A committee representing clergy abuse survivors is asking a federal bankruptcy judge to reconsider her order barring lawsuits against Catholic schools and parishes as part of the Archdiocese of Baltimore’s Chapter 11 bankruptcy.
Parishes and schools are technically not assets of the archdiocese, despite Archbishop William E. Lori having control over whether they can be bought or sold, but were granted protection from lawsuits because the archdiocese insures them.
In early October, U.S. Bankruptcy Judge Michelle Harner issued an interim injunction on lawsuits against entities covered by archdiocesan insurance policies (known as covered parties). Harner determined those policies are assets of the corporation that makes up the archdiocese, meaning any lawsuit would inevitably draw down on insurance monies in order to pay legal fees and settlements.
Whenever any entity files for bankruptcy it is automatically protected from lawsuits so its assets can be preserved to pay creditors. Sometimes those protections can…
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