Archdiocese of New Orleans bankruptcy moves another step closer to $230 million resolution

(OSV News) -- The Archdiocese of New Orleans has edged one step closer to finalizing its long-running -- and costly -- bankruptcy proceedings to resolve hundreds of clerical abuse claims.

A committee of survivors and additional creditors overwhelmingly voted to accept the plan for a $230 million settlement, which would include tailored payment amounts factoring in the scope of the alleged abuse and its impact on claimants. The plan would also permit the release of files on abusive clergy.

However, one group of bond investors filed an Oct. 28 request calling for further discussion of the archdiocese's Chapter 11 reorganization plan, now in its fifth version.

In response, the official committee of unsecured creditors in the case filed a response with the court, accusing the bondholder of "delay and subterfuge tactics" in "an attempt to fruitlessly delay confirmation and thwart justice for the more than 99% of abuse survivor creditors who voted in favor of the Plan."

A confirmation hearing is set to begin on Nov. 17, with testimony scheduled through Dec. 4. The Dec. 2 session will see survivors take the stand to share their personal experiences.

In a Sept. 8 press release, the archdiocese had said "individuals who experienced sexual abuse" involving either the archdiocese or 157 affiliated Catholic organizations -- including "parishes, schools, academies, Catholic Charities organizations, and other ministries" -- could be eligible for compensation under the proposed settlement trust.

Claims can be filed for any "unwanted sexual behavior, contact, comments, or any conduct that was sexual in nature, whether or not it was recognized as abuse at the time," said the archdiocese in the release.

Those who had not already filed a claim in the bankruptcy case or served the archdiocese with a lawsuit by Aug. 14 must have their claims filed and received by Dec. 2 at 11:59 p.m. Central Time, or face possible "permanent loss of the right to receive payment" from the proposed settlement trust, the archdiocese noted.

Claims can be filed online at www.NOLAchurchclaims.com. Applicants can also download a form from the site, or call 877-476-4389 to request a form by mail.

The Chapter 11 filing -- which dates to 2020 and was prompted by some 500 abuse claims -- has been what Archbishop Aymond previously called “a much longer, complicated, and costly process than anyone could have predicted.”

OSV News has confirmed with the archdiocese that its legal fees to date in the case have so far totaled approximately $50 million.

In April, Judge Meredith S. Grabill had issued an order on a potential dismissal of the "particularly contentious" suit, which had failed to reach a reorganization plan after five years of litigation.

In a May 1 statement, the archdiocese admitted the “unacceptable amount of time and money spent over the past five years,” but held that “dismissal is not in the best interest of all survivors.”

Although Grabill noted in her April 28 order that lengthy, expensive legal proceedings are “not unusual or unexpected in complex mass-tort cases," the court's patience appeared to wear thin, especially after several regular status conferences and the appointments of both an independent expert and an additional mediator to move the case along.

In statements issued April 28 and May 1, the New Orleans Archdiocese stressed its intention to support survivors in their pursuit of justice and healing.

In September 2023, Archbishop Aymond advised the faithful that parishes would need to contribute to the settlements.

Along with the wranglings over bankruptcy and survivor compensation, the archdiocese’s battle to resolve sex abuse claims has also included:

-- The recusal of a previous judge in the Chapter 11 case.
-- The guilty plea and life sentence of Msgr. Lawrence Hecker for rape and other crimes committed in 1975-1976.
-- An investigation by the Louisiana State Police and the FBI to determine if archdiocesan officials covered up child sex trafficking by clergy over several decades, with some alleged victims reportedly taken out of state to be abused and marked for further exploitation among clergy.

A search warrant in that investigation was issued in May 2024. Louisiana State Police Public Information Officer Jacob Pecheu confirmed to OSV News the investigation was ongoing. OSV News is awaiting comment from the archdiocese regarding the investigation.

OSV News has found that from 2004 to 2024, U.S. Catholic dioceses collectively paid a total of more than $5 billion to settle abuse claims.

In September, Pope Leo XIV appointed Bishop James F. Checchio of Metuchen, N.J., as coadjutor archbishop of New Orleans. Archbishop Checcio will assist Archbishop Aymond until the latter's canonically required resignation, submitted upon reaching the age of 75, is accepted by the pope.