The Roman Catholic Diocese of Rockville Centre in Long Island, New York, has reached a significant milestone in its bankruptcy proceedings. On September 26, 2024, the diocese announced a new settlement agreement that will provide over $323 million to approximately 530 survivors of sexual abuse. This development comes after previous attempts to reach a settlement had failed.
The diocese, which serves about 1.5 million Catholics in Nassau and Suffolk counties, filed for Chapter 11 bankruptcy in October 2020. This decision was prompted by the financial strain of lawsuits filed by individuals who had experienced childhood sexual abuse by clergy members. The bankruptcy filing occurred in the wake of New York state's enactment of the Child Victims Act in 2019, which opened a one-year window for victims to file lawsuits for past abuse, regardless of when it occurred.
U.S. Bankruptcy Judge Martin Glenn, overseeing the case in Manhattan, described the new agreement as "enormous progress." This sentiment is particularly noteworthy given that earlier in 2024, the diocese had expressed doubts about the possibility of reaching a settlement after survivors rejected a previous $200 million offer.
The settlement fund will receive contributions from multiple sources:
- $234.8 million from the Rockville Centre Diocese
- $85.3 million from four insurance companies
- Additional funding from another insurer undergoing liquidation
- Contributions from attorneys representing abuse survivors
Rev. Eric Fasano, spokesperson for the diocese, stated that the settlement would ensure "the equitable compensation of survivors of abuse while allowing the Church to continue her essential mission." This resolution is particularly significant as it comes four years after the diocese's bankruptcy filing, which was the largest of its kind at the time.
The Rockville Centre Diocese, established in 1957, has faced challenges related to sexual abuse allegations for years. In 2003, a grand jury report detailed allegations of abuse by priests within the diocese. Prior to the 2020 bankruptcy filing, the diocese had already paid over $60 million in settlements related to abuse cases.
"This settlement represents our commitment to healing and justice for survivors, while preserving our ability to serve the faithful of Long Island."
The resolution of this case could potentially provide a new framework for other Catholic dioceses facing similar legal challenges. More than two dozen Catholic dioceses have filed for bankruptcy in recent years, grappling with the financial implications of abuse claims.
A significant hurdle in reaching settlements arose from a 2024 U.S. Supreme Court ruling in the Purdue Pharma bankruptcy case. This decision limited bankruptcy courts' ability to grant legal protections to non-bankrupt entities contributing to settlement funds. In response, the Rockville Centre Diocese developed an innovative approach: all its parishes filed for bankruptcy, allowing them to gain legal protections in exchange for subjecting their assets and liabilities to court oversight.
This strategy incentivized insurers to participate in the settlement by buying back their policies from the diocese and parishes, effectively ending their responsibility for covering sex abuse claims. This approach could serve as a model for other dioceses seeking to resolve similar cases.
The diocese has implemented several measures to address the issue of sexual abuse, including a "zero tolerance" policy since 2002 and the establishment of an Independent Reconciliation and Compensation Program in 2018. These efforts, combined with the current settlement, represent significant steps towards addressing the painful legacy of abuse within the church.
As the eighth-largest diocese in the United States by population, Rockville Centre's resolution of this case is likely to have far-reaching implications for the Catholic Church's ongoing efforts to address historical abuse cases and provide justice for survivors.