November 10th 2024.
The Diocese of Oakland recently put forth a proposal to create a trust worth over $117 million to settle hundreds of lawsuits alleging sexual abuse by its priests. However, this deal was quickly met with disappointment from victims' attorneys, who called it "pathetic."
The proposed payout was a key part of the diocese's reorganization plan, which was filed on Friday in an effort to emerge from Chapter 11 bankruptcy and resolve about 350 lawsuits from individuals who claim to have been abused by leaders of the Catholic church. The trust would be funded over several years and would also include a Livermore property that the church believes could bring in tens of millions of dollars in value for the victims.
But the attorneys for the sexual assault victims were quick to criticize the plan, calling it a "scam and a sham." They accused the diocese of deliberately undervaluing its assets in order to avoid paying out more to the victims. The proposed settlement amount is significantly less than the $880 million settlement reached last month between the Archdiocese of Los Angeles and over 1,350 individuals who sued church leaders in Southern California.
According to Rick Simons, an attorney representing numerous sexual assault victims, the diocese is trying to "cram down" this plan without the agreement or approval of the survivors, as they are unwilling to negotiate a fair settlement and are more concerned with saving money. He went on to say that their proposed amount is "pathetic."
In a statement on their website, the Diocese of Oakland defended their plan, stating that it offers "just and equitable compensation." They also mentioned that the trust's value could potentially increase to between $43 million and $81 million when factoring in the value of the Livermore property's title. Additionally, the diocese proposed giving all the rights and interests of their insurance policies to the trust, allowing victims to seek compensation from the diocese's insurers.
Bishop Michael C. Barber, in the diocese's statement, acknowledged that no amount of money can fully compensate survivors for the abuse they endured. However, he believes that the proposed plan is fair and equitable, and also allows the diocese to continue their mission of spreading the Gospel and serving the faithful and the poor.
This proposed settlement comes after a surge of lawsuits made possible by a recently-closed, three-year filing window that catered to cases that had expired due to the statute of limitations. Many of the lawsuits alleged abuse dating back several decades by priests who were allowed to abuse parishioners without consequence.
Only a few months after this special filing window closed in late 2023, the diocese filed for Chapter 11 bankruptcy protection. This was met with criticism from abuse victims and their attorneys, as their lawsuits were effectively put on hold while a bankruptcy judge reviewed the church's finances and assets.
According to Dan McNevin, an Alameda County survivor of abuse, the bankruptcy filing was just another way for the church to cover up their actions. McNevin's lawsuit against the church nearly 20 years ago was one of 56 cases that settled for an average of $1 million, a much larger amount than the diocese's current proposal, especially when considering inflation.
The filing on Friday also included the creation of a "Survivor's Trust," which would consist of $103 million in cash from the diocese and $14.25 million from the Roman Catholic Welfare Corporation/Schools. The Livermore land title would also be transferred to the trust "as-is, where-is." This property was originally intended to be the site of a high school but is now vacant.
The trust would be funded in installments over the next few years, starting with an initial installment of $65 million and increasing by $10-13 million in subsequent years. The diocese stated that the plan was filed on the last day they had the exclusive right to do so with the bankruptcy court. They also mentioned that they will be obtaining a loan, using cash resources, and selling real estate to fund the trust, but did not provide further details.
Bishop Barber, in an October note to parishioners, expressed hope that the survivors would recognize that the diocese is working in good faith to compensate them fairly. However, the victims' attorneys argue that not funding the trust immediately would short-change those who have already been victimized by the church, as the value of the trust could decrease over time due to inflation. They also question the transparency of the church's financial accounting.
The attorneys also believe that the church could sell off its significant real estate holdings in the region to pay more towards the settlement. They suggest starting with the dozens of parishes that are currently without priests. According to Jeff Anderson, an attorney representing over 100 victims, the church is prioritizing their own interests over the children they harmed. Jennifer Stein, an attorney for numerous victims, added that they have the means to pay more but are choosing to prioritize their own interests over those they were supposed to serve as a Catholic community.
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