Archdiocese pledges $62.5M to survivors

by Peter Finney Jr.

By Peter Finney Jr.
Clarion Herald

The Archdiocese of New Orleans pledged Sept. 13 to contribute $62.5 million plus additional real estate and insurance proceeds toward the resolution of hundreds of sexual abuse claims against priests, deacons, religious and laity who worked for the church over the past several decades.

The Unsecured Creditors Committee representing the abuse survivors also filed a plan of reorganization seeking hundreds of millions of dollars to settle the abuse claims, which experts say would leave the ministry of the archdiocese financially crippled and unable to operate.

“Today, we reached a milestone in this process,” Archbishop Gregory Aymond said in a letter to the people of the archdiocese. “While there is still much work to do, this will allow us to move forward and begin to bring conclusion to these proceedings through meaningful and frank negotiations.”

In the plan of reorganization and disclosure statement filed with the U.S. Bankruptcy Court, the archdiocese proposed the creation of a trust to administer the settlement funds and also said the settlement trust fund would have an independent trustee and claims reviewer, who would have the sole discretion to evaluate each claim and make payments to those who had been harmed.

Trust would pursue claims

Under the archdiocese’s plan, certain rights and claims under its insurance policies would be
transferred to the trust. The trust would then be charged with pursuing claims, which will add to the amount of money abuse survivors receive in settlements.

“We know that no amount of money can provide complete healing,” Archbishop Aymond wrote. “For most of the survivors, this is suffering that has persisted as long as 40 and even 50 years. For the pain of those that have suffered abuse, we are truly sorry. We regret that abuse occurred causing decades of pain for survivors. We pledge to continue our work that has been effective in protecting children and continue to pray that our actions, outlined in this plan, will bring healing to survivors now and into the future.”

The archbishop said the plan will include a proposed set of “non-monetary covenants” that is being negotiated with the committee of abuse survivors.

“These non-monetary covenants are actions that we publicly pledge to take to continue our commitment to ensuring our parishes, schools and ministries are safe places for all to grow in faith, be educated and to participate in ministry,” Archbishop Aymond said.

Monetary breakdown

The key items in the archdiocesan reorganization plan and disclosure statement pledge the archdiocese to contribute $50 million to the settlement, while the other entities, referred to as the “apostolates,” would contribute $12.5 million. In addition to the cash component, both the archdiocese and the apostolates would sell real estate that will be added to the trust to pay abuse claims.

The plan submitted by the Unsecured Creditors Committee, which represents the abuse survivors, seeks cash payments of $84 million from the archdiocese, $133 million from the apostolates and about $780 million from insurance companies. The plan filed by the Unsecured Creditors Committee also seeks the sale of real estate and personal property and requests a share of all future donations in addition to the cash component.

Trustee to be appointed

Both plans provide for the appointment of a settlement trustee selected by the abuse survivors who oversee the payments to survivors. The trustee, with the assistance of a claim’s reviewer, will determine the value of claims and whether to object to the claims or not. The archdiocese will not be the party that determines the claims’ value or whether they will be the subject of an objection.

Both plans contain a “channeling injunction” that precludes abuse survivors from filing suit against a parish or service entity for abuse claims that occurred before May 1, 2020. However, individual abuse survivors have the right to opt-out of the injunction. Those survivors who choose to opt out would retain the right to sue a parish or a service entity and the insurer, but would receive a smaller recovery.

As a result of the clerical sexual abuse crisis, 39 dioceses, archdioceses and religious congregations have filed for Chapter 11 reorganization since the early 2000s.

Time, cost ‘frustrating’

“The time and cost associated with this bankruptcy have been frustrating to all and have been of no benefit and unjust to the survivors, today’s church and all interested parties,” Archbishop Aymond said in his letter. “We also know that today is the beginning of a process to bring closure and that there are many more steps before we reach a true conclusion. I wish to request your patience and your prayers as we continue this process.

“Today is a day of hope for the future of the Archdiocese of New Orleans. Please know that I remain committed to moving forward and for healing for our local Church.”

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