Judge dismisses key sex abuse claims against archdiocese

Annysa Johnson reported at the Milwaukee Journal Sentinel on yesterday's hearing.

"U.S. Bankruptcy Judge Susan V. Kelley threw out nine of 10 claims challenged by the archdiocese, saying seven of the victims failed to show evidence of fraud — the basis for their claims — and that lawsuits by two others had previously been dismissed by state courts."
[...]
"Barred by Wisconsin courts from asserting negligent supervision — the claim asserted in most church abuse cases around the country — survivors allege instead that the archdiocese defrauded them by moving problem priests from post to post without divulging they were a danger to children.

"Six of the survivors were unable to show Wednesday that the archdiocese knew about their abusers before they were molested because theirs were the first allegations to surface against those offenders. One, involving an unnamed priest, is the first and only accusation against that cleric, the archdiocese said."

The use of these representative claims is part of our Archdiocese's strategy.

Later in the article,

"[Archbishop Listecki's chief of staff Jerry] Topczewski said the archdiocese would use Kelley's rulings as the legal basis for the classification of victims in the reorganization plan."

So if other claims with similar facts get little or nothing under the plan, that is consistent with the court's ruling.

Speaking of strategy, if our Archdiocese filed for bankruptcy to avoid the cost of litigating claims in state court, and if we assume those cases would cost an average of $350,000 to take to conclusion, it's remains hard to see how it expected to come out ahead in bankruptcy.

"Legal fees in the bankruptcy have totaled more than $16 million, according to the archdiocese. However, victims' attorneys and the advocacy group Survivors Network of Those Who Have Been Abused by Priests, put it at more than $20 million."

And that's without the plan of reorganization in final form after over four years. It's by far the longest diocesan bankruptcy.

Earlier, the article notes,

"Kelley ruled last June that she did not have jurisdiction to approve the plan while key questions in a related lawsuit, over $60 million the archdiocese holds in trust for its cemeteries, are pending before the 7th Circuit Court of Appeals."

In the court record, the Summary of Hearing includes,

"The Court’s decision will not be issued or incorporated into a final order until the parties advise that they have discussed the most efficient way to limit appeal costs."

The court explained this approach in the February 10, 2015 Summary of Hearing that

"in an effort to limit the number of appeals from the confirmation proceedings, it would not issue a decision at the hearing on the Debtor’s motion to approve the proposed insurance settlements."

So it might not be until every contested point has been decided that all the decisions will be in one order. This is rather than risk having several issues appealed along the way which might even further delay approval of a plan of reorganization.