SPOKANE (WA)
National Catholic Reporter
Jul. 20, 2012
By Tom Gallagher
The Spokane, Wash., diocese recently announced that a new settlement had been reached with respect to current, pending claims of sexual abuse. The settlement culminates almost a decade of complex litigation and a 2004 bankruptcy filing that cost the diocese $48 million.
A major complication involved the Morning Star Boys’ Ranch, which once had elements of control in favor of the diocese in its governance documents. In reality, the ranch operated on its own and was led for decades by Fr. Joseph Weitensteiner, who himself has been accused of sexual abuse. Prior to the 2004 bankruptcy, the ranch was legally separated from the diocese.
A critical issue post-bankruptcy was how to fund future claims against the diocese and, specifically, some two-dozen unresolved claims filed by former Morning Star Boys’ Ranch residents. The future claims fund was woefully underfunded and was collateralized by practically all of the real estate of the parishes and their schools. A funding default would have triggered the foreclosure of parishes and schools.
With the new settlement, the diocese and parishes agreed to put $1.5 million toward the future claims fund. There will be no foreclosures. All appeals will be withdrawn.
How did all this come about?
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