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  Portland, Boston: a Tale of Two Endings
In Boston, Property Was Sold to Pay for Claims

By Peter Wong pwong@StatesmanJournal.com
Statesman Journal [Oregon]
July 11, 2004

The Catholic Church faced many claims by victims alleging years of sexual abuse by priests.

The number of claims mounted through the years, and so did their price tag - into the tens of millions of dollars.

Officials considered bankruptcy protection.

But for Boston and Portland, this tale of two archdioceses has different endings.

The Portland Archdiocese, one of the nation's smallest with 356,000 Catholics, filed for bankruptcy protection last week after facing claims amounting to at least $340 million.

"This action offers the best possibility for the archdiocese," the Rev. John Vlazny, Portland's archbishop, wrote in a pastoral letter.

The story isn't over for the Boston Archdiocese, which, with its 2.1 million Catholics, ranks behind only New York, Chicago, Detroit and Los Angeles in population. But an end to its costly claims might be in sight.

After more than 18 months in the glare of national publicity, beginning in early 2002, the Boston Archdiocese agreed last year to an $85 million settlement with about 550 victims.

That agreement was in addition to an earlier $10 million settlement with 86 people who said they had been abused by John Geoghan, a former priest who was killed in prison last year while serving a sentence of up to 10 years.

Fading story

Given the recent controversy in Massachusetts regarding state-sanctioned marriages of same-sex couples, "much of this is now old news," said Gregory Tracy, managing editor of The Pilot, published by the archdiocese and the nation's oldest Catholic newspaper.

The 2003 settlement did not end Boston's problems. But Father Christopher Coyne, a spokesman for the archdiocese, described the deal in a newspaper interview in the fall as "one good step toward bringing some kind of resolution to the crisis."

A few claims might go to trial, although four who dropped out of the big 2003 settlement ended up accepting a separate offer from the church of $1.4 million this year.

One former priest, Paul Shanley, faces criminal charges and is on trial now.

Portland is a different story.

The Boston Archdiocese could fit into the western Oregon domain of the Portland Archdiocese 12 times, and there are three other dioceses in Massachusetts. But one of every two people in Massachusetts is Catholic, compared with about one in 10 people in Oregon west of the Cascades.

Unsettled claims

The Portland Archdiocese faces about 60 sexual-abuse lawsuits, and that total eventually could run to about 80. The church said that it already has paid $53 million to settle 130 claims.

In to its filing last week with U.S. Bankruptcy Court, the church listed the 20 largest unsettled lawsuits seeking a total of $340 million in compensation.

Archdiocese spokesman Bud Bunce said that officials will compile the rest of the claims during court proceedings. Creditors who hope for compensation will have to file with the court.

"But never in our wildest imaginations do we think we are going to get $340 million for the rest of these victims," said Daniel Gatti, a Salem lawyer who represents seven of the top 20 plaintiffs, who are seeking $49 million of that total.

"That is preposterous. What the church ought to do is come to the table and make reasonable offers to compensate these people for their losses," he said. "Then these matters will go away."

Gatti said that his firm represents 20 to 30 victims. Five firms overall represent nearly all of those suing the Portland Archdiocese, alleging sexual abuse by priests.

The bankruptcy filing by the archdiocese came just before the beginning of a civil trial in Portland in which two plaintiffs sought more than $160 million.

"Should the church sell a third of its property in the state to pay two people for child sexual abuse that occurred 20 years ago by a priest who is now dead?" said Kevin Mannix, a Salem lawyer and a Catholic who, as a legislator in 1991, wrote Oregon's law enabling adults to sue people who abused them as children.

The bankruptcy filing puts the civil trial on hold.

"I do think $150 million far exceeds anything reasonable for a victim of sexual abuse," Gatti said. "That amount in a request should have been substantially less but that should be for a jury to decide."

Property at risk"

The Portland Archdiocese and lawyers for the plaintiffs disagree about whether property must be sold to raise money for compensating victims - and whether the archdiocese or its 124 parishes control property.

"We're not asking the Portland Archdiocese to sell assets," Gatti said. "From our research, we think they have $500 million."

Kelly Clark, a Portland lawyer who represents others filing sexual-abuse lawsuits, said he is convinced by a search of records that the archdiocese controls most church property in western Oregon - not the individual parishes.

He said the archdiocese could have transferred property to its parishes, as the Baker Diocese of Eastern Oregon did last year in a move that Clark said appeared to be an attempt to shield church property against such lawsuits.

"Our position is that the archdiocese does not get to have it both ways," he said. "It does not get to say that it owns all this property, and yet it does not."

Mannix said he thinks that a bankruptcy filing could force the church to sell some property, though not schools.

The Boston Archdiocese relied on property sales to pay off the loans it took out to finance its 2003 settlement.

Earlier this year, it sold its headquarters and other property to neighbor Boston College for more than $100 million.

Some money came from insurance companies, although the archdiocese is in a dispute with one of them regarding the amount it should pay. Some came from the sale of other property.

The Boston Archdiocese also is closing a net 65 of its 357 parishes because of declining attendance and shifting populations, as well as cutting other costs.

A legal standard

Lawyers say that the Massachusetts and Oregon laws related to child sexual abuse are comparable. Both allow victims to file suit as many as three years after they realize they were harmed by molestation or rape - even if the harm took place years earlier.

"The only difference is that in Oregon, all we have to do to hold the church responsible is show that a priest was acting as a priest and secured the trust of the victim," Gatti said.

That legal standard was established by the Oregon Supreme Court in a pair of 1999 cases, one of which Clark argued personally that the church should have institutional responsibility for sexual abuse by a priest.

"I totally disagree with that decision," said Mannix, who voted for a 1999 bill that would have limited the liability of churches and other employers for such conduct. The bill was vetoed by then Gov. John Kitzhaber, who said it was too broad.

Gatti said the aim of those filing sexual-abuse lawsuits was not to bankrupt the church.

"Our goal is for them to receive reasonable compensation for some serious injuries," he said.

Boston vs. Portland

Comparisons between the Boston and Portland archdioceses of the Catholic Church:

Archdiocese            Boston        Portland

Area (square miles)   2,465         29,717

Catholics                 2,083,899   356,037

Population               4 million      3 million

Parishes                  357*           124

Schools                   187**          52

Hospitals                  9               9

Rank                        5               22

(of 34 U.S. archdioceses)

Annual budget       $38.3 million*** $8.7 million

Sexual-abuse claims  $97.4 million $53 million
(paid or agreed to)

Pending claims      Unknown       $341 million****

Assets                  $44.7 million   $50 million*****

*Total will shrink to 292.

** Excludes seven colleges and universities.

*** Excludes $85 million reserve for 2003 settlement of sexual-abuse claims.

**** Twenty largest unsettled lawsuits, according to bankruptcy filing; total likely to be higher.

***** Reported by archdiocese but disputed by lawyers.

Source: Archdioceses

pwong@StatesmanJournal.com or (503) 399-6745

 
 

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