For the fifth time, judge extends deadline for Norwich Diocese to submit bankruptcy plan
A federal bankruptcy judge on Wednesday extended for the fifth time, the deadline for the Diocese of Norwich to submit its bankruptcy plan.
The previous deadline was set to expire on Thursday. But two weeks ago, attorneys for the Catholic diocese filed a motion to extend the deadline to Jan. 13, 2023.
On Wednesday, Judge James Tancredi extended the deadline for the diocese to file a plan until Nov. 18.
The diocese’s motion also revealed that 170 claims have been filed in the case, 142 of which come from people who allege they were sexually assaulted by priests and other in the diocese. It also revealed the diocese has completed its appraisal of the values of the three high schools owned by the diocese, including St. Bernard in Montville.
In arguing for the extension, diocesan attorneys wrote that the diocese and its creditors, which include a committee that represents the alleged sexual assault victims, have been negotiating terms of a bankruptcy plan with two mediation sessions held on Sept. 14 and 15.
They wrote that the diocese believes the mediation sessions “were quite productive in moving all parties in interest toward a consensual plan of reorganization” but after the second mediation session they have yet to reach agreement on certain terms.
Calling the case “highly complex”, the attorneys also wrote the diocese is hopeful that one or more additional mediation sessions will result in a consensus on a bankruptcy plan.
They further argued that allowing the alleged victims and other claimants to file their own bankruptcy plans would create a costly distraction due to litigation caused by competing plans. They wrote an additional extension will allow the diocese to build upon the progress made so far and maximize the recovery for the survivors of abuse and preserve the mission of the diocese.
It is expected, though, that the 142 victims will receive a fraction of what they could received if their lawsuits went to trial or were settled. In addition, the diocese has spent millions of dollars in legal fees on the bankruptcy case.
The diocese filed for Chapter 11 bankruptcy in July of 2021 as it faced more than 60 lawsuits filed by men who say they were sexually assaulted as boys by Christian Brothers and other staff at the diocese-run Mount Saint John Academy, a school for troubled boys in Deep River, from 1990 to 2002. Since then 82 additional people, whose sexual assault allegations involved not only the school but diocesan churches, have filed claims in the bankruptcy case. In addition, various other creditors are seeking a portion of the diocese's assets.
The bankruptcy process, which freezes lawsuits against the diocese, will assess the assets of the diocese and determine how much each victim will receive in damages. The 51 parishes in the diocese have joined the diocese in seeking bankruptcy protection from sexual abuse claims and will have to contribute funds to the settlement. This would leave victims unable to sue the parishes in the future. March 15 was the deadline for victims and others to file claims in the case.