Last week, the Diocese of Sacramento obtained approval from the Bankruptcy Court to sell undeveloped cemetery property located in Riverside, California for $2,697,000.00. The net proceeds of the sale will stay with the Diocese until the case is resolved. FTI (the Official Committee’s real estate advisors), reviewed the sale process and the sale price and determined that the Diocese conducted a proper marketing process and that the sale price was reasonable. As a result, the Committee supported the sale. The Committee will continue to review all real estate sales proposed by the Diocese to ensure that the maximum amount will be available to Survivors in a bankruptcy settlement.

Survivors involved with the Archdiocese of New York and Archdiocese of New Orleans have seen important developments recently.  

In New York, the Archdiocese has announced it enter a formal negotiation process with attorneys for Survivors and commit at least $300 million to compensate the 1,300 victims of sexual abuse with claims pending against the church. Additional information may be found here.  

In New Orleans, Survivors and the Archdiocese reached a settlement of $230 million, approved by the bankruptcy court, to address the claims of approximately 600 Survivors who have been a part of this bankruptcy since it was filed in May of 2020. Further information about the New Orleans case can be found here. 

Both of these developments point to the recognition that significant financial settlements are appropriate to address the harm that Survivors have endured during their lifetime.  While every bankruptcy proceeding is unique, these are positive developments for Survivors.  If you have legal representation and questions related to your case, you should direct them to your attorney.  If you have questions about the bankruptcy process in general, you may email Stinson LLP via sacramentosurvivorteam@stinson.com.  Every message will receive a response.

The Diocese of Sacramento obtained approval from the Bankruptcy Court to sell a property located in Oroville, California for $415,000.00. The net proceeds of the sale will stay with the Diocese until the case is resolved.   In the professional opinion of FTI (the Official Committee’s real estate advisors), this sale price is within the range of reasonable values for the property, so the Committee supports the sale.  The Committee will continue to review all real estate sales proposed by the Diocese to ensure that the maximum amount will be available to Survivors in a bankruptcy settlement.

Judge Littlefield Rules Insurers Do Not Have Standing to Object to Survivor Claims

In a significant victory for Survivors, Judge Littlefield has issued a decision that has wide-ranging implications. Specifically, Judge Littlefield concluded that insurers who deny that they are financially responsible for survivor claims do not—without more—have standing (the ability to act in Court) to object to survivor claims. The decision is instructive with regard to when and whether insurance companies have the ability to act in bankruptcy cases.

In the Diocese of Albany case, two of the Diocese’s insurance carriers, London Market Insurers and the Hartford, objected to nearly 50 survivor claims. The Committee challenged the objections, arguing that the insurers did not have standing to object. Judge Littlefield agreed, writing:  “As the Court stated on the record, it is difficult to “understand how [the Insurers] create the thread that [the Insurers] have standing when [they] have nothing at stake, [they] have no skin in the game.” 

The Committee applauds this decision and is hopeful that it will recognized across the country in situations where insurance companies attempt to interfere in bankruptcy cases to the detriment of Survivors.