3/31/17, "Montana Diocese Seeks Chapter 11 Protection to Address Abuse Claims," Wall St. Journal, Tom Corrigan (subscrip)
"Great Falls-Billing
diocese becomes 17th U.S. diocese or religious order to seek
bankruptcy-court protection while facing litigation over sexual-abuse
allegations.""The Roman Catholic Diocese of Great Falls-Billings, Mont., filed for bankruptcy protection Friday, becoming the 17th in a growing number of troubled Catholic dioceses and religious orders to turn to chapter 11.
The diocese’s bankruptcy filing comes in the face of 72 lawsuits claiming child sexual abuse by priests and other diocesan staff. More claims may be filed as the case goes through the bankruptcy process.
Great Falls-Billings Bishop Michael Warfel told The Wall Street Journal he has already met with several sexual abuse victims and is open to meeting with all of them.
“A lot of people have carried wounds for many years, and I am very sensitive to that,” he said Friday. “It’s really important in the healing process for victims to meet with the bishop and the diocese, and I encourage it.”
All diocesan bankruptcies to date—from the Archdiocese of Portland, Ore., in 2004 to the Diocese of New Ulm, Minn., which filed in March—have been driven by mounting liabilities tied to the past sexual abuse of minors.
Filing for bankruptcy offers the diocese immediate protection from all pending and future lawsuits, giving it breathing room to continue its ministry while it finalizes a plan to compensate victims.
“On behalf of the entire Diocese of Great Falls-Billings, I express my profound sorrow and sincere apologies to anyone who was abused by a priest, a sister or a lay Church worker,” the bishop said in a statement Friday. “No child should experience harm from anyone who serves the Church.”
Bishop Warfel added that no priests from his diocese facing credible accusations of abuse are in active ministry and that most are deceased. The vast majority of abuse allegations involving the Catholic Church in the U.S. occurred decades ago.
The Diocese of Great Falls-Billings covers nearly two thirds of the state of Montana, but serves a relatively small population.
According to its website, the diocese has about 40,000 parishioners, 42 active priests, 50 parishes and 50 missions.
In bankruptcy court papers, the diocese listed total assets of about $21 million. The diocese’s parishes aren’t separately incorporated, and it isn’t clear how much, if any, of their assets will be included in a future bankruptcy settlement.
The Great Falls-Billings diocese enters bankruptcy with a negotiated agreement with both victims plaintiffs and its insurance carriers, which aims to help speed up the chapter 11 case. The agreement, reached with the help of a mediator, provides a road map intended to avoid legal obstacles at the outset of the case, according to Ford Elsaesser, a lawyer for the diocese.
Mr. Elsaesser says he expects the case to follow in the footsteps of the Diocese of Helena, Mont., a neighboring diocese that sought bankruptcy protection in 2014.
The Diocese of Helena eventually reached a $21 million settlement with about 380 victims, largely through out-of-court negotiations. The diocese spent just over a year in chapter 11 but less than five hours in court, according to Mr. Elsaesser, who also represented the Helena diocese.
Other U.S. diocesan bankruptcies, however, have been protracted and hard-fought, with many stretching out over several years.
The Archdiocese of Milwaukee’s bankruptcy lasted nearly five years, and a dispute over access to assets reached the U.S. Supreme Court before it was settled. And the Archdiocese of St. Paul and Minneapolis, now in its third year of chapter 11, has been unable to reconcile with victims and the two sides are moving forward with competing—and starkly different—compensation plans.
Not everyone agrees that bankruptcy is the best forum for handling sensitive allegations of past sexual abuse. Critics say the process can deprive victims of the opportunity to present their stories to a jury and can force other victims to come forward before they are ready. Once a bankruptcy comes to a close, victims whose claims stem from abuse that occurred prior to the bankruptcy are typically barred from taking their allegations to court.
“While we had hoped to obtain justice for our clients at trial, we are hopeful that the diocese’s bankruptcy will result in nonmonetary terms for the protection of children and monetary recognition of the tragedies endured by victims,” Leander James, an attorney for a group of victims, said in a statement Friday."
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Added:
16 other US Catholic organizations that have filed for bankruptcy since 2004 due to expenses, 14 dioceses plus two Catholic groups, Oregon Province of the Jesuits (2/17/09), Congregation of the Christian Brothers (4/28/11):
"Dioceses and Religious Orders That Have Filed for Bankruptcy Protection," Bankruptcy Protection in the Abuse Crisis, bishopaccountability.org
1. Archdiocese of Portland OR (filed 7/6/04)
2. Diocese of Tucson AZ (9/20/04)
3. Diocese of Spokane WA (12/6/04)
4. Diocese of Davenport IA (10/10/06)
5. Diocese of San Diego CA (2/27/07)
6. Diocese of Fairbanks AK (3/1/08)
a. Oregon Province of the Jesuits (2/17/09)
7. Diocese of Wilmington DE and MD (10/18/09)
8. Archdiocese of Milwaukee WI (1/4/11)
b. Congregation of the Christian Brothers (4/28/11)
9. Diocese of Gallup NM (11/12/13)
10. Diocese of Stockton CA (1/15/14)
11. Diocese of Helena MT (1/31/14)
12. Archdiocese of St. Paul and Minneapolis MN (1/16/15)
13. Archdiocese of Milwaukee a proposed settlement was announced (8/4/15)
14. Diocese of Duluth MN (12/7/15)
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