Diocese of Camden Announces Second Amended Chapter 11 Disclosure Statement Totaling $90 Million
Funding will go to survivors of clergy sex abuse
CAMDEN — On October 1, 2020, the Diocese of Camden filed for reorganization under Chapter 11 of the United States Bankruptcy Code. This process is one of the many paths the diocese has undertaken during the past 30-plus years to address the tragedy of clergy sex abuse and its traumatic impact on victims.
The Chapter 11 process ensures the ability to provide ALL survivors fair and equitable resources, so as to avoid the far worse scenario where a race to the courthouse occurs and the first survivors may receive funds, but subsequent survivors would be left with little or nothing after years of protracted litigation.
With the survivors’ benefit as the Diocese’s primary concern, today by filing a Second Amended Disclosure Statement the Diocese moved forward with its plan to distribute to survivors $90 million to resolve approximately 300 claims. These claims have been carefully reviewed by the diocese, the Tort Claimants Committee and diocesan insurers. The Diocese believes this settlement is fair and equitable and no independent analysis suggests otherwise.
The $90 million dollars, an amount determined through the extensive negotiation process and analysis of previous clergy sex abuse cases, is composed of $30 million cash, available on day one, and additional payments of $10 million on the first, second and third anniversaries of plan confirmation. While the bulk of this dedicated survivors trust will be funded from the Diocese, the parishes within the Diocese of Camden will also contribute a portion.
The additional $30 million comes from diocesan insurers. As part of the Chapter 11 process, the Diocese engaged with all insurance companies who provided diocesan insurance coverage to obtain resources for survivors.
The total fund of $90 million is at the high end of all diocesan Chapter 11 cases throughout the United States.
In addition to the $90 million in funds, the Diocese will continue, as it has for more than 20 years, to implement every available safeguard to ensure that clergy abuse never occurs again. While no one can legitimately dispute the level of scrutiny that now exists within the Diocese of Camden, the Diocese must remain vigilant for any future abuse.
Where once there was blindness to this form of abuse, situations like this are no longer handled in any form but transparently, both through education to prevent abuse and immediate law enforcement notification should a future incident of abuse ever be reported. The Diocese’s commitment remains unwavering to the youth and vulnerable people’s protection policies enacted and improved upon over more than two decades.
The Chapter 11 process has been extensive, transparent and arduous, as it should be, primarily involving settlement mediation with the Tort Claimants Committee, via in-person and virtual meetings, conference calls and emails. It has also included the appearance of Bishop Dennis Sullivan, as well as many of the diocesan administrative leaders, before United States Bankruptcy Judge Jerrold N. Poslusny, Jr. and the Court designated mediator retired United States District Court Chief Judge Jose L. Linares.
No effort to reach a settlement with the Tort Committee’s attorneys was overlooked and no interaction rebuffed by any diocesan representative.
The mediation process began in earnest on July 28-29, 2021 and continued through August, September, October and November 2021, featuring multiple sessions, entailing hundreds of hours, occurring under the watchful eye of Judge Linares.
Unfortunately, the Tort Claimants Committee declined to continue those mediation sessions and instead refused to consider any of the Diocese’s efforts to come to an agreement.
On January 12, 2022, with the consent of the Tort Claimants Committee and at the direction of Bankruptcy Judge Poslusny, a 13-hour session occurred in Mt. Laurel. Judge Poslusny attended with the consent of the survivors. Everyone listened intently and the Diocese attempted to finalize a global settlement and final disposition of Chapter 11 proceedings. Again, the session was not successful.
On January 18, 2022, an additional 10-hour mediation session was held with the insurers at the Mediator’s office in Newark. Judge Poslusny and Judge Linares attended. It resulted in a successful mediation where insurers agreed to finalize their contribution of $30 million.
The Chapter 11 process has been long and often painful. Similarly, the proposed resolution will be difficult and will cause concern in many parishioners due to its size. However, it is necessary. While this settlement may cause the diocese some restriction, it ultimately allows parishes, schools and ministries within the Diocese to continue their important work, which is a credit to all those involved in the bankruptcy proceedings.
As the Diocese has since the clergy sex abuse scandal became fully know, Bishop Sullivan asks that all continue to pray for peace for victims and their families and that the Catholic Church and its leaders remain committed to the protection of youth and vulnerable peoples.