SACRAMENTO – The Diocese of Sacramento will seek Chapter 11 bankruptcy protection after greater than 250 lawsuits claiming sexual abuse by clergy and other staff, Bishop Jaime Soto said on Saturday.
Soto said the diocese intends to hunt Chapter 11 protection by March 2024.
“There are many victim-survivors awaiting compensation for the reprehensible sins committed against them,” Soto said in an announcement to his parishioners. “The diocese faces greater than 250 lawsuits alleging sexual abuse by clergy or other church staff. The reorganization process will allow me to equitably reply to the big variety of those that are victim-survivors of abuse.”
Under Chapter 11 protection, a court would oversee how available assets could be distributed to satisfy claims against the diocese. Victim-survivors could be represented in a court-supervised proceeding, the diocese said.
In an announcement, the group Survivors Network of those Abused by Priests (SNAP) criticized the bankruptcy move.
“It is just not true that bankruptcy is the one approach to achieve a ‘fair consideration’ of all the survivor’s lawsuits. In the last window, universal agreements were reached between the Church, survivors, and their attorneys, without the draconian consequences that bankruptcy will bring together with it. What can also be true is that victim’s settlements are normally reduced in bankruptcy,” SNAP wrote.
A fund could be created to distribute to all victims, the diocese said.
“Without such a process, it is probably going that diocesan funds could be exhausted by the primary cases to proceed to trial, leaving nothing for the various other victim-survivors still waiting for compensation,” the diocese said in an announcement.
Soto announced in March that filing for bankruptcy was a possibility.
“It is the sickening sin of sexual abuse – and the failure of church leadership to handle it appropriately — that brought us to this place. I need to atone for these sins,” Soto said.
From Dec. 31, 2019, to Dec. 31, 2022, the state heard suits filed that alleged sexual abuse by the Catholic church no matter whether the statute of limitations had run out. It resulted in 1000’s of latest cases across California.
In Sacramento alone, the Diocese sent out a letter to their congregation stating they’d received over 200 filings alone, with 80% of the allegations related to claims from 1980 or earlier. Five of those claims come after 2002 when the Diocese instituted reforms and improved safeguards.
To read the statement, click here.
