WATCH: Roman Catholic Diocese of Albany files for bankruptcy
ALBANY, N.Y. (NEWS10) -- On March 15, the Roman Catholic Diocese of Albany filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code. "A chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time," according to the Federal Judiciary. Watch the news conference above at 2 p.m.
Parishes and Catholic Schools of the Diocese aren't a part of the filing, as they are separately incorporated under New York State’s Religious Corporations Law, according to the diocese. Even so, it is not clear how this filing could affect ongoing deliberations with the pensioners of St. Clare's.
The announcement said that under the Chapter 11 filing, legal actions against the diocese would stop. That would let the diocese determine available assets, work with its insurers, and develop a plan to negotiate settlements with victims and survivors of sexual abuse, in addition to other creditors. Services will continue during the process, and the timeline for reorganization could last several years.
“We maintain global mediation would have provided the most equitable distribution of the Diocese’s limited financial resources,” said Bishop Edward B. Scharfenberger, Bishop of Albany, in in the written announcement. “As more Child Victims Act cases reached large settlements, our limited self-insurance funds which have been paying those settlements, have been depleted. The Chapter 11 filing is the best way, at this point, to ensure that all Victim/Survivors with pending CVA litigation will receive some compensation. The decision to file was not arrived at easily and I know it may cause pain and suffering, but we, as a Church, can get through this and grow stronger together.”
“Sex abuse is a blight on our society that affects and harms so many innocent people,” said Bishop Scharfenberger. “As a Church and as a community of faith, we recognize that the Victim/Survivors are our sons and daughters, our brothers and sisters, and all of us, without exception, must find ways to assist them in their recovery.”
Jeff Anderson, an attorney representing over 190 survivors suing the diocese, said, "We urge everyone to see the Diocese’s strategy for what it is: chicanery designed to perpetuate a $600 million corporation’s pattern of decadence, deception, and denial."