Diocesan financial resources are limited -- they are not adequate to compensate the victims for the amounts demanded. Because many of these events happened 30-50 years ago, insurance coverage is either unclear or perhaps non-existent. We are trying to settle these cases fairly and honorably. We do not know if we can accomplish settlement in this mediation.

In speaking with the people who have come forward, we have also learned that, tragically, there are many more who have also been harmed, primarily by three former priests. It is important to bring healing to those who have been harmed.

It is also important to bring closure to this tragedy -- for the victims and for the Diocese. Bringing closure may be impossible in the context of present and future litigation. The Diocese will make every effort to settle these cases, but you must know that Chapter 11 bankruptcy may be the only way to fairly and honorably compensate all victims -- those who have already come forward and those who have not yet done so. Two dioceses -- Portland (Oregon) and Tucson -- have taken this path. Both dioceses paid settlements in the millions to victims of abuse. After the settlements, numerous additional victims came forward, but the dioceses no longer had the resources to compensate them. Both dioceses have said they wished they had taken bankruptcy in the first place.

Compensation levels should not be based on a "first-come, first-served" basis. The Diocese wants to fairly compensate all victims -- not just the first ones to come forward.

If bankruptcy becomes necessary -- and we hope it does not -- here are some things you should know:
1. The Diocese will remain in operation.
2. As part of a plan to be presented to the bankruptcy court, the Diocese would scale down its operations.
3. St. Vincent's Center, an asset of the Diocese, may be sold and the Diocese would move its headquarters.
4. The assets of the Diocese would be submitted to the court as part of a plan of distribution over a period of years.
5. Because the parishes are separate corporations, we believe that they are not assets of the Diocese and should not be taken in the bankruptcy.

But you must understand that the attorneys for the claimants may dispute this. Be sure your corporate records are in good order. They may claim, as they have elsewhere, that the parish assets are available to them.