Sixty-eight people allegedly molested by Rev. James R. Porter agreed yesterday to drop their claims against the Fall River Diocese, apparently for at least $5 million. Their lawyer called the victims the largest group ever to settle a case of sexual abuse with the Catholic Church.

With several of the victims and members of their families looking on in tears, their attorney, Roderick MacLeish Jr., declared the settlement a victory for their efforts to redress wrongs done to them by the former priest, and a positive step by the diocese in dealing with allegations of sexual abuse.

MacLeish said the settlements prohibited the church and the victims from making public the amounts of the agreements. The amounts for each victim differed, according to the mediators involved in settling the case, and were determined by the seriousness of psychological trauma suffered.

One source familiar with the negotiations said the church would be paying approximately $5 million. A second source, who also asked not to be identified, said the total settlement amounted to "more than" $5 million.

Bishop Sean P. O'Malley, the recently installed head of the diocese, hailed the agreement as a "just settlement." Bishop O'Malley said he hoped that the agreement would bring "comfort and healing" to those "whose childhood was shadowed by the acts of a priest of the church . . . It is also my hope that from this tragic time for our church will come a sense of understanding and compassion for the victims of childhood sexual abuse."

During his seven years in the 1960s as a priest in parishes in the Fall River Diocese, Porter allegedly abused dozens of youths, most of them altar boys at churches in North Attleborough, Fall River and New Bedford.

Although Porter's actions became known to other priests and superiors at the diocese after two years, he was allowed to transfer to other parishes after seeking psychiatric treatment for his problems, according to Porter's diocesan personnel files obtained by the Globe.

The failure of Bishop James L. Connolly, then head of the Fall River Diocese, to force Porter out of the priesthood, despite knowing of his alleged molestation of children, formed the basis of the victims' claims against the church. By agreeing to the settlements, the victims have given up their right to sue the diocese for failing to restrict Porter's activities.

In its present situation, the diocese will have to pay the settlement from its own coffers. The two companies that had sold the diocese general liability insurance during the 1960s, Continental Insurance Co. and Boston-Old Colony Insurance Co., backed out of the negotiations in August, contending that the diocese had been so negligent in handling Porter that they should not have to cover the claims.

Thomas Hannigan Jr., who represents the diocese, said that it was suing the insurance companies to cover the claims. He declined to say how the diocese might otherwise raise the money to pay the settlements.

MacLeish and retired Superior Court Judge George N. Hurd of Milton, who acted as mediator in the case, praised Bishop O'Malley's role in the negotiations between the church, the victims and the teams of lawyers representing both sides.

They said that a turning point in the negotiations took place in late September when the bishop, who had been installed in Fall River in August, invited a small group of the victims to his chancery.

Without any of the lawyers present, Bishop O'Malley heard for the first time the victims tell their stories of how Porter had abused them and how the experience had damaged their lives.

Over the next five days, lawyers for the diocese and the victims sat with Hurd and went over the cases involving the 68 victims. They were "the toughest days of negotiations that I've ever seen," said Hurd.

From those talks, the diocese agreed to pay a total sum of money for all of the claims. During the next two months, Hurd met with each of the 68 people and came up with a settlement amount for each. Although Porter has claimed that he only molested young boys, about a dozen of the victims who gained settlements were women, said MacLeish's associate, Matthew McNamara.

The claimants were divided into four categories, depending on the seriousness of the trauma that they had suffered from the alleged abuse by Porter, Hurd said. All of the victims underwent extensive examination by two psychologists trained in childhood sexual abuse.

MacLeish, at the morning news conference announcing the settlement, said the psychologists had determined that all were telling the truth.

"It was quite striking how dramatically the lives of these people had been affected," said Dr. Stuart Grassian of Stoneham, who with Dr. John Daignault of Brockton had talked with each victim.

"For the most part, they all had come from stable and functionally secure homes. They were apple pie and ice cream kids who had gotten swept up in the compulsions of a priest," Grassian said.

"And we found, with one after another, they began to suffer what would become long-lasting psychological problems: loss of personal confidence, rebellion, loss of trust in elders or established institutions, divorce and financial. It was quite remarkable how their lives had suffered from these acts of abuse."

In addition to the settlement, it was also announced that the victims were establishing a nonprofit organization, Protect the Child Foundation, to help victims of sexual abuse come forward to confront their perpetrators, and to educate children on sexual abuse.

"We're all of us heroes, and every person who comes forward and faces victimization is a hero," said Frank Fitzpatrick, an alleged victim of Porter who first raised allegations against the former priest.

MacLeish said that the settlement represented the largest group of people allegedly abused by a priest who had settled their cases with the church. He said that the diocese did not try to restrict the size of the individual settlements by referring to the state law that limits to $20,000 the amount of money that a person can recover in a lawsuit against a charitable institution.

According to author Jason Berry, the Catholic Church worldwide has paid approximately $300 million in claims since 1985 to people who alleged they had been sexually abused as children and adolescents by priests.

The Vatican has yet to establish a churchwide policy for dealing with allegations of abuse, allowing individual parishes to decide whether they will pay for counseling for victims, appoint lay members to boards investigating allegations, or suspend the priests from active service while the investigations are taking place.

Meanwhile, the incoming head of the National Conference of Bishops, the ruling body for the Catholic Church in the United States, telephoned one of Porter's victims yesterday and said the bishops intended to discuss establishing a national policy for Catholic churches.

Dennis Gaboury, now of Baltimore, said he had been told by Archbishop William Keeler that a subcommittee of the bishops would contact him when it begins discussion.

In Minneapolis yesterday, Porter and his wife sat in a courtroom while jurors were picked to hear the criminal case against him. Porter is charged with molesting a teen-ager who was baby-sitting his four children. In Massachusetts, he is also facing multiple charges of sexual abuse in Bristol County.

Globe staff writer Linda Matchan contributed to this article from Minneapolis.

This story ran in the Boston Globe on 12/4/1992.