The Roman Catholic Diocese of Burlington filed for bankruptcy on Monday in a bid to resolve more than two dozen sexual abuse lawsuits.
The diocese, which currently faces 31 lawsuits, doesn’t have insurance anymore to cover these claims, and has depleted assets, said Bishop John McDermott in an affidavit filed in federal bankruptcy court on Monday. In the filing, McDermott wrote that a large jury settlement in any of these cases would leave the diocese unable to compensate other survivors.
“The Diocese determined that reorganization under Chapter 11 is the only way to fairly and equitably fulfill the Diocese’s obligations to all survivors of sexual abuse,” McDermott said in the affidavit.
Chapter 11 bankruptcy, often called “reorganization” bankruptcy, allows an organization to continue to operate and propose a plan to pay creditors, in this case survivors of sexual abuse, over time.
The Vermont diocese began facing lawsuits in the early 2000s after reporting by the Boston Globe revealed widespread sexual abuse by Catholic priests and how the church covered up the problem.
Since 2006, the Burlington diocese has paid more than $30 million to settle abuse allegations, and in 2019 the church released the names of 40 priests accused of sexually abusing children in Vermont since the 1950s. The Vermont Legislature, also in 2019, removed the statute of limitations to bring civil cases for allegations of childhood sexual abuse, which led to a slew of new lawsuits.
Some attorneys representing Vermonters with abuse allegations, like attorney Jessica Arbour, are concerned that the bankruptcy proceedings will allow the diocese to avoid accountability and remove survivors from the process.
“Their stories don't become known to the people who are making decisions about their futures, about their settlements, about the value of their case,” Arbour said during an interview on Tuesday.
The process will likely result in smaller settlement amounts, and there will eventually be a “bar date” that will prevent anyone else from filing claims of sexual abuse against the diocese once that deadline has passed, Arbour said.
A spokesperson for the diocese declined to comment on Tuesday and said they’d issue a statement later this week. McDermott, in his filing, said the bankruptcy case wasn’t an attempt to avoid accountability.
“The Diocese has been, and continues to be, committed to addressing the wrongs perpetrated and fairly compensating survivors,” McDermott said.
According to McDermott’s affidavit, the diocese employs 54 people and owns eight properties. The 63 parishes in Vermont each hold their own assets in individual trusts, which means they’re not under the fiscal or operating control of the diocese. VTDigger reported that this move was done in 2006 to shield an estimated $500 million in property assets from priest abuse settlements.
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