Archdiocese Asks Bankruptcy Court for a Lot More Time to Reorganize

Sentry Review
March 28, 2015

http://www.sentryreview.com/breaking/archdiocese-asks-bankruptcy-court-for-a-lot-more-time-to-reorganize-h2585.html

The Archdiocese of St. Paul and Minneapolis has asked a federal bankruptcy court to extend its deadline for filing a reorganization strategy to Nov. 30.

U.S. bankruptcy code offers the archdiocese exclusive rights to propose a reorganization program inside 120 days of petitioning for Chapter 11 bankruptcy, which it did on Jan. 16. The court can extend that &ldquoexclusivity period&rdquo for very good cause.

The archdiocese argued that it needed far more time to perform with insurance coverage carriers to figure out liability. It entered into mediation with the carriers, abuse victim creditors and other creditors shortly right after filing for Chapter 11. The bankruptcy came in response to an unprecedented wave of clergy abuse lawsuits filed given that 2013.

&ldquoThere are a number of complicated concerns to be resolved prior to completion of the mediation method,&rdquo according to the notice filed this week. &ldquoIn specific, it is imperative that the Archdiocese and the Committee have enough time to negotiate with the liability insurance coverage carriers for contribution toward a complete and international settlement and consensual plan of reorganization.

&ldquoIt is hugely unlikely that the negotiation of these challenges will be completed in time to permit the Archdiocese to file its plan within 120 days of the petition date.&rdquo

The motion is slated to be heard April 9 in U.S. Bankruptcy Court. If approved, the extension would create a Jan. 29, 2016, deadline for the archdiocese to solicit confirmation of its exclusive program. After that date, plans could be submitted by other parties.

The archdiocese plans to file a motion to establish a bar date, a deadline for people today or firms owed cash to notify the court, in April.

A final settlement can&rsquot be completed till &ldquothe complete universe of claims is known, the parties have time and adequate info to evaluate the claims, and the parties have time to evaluate and negotiate their settlement positions,&rdquo the motion stated.

Jeff Anderson, the lawyer representing most of the clergy abuse victims who are creditors in the bankruptcy proceeding, mentioned he had no issues about the archdiocese&rsquos request. He known as it an administrative move to assist handle the bankruptcy.

Jean Hopfensperger &bull 612-673-4511

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