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New York
A diocese of the Roman Catholic Church in New York has agreed to pay $323 million to 530 child sexual abuse survivors in a move that will result in the largest bankruptcy of a US diocese.
The Diocese of Rockville Centre in Long Island, New York told a bankruptcy hearing on Thursday (Sep 26) that the settlement will cover the liabilities of all the parishes under it.
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The diocese has 1.2 million members in Nassau and Suffolk counties.
A diocese consists of a large area of the Catholic Church under a single Bishop. A parish is an individual Catholic community with its own church.
Under the settlement, each of the 135 parishes in the diocese will have to file their own bankruptcy suits. This would provide the parishes with legal protections in exchange for subjecting their assets and liabilities to court oversight, the diocese’s attorney Corinne Ball said in court.
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The settlement comes in the wake of four years of tough negotiations in the wake of hundreds of lawsuits alleging child sexual abuse by priests.
Martin Glenn, the bankruptcy judge hearing the case called the deal “enormous progress”.
Earlier, the survivors had rejected the diocese’s $200mn settlement offer.
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As per the new agreement, Rockville Centre will fork out $234.8mn to a settlement fund, with four insurers contributing $85.3mn, Reuters news agency reported.
The diocese filed for Chapter 11 bankruptcy in October 2020, burdened by the mounting legal costs caused by the child abuse lawsuits.
At least 24 dioceses in the US filed for bankruptcy in recent years when a statute of limitations was lifted, allowing child sex abuse survivors to sue over decades-old abuse.
The Rockville case could become the template for several other dioceses facing similar bankruptcies over other child sex abuse cases involving the Catholic Church.
The archdiocese of New Orleans recently proposed that it and its affiliates settle the bankruptcy it filed in May 2020 for just $62.5mn, Reuters said in the report.
(With inputs from agencies)