Bankruptcy Court Gives Twin Cities Archdiocese until November to Submit Plan

By Jean Hopfensperger
Star Tribune
April 9, 2015

http://www.startribune.com/local/299198381.html

The Archdiocese of St. Paul and Minneapolis got more time to construct a financial reorganization plan Thursday when a U.S. Bankruptcy Court judge extended its deadline to Nov. 30.

Archdiocese attorneys argued that it needed more time to work with insurance carriers and to determine a more precise number of abuse claims. To file without that information would be counterproductive, they said.

“This gives us time to continue to pursue discussions with all parties,” said Richard Anderson, an attorney representing the archdiocese. “It insures that we won’t have to file something before it is fully vetted.”

The Twin Cities archdiocese has been in mediation with its creditors since filing for Chapter 11 bankruptcy Jan. 16. The bankruptcy came in response to an unprecedented wave of clergy abuse lawsuits filed since 2013, when Minnesota temporarily lifted its statute of limitations on older abuse cases.

Bankruptcy Judge Robert Kressel denied a church motion to pay its attorneys on a more frequent basis. Court documents say attorneys are earning about $473 an hour. The archdiocese argued that paying them every 120 days, as permitted by U.S. bankruptcy code, “imposes an undue burden,” and suggested 60-day pay periods.

“I do not see the burden,” said Kressel.

The archdiocese said it has made good progress in the bankruptcy proceedings. In a status report submitted to the court, it said it has reviewed about 140 claim notices by alleged clergy abuse survivors to date. It is also working to implement the child protection procedures announced in 2014 and is investigating priests identified as abusers or suspected of abuse.

It has encouraged all 187 parishes in the archdiocese to seek legal counsel and has met with parishes to discuss “potential resolution of parish claims.”

The archdiocese has produced about 150,000 pages of documents for its insurance carriers. It has more than 30 different policies dating from the 1940s and is working to locate policy information for missing time periods, the report said.

The archdiocese also has created a computer model to help calculate possible settlement costs per claim, per policy, court documents said.

Apart from claims by alleged victims of clergy sex abuse, the archdiocese is working with “numerous third parties” holding claims against the archdiocese and outlined potential methods for resolving those claims, the report said.

In March, the church asked the court to extend its deadline for filing a reorganization plan to Nov. 30.

Another key date in the bankruptcy process is April 16, when the court is expected to set a deadline for clergy abuse survivors — and others — to submit their claims.

Jean Hopfensperger • 612-673-4511