San Diego Diocese may file for bankruptcy amid abuse claims


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St. Louis, Mo., Feb 14, 2023 / 05:00 am (CNA).

Cardinal Robert McElroy of San Diego announced last week that the diocese is considering declaring bankruptcy due to the “staggering” legal costs of responding to 400 new lawsuits brought during a three-year statewide expansion of the statute of limitations for child abuse cases.

“Bankruptcy would provide a pathway for ensuring that the assets of the diocese will be used equitably to compensate all victims of sexual abuse while continuing the ministries of the Church for faith formation, pastoral life, and outreach to the poor and the marginalized,” McElroy wrote a Feb. 10 letter to parishioners in the diocese.

“The sexual abuse of minors by priests and the way it was handled in the life of the Church constitute the greatest sin of our Church in the last century. We must and will continue to protect minors with ever deeper vigor, provide healing resources to those who have been abused, and use our diocesan assets to compensate those who were victimized. And we will never forget the harm that we have done.”

At issue, McElroy said, is a mounting number of abuse claims filed under a three-year window opened by California’s governor, which began in 2020 and expired on Dec. 31, 2022. Some of the new abuse claims brought to the diocese date back 75 years, the cardinal wrote.

California Gov. Gavin Newsom signed into law in 2019 a measure called AB 218, which extended the statute of limitations for childhood sex abuse victims. The law allows civil claims of childhood sexual abuse to be filed by victims until age 40 or five years after discovering the damages from the abuse. Previously, claims had to be filed by age 26 or within three years of discovering damages from the abuse.

“As a result of this change in the law, the Diocese of San Diego has received approximately 400 suits seeking monetary damages for alleged acts of sexual abuse by priests, religious, and laity in the diocese,” McElroy wrote.

“The majority of these suits concern actions that took place more than half a century ago. One important aspect of these lawsuits is that none of them claim sexual abuse by any priest of the Diocese of San Diego currently in ministry. This reflects the reality that the Church has taken enormous steps to root out the sexual abuse of minors in its life and to promote the protection of minors.”

In 2007, the San Diego Diocese paid out $198 million to settle 144 claims of abuse that had been brought during an earlier lifting of the statute of limitations, McElroy continued.

“This depleted most of the assets of the diocese. Even with insurance, the diocese will not be able to pay out similar sums now. This challenge is compounded by the fact that a bill has now been introduced into the Legislature that seeks to eliminate the statute of limitations entirely, leaving the diocese vulnerable to potential lawsuits forever,” McElroy wrote.

Separately, speaking to reporters on Friday, Kevin Eckery, communications director for the diocese, predicted that it would cost the diocese $550 million to settle the current cases.

Because of the corporate structure of the diocese, parish assets are held separately by individual parish corporations, McElroy noted. The bishop of San Diego in 2007, Robert Brom, requested bankruptcy at the time, but U.S. Bankruptcy Judge Louise DeCarl Adler dismissed the case.

“Almost without exception in other diocesan bankruptcies, parish assets have remained separate. At the same time, parishes in a diocese undergoing bankruptcy typically contribute some limited monies to the funds for claimants,” the cardinal wrote.

If the present bankruptcy comes to fruition, San Diego would join a growing number of U.S. dioceses in declaring bankruptcy in the past decade or so. The Diocese of Santa Rosa in California will likely declare bankruptcy in 2023 as well, the San Jose Mercury News reported in December 2022.

Since 2019, six of California’s 12 Catholic dioceses have been under an independently managed compensation program, which provides compensatory payment to those alleging to be victims of priestly sexual abuse, regardless of when that abuse is alleged to have happened.

The program covers Los Angeles, Sacramento, San Bernardino, San Diego, Orange, and Fresno. These six dioceses represent 80% of California’s Catholics, according to an announcement about the compensation program.

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  1. Certainly. lets continue to bankrupt diocese after diocese in a vain attempt to “make right” things which mostly happened 50 years ago when so much less was known about pedophilia and its associate behaviors. I have long believed that offering a financial payout for these claims provided a financial incentive for false claims. It is impossible either to verify or deny claims such as this 40 or 50 years after they supposedly happened. It is simply one persons word against another. Sexual abuse is most certainly a terrible crime but I dont believe money is the way to resolve it. Especially when such settlements go to damage the church whose resources are so badly needed elsewhere. I think that offering therapy paid for by the church to putative victims is the more practical way to help them.

  2. Dishonouring the Lord, by keeping wolves in positions of authority. Demeaning the flock by keeping wolves that tear the flock. This cardinal needs to resign.

    Some ask, where is Papa these days?

    Acts 20:29 I know that after my departure fierce wolves will come in among you, not sparing the flock;

    Matthew 7:15 “Beware of false prophets, who come to you in sheep’s clothing but inwardly are ravenous wolves.

    Ezekiel 22:27 Her princes in her midst are like wolves tearing the prey, shedding blood, destroying lives to get dishonest gain.

    2 Timothy 4:3 For the time is coming when people will not endure sound teaching, but having itching ears they will accumulate for themselves teachers to suit their own passions,

    2 Thessalonians 2:1-17 Now concerning the coming of our Lord Jesus Christ and our being gathered together to him, we ask you, brothers, not to be quickly shaken in mind or alarmed, either by a spirit or a spoken word, or a letter seeming to be from us, to the effect that the day of the Lord has come. Let no one deceive you in any way. For that day will not come, unless the rebellion comes first, and the man of lawlessness is revealed, the son of destruction, who opposes and exalts himself against every so-called god or object of worship, so that he takes his seat in the temple of God, proclaiming himself to be God. Do you not remember that when I was still with you I told you these things? …

    Acts 20:28 Pay careful attention to yourselves and to all the flock, in which the Holy Spirit has made you overseers, to care for the church of God, which he obtained with his own blood.

    Be strong in the Lord

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