MILWAUKEE (WI)
Milwaukee Journal Sentinel
By Annysa Johnson of the Journal Sentinel
Creditors in the Archdiocese of Milwaukee bankruptcy cannot sue to recover more than $35 million in parish investment funds that the archdiocese moved off its books in 2005, a federal judge ruled Monday.
It was the second major victory for the archdiocese and its parishes in recent days.
In a 23-page decision, U.S. Bankruptcy Judge Susan V. Kelley said, “arguably there was something ‘fishy’ about the transfer” at a time when the archdiocese was being sued for sexual abuse by priests and had started a mediation program for survivors.
But Kelley said the money never belonged to the archdiocese, that the parishes took the funds back or invested them elsewhere in good faith, and that the high cost of litigation would undermine the archdiocese’s ability to develop a reorganization plan.
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