Catholic Church to Pay $3.75m in Kelly Claim

Union Democrat
April 23, 2012

http://www.uniondemocrat.com/News/Local-News/Catholic-church-to-pay-375M-in-Kelly-clai

The Catholic Diocese of Stockton, which includes parishes in Tuolumne and Calaveras counties, has agreed to settle for $3.75 million a legal claim by a Fairfax man who argued former priest Michael Kelly molested him as a youth.

In exchange for the settlement, the plaintiff has agreed to drop his case against the diocese and Kelly, according to a statement from Bishop Stephen Blaire.

"The settlement brings an end to litigation that began more than 4 1/2 years ago and that has occupied a great deal of time and focus," he said. "We respect the right of everyone to have their day in court and we abide by the decisions that were made."

The settlement was the latest development in a week full of surprises in the case.

Last Monday, it was revealed Kelly had fled to his homeland, Ireland, on the eve of his scheduled testimony in the second phase of the trial in San Joaquin County Superior Court.

The second phase focused on whether the diocese played a role in covering up Kelly's misbehavior.

In the first phase of the trial, Kelly on April 6 was found liable for sexually abusing the man when he was an altar boy at Stockton's Church of the Annunciation.

Kelly claims he left the country because of health problems.

The flight also coincided with a Calaveras County Sheriff's Department investigation into allegations Kelly molested at least one youth in Calaveras County while leading St. Andrew's Church in San Andreas between 2000 and 2002.

The alleged victim was brought to the county's attention by a Newport Beach law firm that is also representing the Stockton victim.

Sheriff's investigators last week said they had received several reports from alleged victims, including at least one from Tuolumne County.

The diocese, in settling, made no overt admission of wrongdoing.

The plaintiff's attorney, John Manly, however, said the settlement spoke for itself.

"When someone pays $3.75 million ... it's because they did something wrong," he said.

While the civil case is over, Manly said, his client, an airline pilot and military veteran, is still urging the state Attorney General and San Joaquin County District Attorney to investigate whether there was any criminal wrongdoing by the diocese.

An investigation would examine "how he was allowed to stay in the ministry for 40 years when he was a clear and present danger," Manly said. "The evidence at trial showed they knew he was a pedophile and they ignored it."

Blaire said in an interview Friday that Kelly's flight was a factor in the decision to settle the case, which the judge had encouraged the diocese to consider.

"I think it certainly changed the environment because he was not there," Blaire said. "He was supposed to testify and did not. How that affected the jurors, I don't know."

Blaire indicated the diocese would not pay for Kelly's defense if criminal charges in Calaveras County are filed against him.

"We stood behind him and defended him for four-and-a-half years through these accusations in the civil trial," Blaire said. "And now if he were to be charged criminally, that's his responsibility."

The Stockton settlement is the second major payout by the church in relation to parishioner abuse by priests.

In 1998, the diocese was ordered to pay a pair of Turlock brothers $30 million in a landmark legal settlement, which was later reduced to $7 million.

John and James Howard said they were molested several times between 1978 and 1991 while former priest Oliver O'Grady was at Sacred Heart Church in Turlock.

O'Grady was sentenced to 14 years in prison in a criminal case and was later deported to Ireland, where he lives today.

The O'Grady case, among others things, showed the diocese and a succession of bishops were aware of O'Grady's activities as early as 1976 and addressed the matter by assigning him to counseling and shuffling him to different churches, including St. Andrew's in San Andreas.

Insurance will pay for $2 million of the settlement in the civil case involving Kelly, but the rest will come out of Stockton Diocese reserves, Blaire said.

"The truth is that it will have some serious effects on the operations of the diocese," he said.

Since the mid-1980s, the Catholic Church and the diocese have implemented many added precautionary measures to prevent similar situations, and Blaire said those procedures will likely be examined following the settlement.

"When we have a situation like the one we've just been through, we always take a fresh look at everything and see if there's anywhere we can make further improvements," he said.