing. Liability company for the Lloyds of London Diocese also filed a brief last week, saying survivors had better accept the settlement.

The recent offer came months after Bankruptcy Judge Paul Warren rejected a $35 million diocesan offer, which survivors also decried as having been made without their contribution.

The diocese, insurers and creditors’ committee have been involved in the mediation since 2020. Survivors have expressed frustration with the talks, complaining that they have been stalled for too long without results.

Warren ordered the mediation after insurers asked him for permission to file a lawsuit in state court in which they planned to avoid liability to cover at least some sexual abuse claims against the diocese.

As mediation continued to stall, in late March the creditors’ committee backed out of a bankruptcy court agreement signed early in the case that had frozen state court claims against the parishes. and other legally separate affiliated dioceses pending the outcome of the bankruptcy.

The resumption of several hundred long-dormant lawsuits against diocesan affiliates, which are proceeding on separate tracks from the Diocese’s Chapter 11, is putting further pressure on the parties to reach a mutually agreeable settlement. It is unclear whether such an agreement will materialize before the January 28 settlement offer hearing.

Earlier this month, Warren appointed a second mediator, an insurance law expert, to serve alongside the Nevada bankruptcy judge who has overseen the mediation since it began two years ago.

Two new mediation sessions are scheduled to be held this week at the Perinton offices of Harris Beach PLLC on July 27 and 28.

The diocesan statement cites the upcoming sessions as “an ongoing effort to arrive at a consensual plan of reorganization that will provide fair compensation to those who have been wronged.”

Insurers have agreed to participate in this week’s sessions but have not committed to further discussions beyond those two, Warren’s order says.

Does Astor is the Senior Writer of Rochester Beacon. The Beacon welcomes feedback from readers who adhere to our comment policy including the use of their full real name.

Anne G. Cash