Stockton Diocese Reveals Bankruptcy Plan

By Almendra Carpizo
Record
September 20, 2016

http://www.recordnet.com/news/20160920/stockton-diocese-reveals-bankruptcy-plan

The Diocese of Stockton on Tuesday announced a plan that could result in its exit out of bankruptcy more than two years after legal costs stemming from dozens of child sexual-abuse lawsuits depleted its funds.

Bishop Stephen E. Blaire said the diocese, which filed for bankruptcy in January 2014, negotiated with all the parties involved to reach a consensual plan, which includes:

$15 million to survivors of sexual abuse and a trust for the benefit of survivors.

Payment of at least 50 percent of what is owed to unsecured creditors.

Restructuring of unsecured loans.

Funding from the plan will come from the Diocese of Stockton, settling insurance carriers and other entities associated with the diocese.

The $15 million settlement agreed upon by the diocese, the plaintiffs' attorneys and insurance companies is to “provide for the healing of the survivors,” Blaire said during a news conference. The diocese is responsible for $9.89 million of the total amount.

The Bishop said the plan, if accepted, will allow the diocese to exit bankruptcy by the end of the year and continue operating.

Blaire said the plan will settle the cases of 27 victims who came forward during the period of bankruptcy, but $750,000 out of the $15 million will be set aside for any future plaintiffs who did not come forward in that time frame.