Wash. Diocese to File for Bankruptcy

By Cathy Lynn Grossman
USA Today [Spokane WA]
November 10, 2004

The Roman Catholic diocese of Spokane, Wash., facing a wave of lawsuits by alleged victims of child sexual abuse involving clergy, will file for bankruptcy protection Nov. 29, its bishop said Wednesday. It is the third diocese to do so since July.

Spokane Bishop William Skylstad said Chapter 11 bankruptcy protection was needed to protect the diocese's assets and ministries serving 90,000 Catholics in eastern Washington, and still offer just compensation to 125 alleged abuse victims "as well as those who may come forward in the future."

Multimillion-dollar lawsuits continue to be filed in a scandal that has already cost the church $772 million nationwide.

"The public better get used to the idea of the Catholic Church going bankrupt," says the Rev. Thomas Reese, editor of the Jesuit magazine America. "That's the future if these suits continue to mount up and cost millions and millions of dollars. There's no other solution for many dioceses."

Mediation broke down last week between the Spokane diocese and attorneys representing 28 plaintiffs. Skylstad said Wednesday that about half of 125 alleged victims had retained counsel, and bankruptcy would protect those who filed last from the harm of "losing the race to the courthouse."

"We are not a wealthy diocese," Skylstad said. Already the diocese has paid about $1 million in abuse-related claims to date. Under Chapter 11, only a bankruptcy judge can authorize archdiocesan spending beyond normal operating expenses, all litigation is halted and all abuse lawsuits combined. Bankruptcy would not close parishes and schools.

The Spokane announcement comes as no surprise. In October, Skylstad warned his congregation in a letter sent to homes that he would go this route if mediation failed.

The letter included a question-and-answer sheet on bankruptcy's potential impact. One of the primary goals, it said, would be to protect parish assets and schools.

The Portland (Ore.) Archdiocese filed in July, just moments before the opening of a civil trial by two alleged victims seeking more than $155 million. Portland Archbishop John Vlazny said the diocese had already spent $21 million on more than 100 abuse-related claims in the past four years.

The Diocese of Tucson, which has spent about $16 million so far on abuse-related costs, filed in September. Bishop Gerald Kicanas also said the filing was intended to protect the assets on behalf of everyone in the diocese, which still faced 22 lawsuits.

Many of the cases in Spokane relate to one priest, Patrick Gerald O'Donnell, who admitted molesting more than 30 children in the mid-1970s, according to The Seattle Times. Skylstad, who was a priest in the same rectory at the time of the alleged abuses, told the newspaper he was "deeply sorry" that he couldn't recall claims by a victim who said he warned Skylstad three times about O'Donnell's behavior.

Abuse victims are angry; some say they're being blamed for bankruptcy filings and church closings when people should instead be blaming the failure of bishops to prevent and report abusive priests and remove known abusers from ministry over decades.

"The common denominator in these bankruptcies is that they are filed when the bishop is on the verge of a potentially embarrassing court case packed with potentially damaging documents that would be made public," says David Clohessy of the Survivors Network of those Abused by Priests. "This is not about being fair. This is about protecting their secrets and assets."

Clohessy says he will confront the bishops on their handling of abuse claims at the bishop's annual fall meeting next week in Washington, D.C. The first item on the agenda is election of a new president, and the leading candidate is the current vice president Skylstad. He declined Wednesday to say whether he would withdraw his candidacy.


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