BUFFALO, N.Y. (WIVB) — The Catholic Diocese of Buffalo has filed for Chapter 11 bankruptcy protection.
The case was filed early Friday morning in U.S. Bankruptcy Court. There was an initial hearing later in the morning in which a judge approved several motions that will allow the diocese to continue financial operations.
Previously, an independent auditor speculated that an imminent bankruptcy filing would be made due to the sex abuse related lawsuits against the diocese. There are currently 258 of them. However, in court on Friday, the diocese’s bankruptcy lawyer speculated there may be about 400 “potential plaintiffs” when all is said and done. That does not include the 107 victims who have already settled claims with the diocese.
This past August, the Child Victims Act allowed for a one-year window for anyone to file lawsuits against against their alleged abusers, no matter how long ago the abuse happened.
According to the filing, the diocese is claiming $10 million to $50 million in estimated assets, and $50 million to $100 million in estimated liabilities.
“This is a significant event that we’re doing today,” said Bishop Edward Scharfenberger, the diocese’s temporary apostolic administrator. “I think it it will actually speed up the process to be quite frank with you. It will be able to address specifically those individuals who most are seeking that kind of recovery.”
The move makes Buffalo the 24th Catholic diocese or religious order in the United States to file for bankruptcy since 2004.
The diocese’s previous leader, Richard Malone, stepped down from his position as Bishop after coming under fire for his handling of various sex abuse allegations involving local priests.
Attorneys for alleged victims of abuse who have filed lawsuits assert the bankruptcy has a different purpose than what officials are claiming.
“The Diocese of Buffalo is using bankruptcy to continue to conceal the truth about predator priests in this diocese,” a statement from attorneys Jeff Anderson and Steve Boyd said.
At a press conference, Friday afternoon, Scharfenberger addressed the bankruptcy filing, calling it “a big day for the Diocese.”
During the conference, Scharfenberger spoke on what happened behind closed doors during a private meeting of priests on Monday. Some of those priests were known abusers or accused of it.
The point of that meeting was the discuss the bankruptcy filing and have Mass.
Money collected at parishes will not go toward any part of any settlement, Scharfenberger told reporters during the conference.
This afternoon the Movement to Restore Trust had this to say about the diocese’s decision to file for bankruptcy:
When the magnitude of victims claims against the Diocese of Buffalo under the Child Victims Act became clear several months ago, the Movement to Restore Trust concluded that a bankruptcy filing by the diocese was inevitable,” said John J. Hurley, Movement to Restore Trust Organizing Committee Member. “Resolving the claims of victims of sex abuse under the supervision of a federal bankruptcy judge is the only way to insure the prompt, fair and equitable treatment of claimants. The bankruptcy court will provide a forum in which the legitimate interest of victims in openness and transparency can at last be assured. We think that it will provide the essential starting point for the reconciliation, healing, and ultimately, reform of the Catholic Church in Buffalo that so many desire.”Movement to Restore Trust
The diocese is providing those with questions about the reorganization with a helpline number and an informational page through Twitter.