Archdiocese: Crosier plan objection aims to secure compensation for abuse claimants

| March 16, 2018 | 0 Comments

Leaders of the Archdiocese of St. Paul and Minneapolis said its legal objection filed against the Crosier Fathers and Brothers’ plan for reorganization aims to help victims/survivors of clergy sex abuse, not stymie the Crosiers’ reorganization process.

“The archdiocese is committed to maximizing its resources available to compensate victims and to reach a prompt consensual result in its bankruptcy case through the mediation ordered by Judge [Robert] Kressel. The availability and value of its insurance is at the heart of these resources,” said Thomas Abood, chairman of the archdiocese’s reorganization task force, in a March 15 statement.

“The archdiocese filed its objection in the related Crosier matter to ensure the preservation of insurance rights for the benefit of the victim creditors in its case,” he added. “The archdiocese fully expects that its filing, as well as the similar filing by the Crosiers in the archdiocese case, will be resolved in a way that does not delay confirmation of a plan in either case.”

Attorneys for the archdiocese filed the objection with the U.S. Bankruptcy Court March 14 in order to have the plan amended in a way that would preserve the compensation obligations of insurers affected by both the Crosiers’ and archdiocese’s reorganization efforts. The Crosiers and the archdiocese are among Catholic entities in Minnesota that separately filed for reorganization following the 2013 lifting of a statute of limitations by the Minnesota State Legislature, which ushered in a wave of historic sexual abuse claims.

According to news reports, 67 people filed sexual abuse claims against the Crosiers. More than 400 people filed claims against the archdiocese. Some of the claims overlap, as claimants alleged abuse by Crosiers serving in the archdiocese at the time. The Crosiers’ plan offers a $25.5 million settlement, which includes insurance settlements. The plan was slated for confirmation next week.

In a March 15 press conference, Mike Finnegan, an attorney at Jeff Anderson and Associates in St. Paul who represents abuse claimants, accused the archdiocese of trying to “block” the Crosiers’ settlement, calling the action “outrageous” and “hypocritical.”

Abood contested the accusation, saying that “the mechanical and procedural nature of this objection is well known” to the victims’ legal counsel.

“Anyone who has studied other diocesan bankruptcies should know that a failure to file an objection of this sort can sadly result in the loss to creditors [sexual abuse claimants] of the benefits of diocesan insurance coverage,” Abood said in the statement. “It doesn’t help the archdiocese; it only helps its creditors. Rather than being a self-serving hardball legal tactic, yesterday’s filing is completely consistent with the archdiocese’s sincere commitment to putting survivors first.”

He added: “The archdiocese will continue to focus its efforts on the active mediation and reaching a consensual plan that benefits victims as soon as possible.”

According to court filings, the archdiocese and attorneys representing abuse claimants return to mediation next week as the archdiocese aims to reach its own plan for reorganization, after Judge Kressel denied in December two competing plans for reorganization — one created by the archdiocese, the other created by a committee representing abuse claimants.

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Category: Local News