Diocese reaches $147.8M settlement of sex abuse claims

The Roman Catholic Diocese of Rochester, New York, has reached a proposed $147.8 million settlement of sex abuse claims with its insurers, according to a motion filed in federal bankruptcy court.

The proposed settlement was criticized by a plaintiff attorney who represents sex abuse victims in the case.

Separately, on Monday the judge overseeing the diocese’s bankruptcy gave permission for sex abuse victims to proceed with litigation against individual parishes and other entities within the Rochester diocese.

The diocese’s motion, which was filed Friday, says insurers have agreed to pay $107,250,000 to a survivor trust to be established, while the dioceses would contribute an additional $40,500,000, according to the motion filed in U.S. Bankruptcy Court in Rochester in The Diocese of Rochester v. The Continental Insurance Co. et al.

The largest portion of the settlement, $63.5 million, would be paid by CNA Financial Corp., which provided primary insurance to the diocese from March 1952 to June 1977, according to the motion.

CNA also issued excess insurance to the diocese from June 1969 to June 1972 and from June 1975 to June 1977, which provided $3 million per occurrence.

The motion states that before deciding to settle with the insurers, the diocese considered several alternative strategies, including moving forward with litigation against the insurers or assigning its insurance policies to the trust for post-confirmation coverage litigation, but ultimately determined the survivors’ interest “would be best served” by the settlement.

Boston-based attorney Mitchell Garabedian, who represents 97 sexual abuse plaintiffs in the case, said the settlement is “extremely low” considering there is more than a billion dollars of insurance.

Separately, bankruptcy judge Paul R. Warren issued a ruling denying the diocese’s motion to enjoin litigation against individual parishes, schools and other Catholic entities and institutions, according to the ruling issued in The Diocese of Rochester vs. AB 100 Doe, et al.

The ruling states that for more than two years, child sexual abuse victims have refrained from moving forward with their state court civil actions against the parishes and others, none of whom have filed for bankruptcy protection, under terms of a “standstill agreement.”

The Diocese “has repeatedly reminded the Court that the assets of the Catholic Corporations are beyond the reach of the Bankruptcy Court,” the ruling said.

The ruling says that after eleven extensions, the abuse survivors have refused to extend the standstill agreement beyond March 23.

“In the two and a half years that have passed since the Chapter 11 case was filed by the Diocese, at least three Abuse Survivors have died, without ever having the chance to tell their stories to a state court jury,” the ruling says, in denying the diocese’s motion to enjoin state court actions against these entities.

The motion states the survivors are not permitted to enforce a state court judgment against an insurance policy that provides coverage to the diocese as a named insured without first obtaining the court’s permission.

Other attorneys in the case did not respond to requests for comment.

The Diocese of Camden, New Jersey, said last month it had reached an $87.5 million settlement with about 300 survivors of sexual abuse.

 

 

 

 

 

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