New York diocese offers $200 million to abuse victims in largest-ever settlement offer

Rockville Centre, N.Y., Nov 30, 2023 / 16:55 pm (CNA).

In what it called its “best and final” offer to survivors of abuse, the Diocese of Rockville Centre in New York on Monday proposed a plan that offers $200 million to approximately 600 survivors of abuse, the largest-ever settlement offer made in diocesan bankruptcy history.

The new plan includes an immediate cash payout of a minimum of $100,000 to claimants with a lawsuit and a $50,000 minimum to claimants without a qualifying lawsuit.

In a statement released Monday, the Long Island diocese called the plan “the best, most efficient, and most effective means to immediately begin compensating all eligible survivors equitably while allowing the diocese to emerge from bankruptcy and continue its charitable mission.”

The settlement offer includes a diocesan contribution of $50 million as well as a $150 million contribution from “parishes, co-insured parties, and other Catholic ministries,” according to the statement.

“The diocese agrees with Bankruptcy Court Judge Martin Glenn, who is overseeing the case, that survivors have waited too long for compensation and that any alternative to a global settlement plan creates chaos that puts both survivor compensation and the futures of parishes at risk,” the statement continued.

In July, Manhattan-based Glenn, the chief bankruptcy judge for the Southern District of New York, threatened to end bankruptcy proceedings if the diocese and abuse survivors could not reach an agreement, which would then send the cases back to state court for civil trials, Newsday reported at the time.

In its Nov. 27 statement, the diocese said it “has already made it clear that it is at the end of its resources. … Continuing to prolong the case, or dismissing the case, will ensure that payments to survivors only go down from the current settlement offer contained in the plan.”

On Tuesday, however, Glenn said he would not approve a bankruptcy plan without detailed information from the diocese’s parishes, as abuse claimants who would vote on the plan need to be able to weigh the value of their claim against the available resources at the parish where their abuse occurred, Reuters reported Nov. 28.

According to Reuters, James Stang, a representative of the official committee of abuse survivors in the case, said claimants would not vote for the new plan because it would eliminate legal claims against individual parishes.

The Diocese of Rockville Centre filed for bankruptcy in October 2020 after the passage of the Child Victims Act in New York in 2019 allowed for sex abuse lawsuits to be filed in past cases where survivors had not yet taken action, long after the statute of limitations had expired.

The diocese is one of six in the state of New York to have declared bankruptcy; only the Archdiocese of New York and the Diocese of Brooklyn have not filed for bankruptcy.