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  Agreement May Mean April End to Bankruptcy

By John K. Wiley
The Oregonian [Spokane WA]
January 6, 2007

http://www.oregonlive.com/news/oregonian/index.ssf?/base/news/1168048518293090.xml&coll=7

Spokane -- After reaching a breakthrough agreement to pay victims of clergy sex abuse, the Catholic Diocese of Spokane's lengthy Chapter 11 bankruptcy could end as early as this spring, a judge said Friday.

During a telephone hearing Friday, U.S. Bankruptcy Judge Patricia Williams scheduled an April 24-25 hearing to confirm the diocese's plan of reorganization, a crucial step for ending the case that has stretched over two years.

"I am very pleased the proponents of the plan have managed to agree upon and negotiate the plan's terms," Williams said of the settlement announced Thursday by a federal mediator.

"Even though it will take another three to four months for a final resolution, that is time well spent because the parties have collectively controlled their own destiny, rather than have an appellate court control their destiny," Williams said.

Lawyers for the diocese, which filed for Chapter 11 protection in December 2004 in the face of mounting litigation over claims of clergy sexual abuse, said they will prepare a disclosure statement by Feb. 1.

The statement will include proposals for payments to individual creditors -- the abuse victims -- as well as how much of the $48 million pool will be available to them.

 
 

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