Archdiocese of Portland Bankruptcy
Interview of Mark Chopko by Bob Abernethy
Religion & Ethics Newsweekly
July 9, 2004, Episode no. 745
BOB ABERNETHY, anchor: In Oregon, the Roman Catholic Archdiocese of Portland became the first Catholic diocese in the nation to file for bankruptcy. The archdiocese has already paid $53 million to settle sex abuse lawsuits. The bankruptcy filing put on hold two trials in which plaintiffs are seeking a total of $155 million. For now, the archdiocese is protected from creditors. The case is being closely watched across the country, as many other dioceses also face major financial problems in the wake of the priestly sex abuse settlements. Joining us to discuss the implications of the bankruptcy filing is Mark Chopko, general counsel for the U.S. Conference of Catholic Bishops and adjunct law professor at Georgetown University. Mr. Chopko, welcome. Why did the Portland archdiocese file for bankruptcy?
MARK CHOPKO (General Counsel, U.S. Conference of Catholic Bishops): It felt that its back was literally against the wall. After having spent more than $50 million to compensate more than 100 people, the fact that these two lawsuits were going to trial threatened to wipe out the remaining assets of the archdiocese. Now, that would both impair their religious mission and make them unable to compensate another 30 or more people who are also pressing claims against the archdiocese. So the only way it felt it could both continue with its religious mission to serve the people in western Oregon as well as to compensate all of the victims, not just the two going to trial, it had to file this kind of a chapter proceeding.
ABERNETHY: Did the archdiocese have to get permission from the Vatican in order to do that?
Mr. CHOPKO: Under canon law there would be certain permissions that would be required, and I do not know what has gone back and forth between Rome and Portland.
ABERNETHY: But they probably did?
Mr. CHOPKO: They'd have to follow the canon law, and there'd have to be consultation and permissions.
ABERNETHY: Does filing for bankruptcy imply mismanagement?
Mr. CHOPKO: Not at all. It implies that you've been overwhelmed by your creditors and potential creditors.
ABERNETHY: So, briefly, what's the process now? The archdiocese is going into court, and then what happens?
Mr. CHOPKO: They're already in court and the bankruptcy judge will now, over the next month or so, set up a number of schedules that will have to be met for meetings with creditors, formation of committees, and then the preliminary filings. We'll see this unfold over the next two or three months.
ABERNETHY: But does it now become theoretically possible that the court could tell the archdiocese what it has to do in order to come up with some money? For instance, could the court tell the Archdiocese of Portland that it has to sell a high school or get rid of a feeding program, maybe an individual parish?
Mr. CHOPKO: There are enormous church-state implications from this kind of filing. It is certainly more than theoretically possible -- there's a real possibility that a bankruptcy court might come and look at the archdiocesan finances and have different ideas about what constitutes the religious mission of the archdiocese than the archdiocese does. There could be enormous difficulties along the road. If the court follows the precepts of church-state law and stays out of the religious mission of the archdiocese, then there shouldn't be a problem. But as your question implies, there is a real possibility that there could be some disagreements between the court and the archdiocese.
ABERNETHY: And then who decides?
Mr. CHOPKO: The civil courts will decide for this round. But, certainly, any decision will be appealed, and it could end up in the U.S. Supreme Court.
ABERNETHY: And what about people in an individual parish? Is their building at risk now? Is the money that they give in the collection plate on Sunday at risk of going to the archdiocese?
Mr. CHOPKO: Almost everything that's collected in churches around the country, not just Catholic churches but [also] other churches, stays in the local churches for their administration. My view is that none of that should be at risk. All of that, essentially, belong to the works of the parish, to keep the religious education program going, to keep the closets stocked with food, to take care of the people who need assistance, to pay their bills.
ABERNETHY: Can the Vatican help out an individual archdiocese?
Mr. CHOPKO: All of the dioceses in the United States are separate from each other, civilly and canonically. In fact, the dioceses around the world support the Vatican, not the other way around.
ABERNETHY: What are the implications then for other dioceses around the country?
Mr. CHOPKO: This is being watched closely, not just in Catholic circles but in non-Catholic circles, because no one has ever done this and, as I said, it's fraught with potential problems. But there are several dioceses -- Tucson has been in the press recently -- that also are facing enormous litigation threats and have their backs against the wall with not having adequate assets to take care of all of the people who have come forward, as well keep the religious mission going.
ABERNETHY: Mr. Chopko, many thanks.
Mr. CHOPKO: My pleasure.
ABERNETHY: Mark Chopko, the general counsel for the U.S. Conference of
Catholic Bishops and adjunct professor of law at Georgetown University.
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