Judge Puts Milwaukee Archdiocese Settlement to a Vote

By Tom Corrigan
Wall Street Journal
October 1, 2015

http://blogs.wsj.com/bankruptcy/2015/09/30/judge-puts-milwaukee-archdiocese-settlement-to-a-vote/

Milwaukee Archbishop Jerome Listecki in 2011 Morry Gash/Associated Press

Clergy sexual abuse victims will soon begin voting on a $21 million settlement, which the Roman Catholic Archdiocese of Milwaukee hopes will put its nearly five-year-old chapter 11 case to rest.

Judge Susan Kelley of the U.S. Bankruptcy Court in Milwaukee on Wednesday approved a plain-language version of the archdiocese’s chapter 11 reorganization plan, at the heart of which is the settlement. Now, the plan will be sent out for a vote by victims and other creditors. Judge Kelley will consider the plan itself at a Nov. 9 hearing.

The terms of the settlement, announced in August, divide about 580 abuse victims into several groups. About 350 victims will share the bulk of the $21 million settlement, and another 105 victims will each receive $2,000, court papers show. The remaining 123 victims, who had previously settled with the archdiocese or otherwise did not qualify for the settlement, won’t receive any monetary compensation.

The settlement also provides a total of $250,000 for victims who come forward in the future, plus $500,000 to provide therapy for victims in any of the three groups.

Non-monetary terms built into the settlement include requirements that the archdiocese publish the names of allegedly abusive priests on its website and that the archbishop send a personal letter of apology to any victim who requests it.

In exchange, the archdiocese, which covers about 4,800 square miles in southeast Wisconsin and serves about 575,000 parishioners, will receive releases from liability related to past abuse, as will its parishes and schools.

The settlement has drawn criticism from some victims and their advocates, who say the compensation is not enough and that the deal does little to address lingering concerns about child safety.

“Survivors are concerned that these crucial issues if they remain unaddressed will make the hope of ‘healing and resolution,’ which Archbishop Jerome Listecki promised was the reason the archdiocese filed into bankruptcy, unattainable,” Peter Isely, a founding member of the Survivors Network of those Abused by Priests, or SNAP, said shortly after the settlement was announced.

The current deal was reached in the face of protracted litigation and soaring legal costs. In absence of the settlement, the archdiocese said in court papers that the cost of continued litigation could have reached more than $33 million.

As of July 31, the total fees and expenses incurred by the lawyers and other professionals in the bankruptcy had reached about $20 million, according to court papers. Future charges have been capped at $1.25 million, bringing the total bill just shy of what will be set aside to compensate victims.

The abuse scandal has cost dioceses and other Catholic institutions nationwide nearly $3 billion since 2004, according to a recent report issued by the U.S. Conference of Catholic Bishops. Since 2004, 14 Catholic dioceses and religious orders—most recently, the Archdiocese of St. Paul and Minneapolis—have turned to chapter 11 to address the mounting abuse claims against their priests and other personnel.