NEW YORK (NY)
WGRZ-TV [Buffalo NY]
August 23, 2024
By Sean Mickey
As the future of six Catholic dioceses in New York remain clouded by bankruptcies brought on by thousands of lawsuits from people who say they were sexually abused as children by clergy, a statewide settlement that would tap into a multi-billion-dollar revenue source appears to be under consideration.
Such a “global” settlement – which would likely need to be approved by Cardinal Timothy M. Dolan, the archbishop of New York, and possibly the state attorney general – could help resolve the bankruptcy proceedings that have frustrated aging survivors in Buffalo for more than four years because of their slow pace.
Documents filed in U.S. Bankruptcy Court that were obtained and analyzed by 2 On Your Side Investigates make clear that a statewide settlement with the use of proceeds from the $3.75 billion sale of Fidelis Care is on the table. The Catholic bishops of New York used proceeds from the 2018 sale of Fidelis to create the Mother Cabrini Health Foundation, a nonprofit with a stated mission of providing care to low-income and vulnerable populations.
Fidelis, a highly successful insurance company, was led by the bishops of the state’s eight dioceses who had authority over mergers, dissolutions, acquisition, and operation.
The sale took place less than one year before the State Legislature passed the Child Victims Act, which allowed alleged survivors of child sexual abuse to file suit against abusers and organizations that harbored them. New York’s Catholic bishops spent millions unsuccessfully lobbying against the CVA , which former Gov. Andrew M. Cuomo signed into law in 2019.
Attorney Jeff Anderson, who represents hundreds of alleged survivors of abuse in Buffalo and across the state, questioned the sale. He claimed in 2021 that the transfer into an independent foundation was part of a playbook to shield assets from impending legal and financial exposure.
According to a report from the Albany Times Union, the assets of the fund are not considered the dioceses’ because they are not the legal owner of the nonprofit.
“Neither the Archdiocese of New York, nor any of the other dioceses of New York, owned Fidelis or controlled its assets, and the decision to sell Fidelis to Centene Corporation was totally and completely unrelated to the (Child Victims Act) in any way,” a spokesperson for the Archdiocese of New York told the Times Union in 2021.
But documents filed Thursday in federal bankruptcy court show the use of the fund has been discussed in mediated settlement negotiations.
Diocesan lawyers statewide have discussed a global settlement using the fund since at least May, the documents state. A proposed memorandum of understanding was drafted that included the use of the funds towards the resolution of Child Victims Act claims, according to the records.
An August invoice from diocesan bankruptcy attorneys Bond, Schoeneck & King states that the firm billed the diocese after lawyers “received, reviewed and responded to correspondence amongst general counsel for Dioceses of New York State relative to global CVA proposal with Cabrini Foundation.”
The global settlement is mentioned four additional times in the invoice, which at one point describes the proposal as coming from an unnamed “plaintiffs’ lawyer” who likely represents abuse survivors.
2 On Your Side questioned Diocese of Buffalo Chief Operating Officer Richard Suchan about the fund earlier this month in our series “Faith and Fallout.”
“You can’t just tap into that without receiving prerequisite approval,” said Suchan. He added that the move would need New York Attorney General Letitia James’ approval.
The Diocese of Buffalo did not immediately respond to a request for comment. Attorneys representing survivors contacted by 2 On Your Side declined to comment on potential negotiations regarding the fund, as they are prevented by a non-disclosure agreement.