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September 22, 2004
Tucson Diocese files for bankruptcy
TUCSON, Ariz. (AP) - The Roman Catholic Diocese of Tucson filed for bankruptcy protection Monday, becoming the second U.S. diocese to seek court protection because of the cost of clerical sex abuse cases.
Tucson Bishop Gerald F. Kicanas told parishioners in a letter that filing the voluntary petition for Chapter 11 bankruptcy reorganization offered ``the best opportunity for healing and for the just and fair compensation of those who suffered sexual abuse by workers for the church in our diocese.''
He had signaled his intent to file bankruptcy in June to parishioners, saying bankruptcy protection seemed the only option left for the diocese, which serves some 350,000 Catholics in 75 parishes.
At a news conference, Kicanas aimed his initial remarks toward victims. ``I only wish that we could change what has happened to you, and that I could take away some of the suffering that you have endured,'' the bishop said.
The diocese's decision will subject its financial operations to court scrutiny for the first time, and potentially open the way for non-church interference.
Diocesan lawyers also were filing a plan for reorganization, and bankruptcy attorney Susan Boswell said she hoped creditors would cooperate in a manner allowing the diocese to emerge with a court-approved discharge within months.
The reorganization plan calls for plaintiffs in sex abuse cases to be paid through a compensation pool, including $3.2 million from the diocese. Victims could seek settlement from a court-appointed official or through a jury trial.
In addition, insurance companies that have refused to pay on claims would be expected to contribute money or could be sued, Boswell said.
Plaintiffs' lawyers believe the diocese has enough money to settle the cases now pending.
The Tucson Diocese settled 11 abuse lawsuits filed by 16 plaintiffs for more than $10 million two years ago, and by the latest count, 22 more molestation claims with 34 plaintiffs have been brought against the diocese.
The Portland (Ore.) Archdiocese became the first American diocese to file for bankruptcy on July 6. The Boston Archdiocese and Dallas Diocese both considered filing for bankruptcy because of abuse cases but avoided doing so.
Kicanas said his diocese will continue working toward settlements in the cases against it, despite the filing.
However, ``I could not have agreed to a settlement if it would have meant stripping the diocese of everything and thus limiting our ability to respond to the needs of others who have been hurt who may come forward in the future,'' the bishop said.
Dan Glosband, an attorney who represented the Archdiocese of Boston while it was considering seeking bankruptcy protection, said regular diocesan operations in Tucson shouldn't be affected by the filing.
But the status of the parishes will be a key issue before Bankruptcy Judge James M. Marlar.
Under the filing, each parish is listed as a creditor. The parishes have separate bankruptcy attorneys.
Plaintiffs believe the parishes are part of the diocese, since title to their property is in the name of the bishop, attorney Lynne Cadigan said.
Cadigan represented those plaintiffs who settled in 2002 and is the lawyer in several pending cases, including one that was to have started next week in Yuma.
If the diocese takes the position that the parishes are separate entities, she said, ``why can't the trials go forward against the parishes alone? There's no legal reason they couldn't.''
A settlement easily could have been reached ``but the diocese did not want a settlement,'' Cadigan said.
``The real reason they're filing this bankruptcy is to cut off future claims,'' she said.
A jury trial would have exposed the depth of the scandal and ``why for 30 years there was unchecked child abuse and rapes of children going on here in Tucson,'' Cadigan said.
Cadigan accused Kicanas of using the bankruptcy filing as a public relations move to paint the victims as forcing him into bankruptcy.
Boswell denied any such intent, describing Kicanas' decision as a difficult one he had wrestled with for several months.
In Chicago, Barbara Blaine, president of the Survivors Network of those Abused by Priests, said ``hundreds of cases have been settled (elsewhere) by bishops who decided to put healing first,'' she said. ``And we think that's what's really important.''
On the Net:
Tucson Diocese: http://www.diocesetucson.org/
Posted by Nealus at September 22, 2004 08:05 PM
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