Gallup Diocese Clergy Abuse Settlement Approved

By Tom Corrigan
Wall Street Journal
June 22, 2016

http://blogs.wsj.com/bankruptcy/2016/06/22/gallup-diocese-clergy-abuse-settlement-approved/

The Roman Catholic Diocese of Gallup, N.M., on Tuesday won court approval of its plan to compensate clergy sexual abuse victims, paving the way for it to exit bankruptcy.

Following a hearing at the U.S. Bankruptcy Court in Albuquerque, N.M., Judge David Thuma signed off on the $25 million plan, which is largely funded by contributions from the diocese, insurance carriers, parishes and sales of the diocese’s property.

The bulk of the funds will be used to compensate victims, according to Susan Boswell, the diocese’s lawyer. Fifty-seven victims filed claims against the diocese, though not all will receive a payout because of prior settlements.

“This is, monetarily, a good resolution for the abuse victims,” Judge Thuma said. “I think it’s more money that any of us thought could be raised in this case.”

In return for victim compensation, the plan provides legal protections for the diocese and the other contributors that will shield them from future lawsuits tied to past abuse.

Victims who voted on the plan supported it unanimously, court papers show.

To date, 15 Catholic dioceses and religious orders have turned to bankruptcy to workout similar plans when the financial burden of mounting sexual-abuse allegations becomes overwhelming.

Ms. Boswell says she hopes to close the case “as soon as we can,” to cut down on lingering legal bills, which are expected to total about $3.5 million for a case that has lasted more than 2 1/2 years. Victims’ claims are subject to a review by a court-appointed expert, who ultimately determines how much money they receive.

James Stang, a lawyer who has helped victims negotiate settlements in many diocesan bankruptcies, told the judge Tuesday that the monetary compensation in the diocese’s bankruptcy plan was “only a very small piece of the puzzle.”

“These folks will live with this experience for the rest of their lives,” he said. “That is something that our system cannot begin to address.”

The diocese agreed to non-monetary concessions including requirements that it list prominently the names of priests with “credible allegations of abuse” on its website and that it refer to all victims as “survivors.” The terms also call for the bishop to send a personal letter of apology to all victims and to hold a private conference with victims who request a meeting.

The Diocese of Gallup, which serves about 60,000 parishioners in New Mexico, Arizona and several Native American reservations, filed for chapter 11 protection in November 2013. According to Ms. Boswell, Gallup is one of the poorest dioceses in the country.

During Tuesday’s hearing, the Rev. James Wall—the Bishop of Gallup—apologized to victims and thanked them coming forward with their claims, acknowledging a difficult process that can takes decades. The diocese’s bankruptcy plan establishes a process to compensate victims who have not yet come forward.

“Bad people, bad men, committed bad and sinful acts against good people, and there’s no excuse for that,” he said. “I want to do all that I can do to make sure something like this never happens again.”

One unnamed victim who spoke in court Tuesday called the suffering she continues to experience as a result of her abuse “irreparable and life-long.” She said she accepted the bishop’s apology, though she said the diocese had not gone far enough in publicly releasing internal records on her alleged abuser.

“I’m still waiting,” she said.