Dear Parishioners, School Families and All Staff,
Last week we posted a statement on our website and social media referring to developments in the Diocesan bankruptcy case. That statement was also sent to all on our email address list. I am sharing that statement as well as a more thorough explanation of what is occurring in this week’s bulletin.
As you know, the Diocese has been in bankruptcy since 2020. The goal of this process was to equitably compensate survivors of abuse, to end all historical lawsuits against the Diocese and parishes, and to allow the Church to continue her mission.
In order to compensate survivors and protect the parishes from lawsuits, the Diocese and every parish will be making a contribution to the settlement. The settlement total has been accepted. Therefore, donations to the parish now and the future will remain with the parish. Also, to protect the parishes from any past liability, it will be necessary for every parish to enter into an abbreviated Chapter 11. This does not mean that our parish or school is in jeopardy or closing. Please do not panic if you hear it reported that parishes are “declaring bankruptcy”. As always, do not automatically believe everything you hear in the media. The parish Chapter 11’s should be completed within 48 hours and will not interfere with our work and ministry. This is being done so that the parishes can obtain releases for their protection from liability going forward.
While the settlement total has been accepted, the plan has not yet been confirmed. However, I wanted you to be informed of this so that you are not surprised or confused by anything that might be reported in the press. In the coming weeks, I will provide more detailed information as I receive it, and I will keep you fully informed as the plan is confirmed. Throughout this process and its many changes, I have kept our parish trustees, finance committee and key staff aware of all progress, challenges and delays in this process.
WHY BANKRUPTCY?
In 2019 New York State passed the Child Victims Act, a law which lifted the statute of limitations on lawsuits pertaining to the sexual abuse of minors for one year. Due to the COVID-19 pandemic the window to file claims was extended for an additional year.
As a result, thousands of lawsuits were brought against public schools, secular hospitals, and a wide range of institutions across the state. Hundreds of historical lawsuits were filed against the Diocese of Rockville Centre, its parishes, and related entities. Recognizing that judgments in just a few of these cases would not only cause financial devastation to the church, her mission, and the people she serves, but would only yield compensation for a sparse few of the survivors. The bankruptcy process was entered into so that there would be an equitable distribution of compensation to survivors, and the church could continue her mission.
Although the Diocese of Rockville Centre was the only entity filing for bankruptcy, the parishes and entities would be given the opportunity to contribute to a financial settlement and therefore receive freedom of liability for future claims on historical acts. Even if a new CVA was passed, the diocese, parishes and related entities would be protected from any claims prior to bankruptcy.
Lastly, in the bankruptcy process, the court places a stay on the litigation of civil cases. Parishes and entities benefited from that stay as we were either codefendants with the diocese or shared insurance coverage with the diocese.
Bankruptcy is a totally transparent process. All financial and real assets are made known to the creditors and the court. Although parishes and entities were not in bankruptcy, they obtained bankruptcy attorneys to advocate for our interests and participate in the mediation process that would determine the financial contribution that parishes and entities would contribute to the settlement fund.
PARISH AS A SOLE DEFENDANT AND THE LIFTING OF LITIGATION STAYS – After the diocese of Rockville Centre filed for bankruptcy, New York State extended the CVA window for another year. At that time attorneys began to file claims against parishes only and did not name the diocese as defendants. There then came a time when plaintiffs’ attorneys petitioned the court to lift the stay on parish only cases because the parishes were technically not in bankruptcy. The court did lift the stay on parish only cases and the litigation process began against parishes.
Our parish was one of those parishes that was a sole defendant on a case whose litigation process was rapidly moving forward. In fact, I was already deposed on this case which related to incidents that were alleged to have occurred in the early 1980’s. A trial for this case was approaching, with our parish facing significant litigation costs, a potential financial settlement, or even a financial judgment against us. In addition, our parish was named in four more cases, in which we were codefendants with the diocese
SUPREME COURT OF THE UNITED STATES BANKCRUPTCY DECISION – This summer SCOTUS decided against the ability of related entities to benefit from bankruptcy protections. This decision therefore made it impossible for related entities like a parish to pay into a settlement and be protected from future liabilities. To reach a settlement in the five cases against our parish and be protected from future liabilities, we would have to file for bankruptcy. Thus, the need for the 48-hour process described above.
PARISH CONTRIBUTION – All parties have agreed to the total sum that would create the fund that will compensate survivors. Details of the contributions of each parish are still being worked out. Those details will be a part of the final plan which the survivors will vote on in the next two months.
While our parish’s contribution is not finalized, we know that it will have a substantial impact on our reserve funds. Because our contribution must be made by the time the final plan is approved, the payment will not be coming from our current or future operating budgets, but from current financial reserves. Our parish will continue to function as it is, but with significantly less funds on reserve for capital improvements or unanticipated expenses.
Once I know our anticipated contribution, I will discuss the matter with our finance committee and inform you of the contributed amount.
SUMMARY – The most important point is that this long and painful process is coming to an end, survivors will be compensated and the future for our parish and school, as well as the Catholic Church on Long Island, will be secure and the mission of Christ will continue.
Above all else we are called to remember and pray for the survivors of sexual abuse as well as their families. The pain and sorrow brought about by the sins and crimes of sexual abuse are immeasurable. We hope that this financial resolution and compensation will assist in their healing.
This crisis has caused a great deal of anger and discouragement among all of us. The church of today is bearing the responsibility of the pains and sorrows of the past. I understand these emotions as I have felt them as well. The experience of being deposed over incidents that occurred when I was an adolescent myself, was particularly painful and frustrating, but it reminded me to bear this cross with a trust in the Lord and a desire to return our focus to carrying out his saving mission.
Please know that I am available to answer questions and bear your concerns to the best of my ability. I in turn ask for your support with both your prayers and your commitment to our parish. As I mentioned earlier, your financial stewardship going forward will not be applied to our settlement contributions but will only help us to restore our resources and care for our parish today.
Yours in Christ,
Fr. Gerard Gentleman, Pastor
Updated October 1, 2024
