Rockville Diocese Reaches Bankruptcy Agreement With $323M for Sex Abuse Claims

The Roman Catholic Diocese of Rockville Centre in New York reports that it has reached an agreement with survivors, insurers, parishes and other parties on a settlement of its bankruptcy case that includes a $323 million fund to compensate victims of clergy sexual abuse.

The total proposed settlement includes insurance contributions, diocesan assets and sale proceeds from diocesan property, and contributions from parishes and other related entities. The diocese, parishes and other related entities will contribute a total of $234.8 million. Insurance companies will contribute a total of about $85 million. Counsel for the committee of creditors will contribute $3 million.

The terms were made public at a hearing on September 26.

Part of the settlement plan involves all parishes entering into an abbreviated Chapter 11 with the approval of the court and the parties to the case in order to secure a release from liability for the parishes. No parishes are closing as a result of this process.

“The Diocese’s goal has always been the equitable compensation of survivors of abuse while allowing the Church to continue her essential mission. We believe that this plan will achieve those goals,” the diocese said in a statement announcing the agreement.

Adam Slater, managing partner of Slater Slater Schulman LLP, which represents 100 of the approximately 600 survivor-claimants in this matter, said this is the largest diocese settlement in the history of New York State, and the first diocese settlement to be reached nationwide following the Supreme Court’s recent Purdue Pharma decision relating to non-consensual third-party releases.

“The majority of our clients are in their 60’s and 70’s – they have been waiting decades for justice, and we are extremely pleased to reach this settlement on their behalf,” Slater said.

Jeff Anderson, another survivors’ attorney, credited “the courage, perseverance, and truth-telling of the survivors” for the agreement and noted that the diocese, the bishop, the parishes, and the schools are all required to have “rigorous child protection protocols in place as part of this settlement.”

The Rockville diocese filed for protection under bankruptcy in October 2020 as it faced more than 600 lawsuits of alleged clergy abuse after New York State enacted the Child Victims Act in 2019. The law allowed survivors to file retroactive lawsuits and eliminates the statute of limitations for all future lawsuits based on childhood sexual abuse claims.

The Rockville Centre diocese has 132 parishes. Priests working at numerous churches within the diocese have been accused of sexually assaulting minors. The diocese’s filing for bankruptcy halted the abuse cases in state court subject to the church coming up with a plan with insurers and survivors and approved by the bankruptcy court to handle the claims.

The bankruptcy court had given the church until October 31 to come up with a plan. If there was no plan, the judge could end the bankruptcy process and return the lawsuits to state court. The first trial was scheduled to start in just weeks.

The insurers involved in the talks include Allianz units Interstate Fire & Casualty Co., Fireman’s Fund Insurance Co. and National Surety Corp., along with Certain Underwriters at Lloyd’s and London Market Companies. The insurers issued policies covering the time period from 1976 to 1986. Allianz companies wrote excess insurance coverage.

The participation of another insurer, Arrowood Indemnity, is uncertain as it is currently involved in liquidation proceedings in Delaware.

In April 2024, the diocese proposed a $200 million settlement that was rejected by survivors. The bankruptcy court then ordered the parties to restart settlement negotiations.

Topics Claims