Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Archdiocese of Saint Paul and Minneapolis Files For Bankruptcy
Author: Joel R. Glucksman
Date: January 22, 2015
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The Archdiocese of Saint Paul and Minneapolis has been under fire for quite some time regarding alleged sexual abuse by its member priests.
The Archdiocese of Saint Paul and Minneapolis filed for protection under Chapter 11 of the bankruptcy law on Jan. 16, according to The Star Tribune. The filing appears to reflect the Archdiocese’s belief that it cannot meet financial obligations arising from the wave of lawsuits over alleged sexual abuse. The bankruptcy filing will freeze the lawsuits against the church and protect the Archdiocese from creditors while it develops a plan of reorganization.
“I make this decision because I believe it is the fairest and most helpful recourse for those victims/survivors who have made claims against us,” wrote Archbishop John Nienstedt on the Archdiocese of Saint Paul and Minneapolis website the morning of Jan. 16. “Reorganization will allow the finite resources of the Archdiocese to be distributed equitably among all victims/ survivors. It will also permit the Archdiocese to provide essential services required to continue its mission within this 12-county district.”
About two dozen lawsuits have been filed against the Archdiocese of Saint Paul and Minneapolis for past sexual abuse, and the organization has received notice of more than 100 potential claims, The Associated Press reported. It is the 12th U.S. diocese to seek protection under the bankruptcy law as a result of sexual abuse claims.
The bankruptcy filing showed that the archdiocese had estimated liabilities between $50 million and $100 million and estimated assets of $10 million to $50 million, according to The Star Tribune. All of the organization’s top 20 creditors are victims of clergy sex abuse.
Victim advocates decried the decision to file for bankruptcy, arguing that the archdiocese is shirking its responsibility to victims.
“Why is it that when all the dioceses file bankruptcy, they do it on the eve of a trial?” Bob Schwiderski, an advocate for abuse survivors, asked The Star Tribune. “Is it because they can’t put their hand on the Bible and swear to tell the truth?”
Sex scandals, bankruptcy… What’s next for Archdiocese of Saint Paul and Minneapolis? Feel free to comment below.
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