Gregory Aymond, archbishop of New Orleans, said the bankruptcy settlement would lead to healing for survivors and the church.
A proposed $180 million settlement agreement between a creditors committee and the Archdiocese of New Orleans may signal the winding down of five years of litigation, despite objections by some sexual abuse survivors.
The proposed agreement amounting to $179.2 million was announced last month to settle ongoing bankruptcy proceedings involving the archdiocese and to compensate survivors of sexual abuse by priests. Although some attorneys involved in the negotiations say the settlement was negotiated in good faith by a committee authorized to represent survivors’ interests, one survivors group said that the settlement fails to deliver justice and that survivors deserve larger monetary compensation.
“The best legal settlements offer survivors a sense of closure and justice,” a statement from the Chicago-based Survivors Network of those Abused by Priests (SNAP) says. “Unfortunately, the proposed bankruptcy settlement from the Archdiocese of New Orleans offers neither.”
SNAP characterized the bankruptcy proceedings as an effort to protect the religious institution rather than a serious reconciliation with survivors. The process was advanced by “church-friendly judges, politicians and business leaders” and continues the status quo, according to SNAP.
“No amount of money can ever make up for the trauma of being raped as a child by a trusted religious figure,” SNAP Board Treasurer Dan McNevin said in a prepared statement. “It cannot restore what was stolen by the church. Yet within the constraints of bankruptcy court, financial compensation is the only available measure of justice. Survivors deserve better – and they deserve far more.”
But attorney Kristi Schubert of the Lamothe Law Firm in New Orleans, which has represented abuse survivors, said the agreement includes new policies to improve the review of abuse claims in the future, including a Survivors Bill of Rights.
“They also contain a requirement that the archdiocese publish a large volume of abuse-related records online – available for anyone and everyone to see,” Schubert told the Louisiana Record. “... The archdiocese has agreed to implement them if the bankruptcy plan is approved. But if the archdiocese’s bankruptcy case gets dismissed, the archdiocese is under no obligation to follow these plans.”
In the wake of the memorandum of understanding to settle the bankruptcy proceedings, Archbishop of New Orleans Gregory Aymond expressed hope that the agreement would end the years of legal disputes.
“I am grateful to God for all who have worked to reach this agreement and that we may look to the future towards a path to healing for survivors and for our local church in the Archdiocese of New Orleans,” Aymond said in a statement.
The law firm Pachulski, Stang, Ziehl & Jones LLP reported that the tentative settlement would be subject to the approval of the federal bankruptcy court and other archdiocese creditors.
“Under this proposed resolution, these parties will settle sex abuse claims by paying $179.2 million into a trust for the benefit of survivors – more than 20 times the archdiocese’s initial settlement estimate when its bankruptcy case was filed in May 2020,” the law firm said.
In addition to the $179.2 million, survivors would receive additional funds through the sale of archdiocese properties and from recoveries from the archdiocese’s remaining insurer that chose not to settle. Average payouts would be approximately $300,000, according to the law firm.
““The Committee (of Unsecured Creditors for the Archdiocese of New Orleans) delivered on its commitment to provide survivors a settlement that provides fair compensation, transparency and, importantly, unprecedented child-protection measures,” Jim Stang of Pachulski, Stang, Ziehl & Jones said. “We look forward to working with all survivors to bring this five-year bankruptcy case to an acceptable resolution.”
