Settlement reached between St Paul and Minneapolis Archdiocese and sex abuse victims

Susie Jones
May 31, 2018 - 12:46 pm

The Archdiocese of St. Paul and Minneapolis has reached a settlement in its bankruptcy case with more than 400 sexual abuse victims, an attorney said Thursday.

Victims' attorney Jeff Anderson said he would hold a news conference in the afternoon to discuss a "consensual bankruptcy reorganization plan" between the victims and the archdiocese. His statement didn't put a dollar figure on the settlement.

A spokesman for the archdiocese confirmed that a settlement was reached. The archdiocese also scheduled a news conference for Thursday afternoon.

The Minnesota Legislature in 2013 opened a three-year window in the statute of limitations that allowed victims of prior abuse to sue for damages. That resulted in hundreds of claims being filed against the archdiocese and led it to file for bankruptcy in 2015.

The bankruptcy case proceeded slowly as attorneys argued over how much money the archdiocese should have to pay. The archdiocese reported its net worth was $45 million. But attorneys for the victims maintained that the archdiocese's true worth was over $1 billion, counting assets of its 187 Roman Catholic parishes, as well as schools, cemeteries and other church-related entities. Victims' attorneys said those assets should be used to make more money available for victims.

A federal appeals court last month affirmed a decision by U.S. Bankruptcy Judge Robert Kressel in 2016 that the parishes and other nonprofit entities were independent, meaning their assets could not be tapped in the bankruptcy case. Kressel had, in December, rejected competing reorganization plans filed by the archdiocese and a creditors' committee led by Anderson and ordered both sides back into mediation.

At least 15 Catholic dioceses across the country have filed for bankruptcy, including three in Minnesota, as they sought to protect themselves from growing claims of sexual abuse by clergy members. A fourth Minnesota diocese, St. Cloud, announced its intention to file in February but didn't immediately set a date.