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	Appeal Provision Could Derail Catholic Diocese of Wilmington Bankruptcy Settlement By Beth Miller News Journal May 25, 2011 http://www.delawareonline.com/article/20110525/NEWS01/105250352/Appeal-provision-could-derail-diocese-bankruptcy-settlement Ballots and details of the Catholic Diocese of Wilmington's Chapter 11 bankruptcy reorganization plan will be in the mail next week to its creditors, including about 150 survivors of clergy abuse, more than 1,300 lay employees, banks and others with pending claims. And a date – July 8 – has been set to work through final objections and confirm a final plan. But a monkey wrench may be in the mix, too – a problem that could derail the negotiations and delay settlement payments for more than a year, according to Thomas Neuberger, the lawyer whose firm has represented the majority of sexual abuse survivors in scores of cases against the diocese. Neuberger said the $77 million settlement survivors reached with the diocese in February is in jeopardy. Under the terms of that agreement, which would put an end to more than 100 lawsuits pending against the diocese, payment would be made to a survivors' trust fund 60 days after the diocese's Chapter 11 plan is confirmed in court. The earliest that could occur, if all goes smoothly, would be about mid-September. But, Neuberger said, the diocese's plan would withhold the money until all appeals have been resolved. If lay employees of the diocese appeal the reorganization plan, those payments could be delayed for a year or more while the appeals process unfolds. Neuberger said he will ask the diocese to remove that provision from its reorganization plan, ensuring that settlement money will be awarded within the negotiated 60-day period. Otherwise, he said, he may advise the 99 survivors he represents to vote against the settlement plan.쇓 Diocese attorney Tony Flynn said the diocese has no interest in delaying the process, and said its plan does not block payment if an appeal arises. He said only an order from Judge Christopher Sontchi could put a stay on the payment. Neuberger and other attorneys representing survivors are not inclined to add a day more to their wait for reparations, saying survivors have waited long enough -- some for decades. One claimant, John Dougherty of Las Vegas, who sued for abuse by the Rev. Edward Carley, died March 12 after a long battle with leukemia. Other survivors are ill. But Donald Detweiler, attorney for more than 1,300 lay employees who have a claim on pension benefits they have earned in the diocese's schools and parishes and other programs, said the terms of that settlement will not leave enough in diocesan coffers to compensate the large number of employees expected to draw vested pension benefits. Lay employees and the diocese will go to mediation next week, with Judge Kevin Gross presiding, in an effort to resolve their differences. The lay employees say the diocese reached its settlement with abuse survivors without factoring in severely underfunded pension obligations, which Detweiler said are worth about $60 million. The diocese has proposed to add $5 million to the pensioners' $4.8 million fund to resolve pensioner claims, and then add at least $2 million a year to the pension fund in years to come. But the lay employees doubt such an offer can cover future benefits. In recent filings, the diocese disclosed more specifically where it would get $57.8 million of the $77.2 million it needs to satisfy survivor claims. Those non-debtor sources include: » $53.4 million from the Catholic Diocese Foundation » $3.3 million from Catholic Cemeteries Inc. » $3.1 million from the Children's Home (closed) » $2.1 million from Seton Villa Inc. (closed) » $1.5 million from Siena Hall Inc. (closed) From the parishes, the diocese would receive: » $500,000 each from St. John the Beloved and St. Thomas the Apostle; $300,000 from St. Elizabeth; $250,000 from Corpus Christi; $200,000 each from Immaculate Heart of Mary and St. Edmond; $150,000 from St. Joseph on the Brandywine; and $100,000 from St. Peter the Apostle. Another $15.5 million would come from insurance policies. Contact Beth Miller at 324-2784 or bmiller@delawareonline.com.
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