The following comes from a Jan. 14 story in the Stockton Record.
The Catholic Diocese of Stockton will take the “painful but necessary” step of filing for bankruptcy Wednesday.
Four months after warning parishioners of the possibility, the diocese announced Monday that it will seek Chapter 11 protection.
Bishop Stephen Blaire said the decision was the only course open to the diocese in the wake of $32 million spent on settlements and judgments stemming from a rash of child sexual-abuse lawsuits over the past two decades.
Of that total, $14 million came directly from the diocesan budget, the balance from insurance companies.
Blaire estimated an addition $1 million had been spent in legal fees. Stockton will be the nation’s 10th diocese to file for federal bankruptcy court protection.
“Very simply, we are in this situation because of those priests in our diocese who perpetrated grave, evil acts of child sexual abuse,” the 72-year-old Blaire said. “We can never forget that those evil acts – not the victims of the abuse – are responsible for the financial difficulties we now face.”
The bankruptcy filing will take place in Sacramento at the U.S. District Court for the Eastern District of California, the same place the city of Stockton filed its Chapter 9 debt-adjustment plan 18 months ago.
Blaire said the diocese’s financial resources have been depleted and, with two legal cases pending, he and the diocese’s lawyers saw no other course open to them. Two additional lawsuits could be filed.
“I don’t know how we could resolve this without the bankruptcy process,” he said. “It is a very difficult thing. I never thought along these lines. It has forced us to take a look at everything we do, from how we are organized to the whole financial picture.”
He also pointed out that the diocese’s administrative arm – a $5 million-a-year operation – is the only entity seeking protection.
A decade ago, the diocese split off its other corporations, the individual parishes, the Catholic schools and other organizations.
The Survivors Network of those Abused by Priests was quick to respond to the Stockton Diocese announcement.
“A bishop declaring bankruptcy is a convenient, self-serving dodge,” said Newport Beach resident Joelle Casteix, Western regional director of the group. “Despite this irresponsible decision, we hope that others who saw, suspected or suffered from clergy sex crimes and cover-ups in Stockton will step forward, call police, expose wrongdoers and protect kids.”
Blaire said he expects that to happen.
“During this procedure (in federal bankruptcy court), there will be a sufficient period of time for other victims to come forward,” he said….
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