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Queens Chronicle

Brooklyn diocese could file for Chapter 11

Child Victims Act opens floodgate to lawsuits church cannot pay

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Posted: Thursday, August 15, 2019 10:30 am

An unknown number of victims of child sex abuse this week got the chance to bring their case to court under a new state law that went into effect on Wednesday.

The predicted onslaught of lawsuits could be so large that the bishop of the Diocese of Brooklyn said it may have to file for bankruptcy.

One Manhattan law firm announced Wednesday morning it had begun action on behalf of 170 sex-abuse victims against the Catholic Church in several New York dioceses.

The Child Victims Act, signed into law last spring by Gov. Cuomo, created a one-time only, one year “look back” window for the adult victims of sex abuse who were precluded from suing by statutes of limitation that were already on the books.

“We do not know how many lawsuits we will face during this window period, and if we will have to declare bankruptcy as a result,” Bishop Nicholas DiMarzio wrote in an open letter in the current issue of The Tablet, the church’s official newspaper.

“What we do know is that litigation can be a lengthy endeavor,” he wrote.

Dioceses in at least seven cities have declared Chapter 11 bankruptcies since 2004 because they could not handle the financial strain of legal settlements and jury awards to the victims of priest abuse.

Spokane, Wash., Portland, Tucson, San Diego, Wilmington, Del. and Milwaukee have been among the dioceses that filed when faced with multimillion judgments.

Once the courts approve a petition for Chapter 11 protection, it means that all settlements have to be worked out and approved in federal bankruptcy court.

The dioceses said bankruptcy was necessary to protect school funds and trusts.

Money held by the separate parishes did not belong to the dioceses and should not be subject to jury awards, they argued.

In some cases, it allowed the dioceses to set aside a compensation fund from which all claims were paid, protecting the church’s other assets.

“To date, the [church] has settled claims with nearly 500 victims of the Diocese of Brooklyn,” DiMarzio said.

“The diocese has paid settlements by selling and mortgaging properties. None of the money used has come from donations.

“While no amount of money could ever heal the scars of abuse, the compensation program has been one way for us to show a concrete expression of our contrition and our desire to make amends.”

Meanwhile, the diocese announced earlier this week that its investigation into allegations of sex abuse against four priests had found the charges “credible” against two of them.

All of the alleged incidents are said to have taken place in the 1970s.

Only one priest, Father Charles White, 79, who was found culpable had served at American Martyrs Church in Bayside. The other priest against whom charges were upheld served at churches in Brooklyn.

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