NY Archdiocese Willing to Pay $800 Million to Settle Priest Abuse Lawsuits

Newly installed Archbishop Ronald Hicks has announced the Archdiocese’s agreement to pay some 1,300 survivors of priest sex abuse $800 million. Each survivor would received approximately $250,000. The settlement money would be held in trust until paid to survivors. The litigation that led to the settlement proposal has lasted five years after the state of New York opened its statute of limitations for civil sexual abuse claims.

In order to arrive at the $800 million, the Archdiocese has had to sell some of its vast property, including its headquarters in Manhattan acquired for $100 million by Vanbarton Group, a boutique real estate investment firm.

However, the deal must be accepted by the survivors. Attorneys for the survivors have noted that there must be unanimous agreement to accept the offer. If the deal fails, the Archdiocese may decide to file for federal bankruptcy protection as many archdioceses and dioceses across the country have chosen to do.

According to sources close to the negotiations, the settlement proposal has four main components:

1. The monetary portion would see approximately $615 million” paid in a first installment, with $185 million distributed “within approximately 15 months.
2. Survivors would also have “an opportunity to pursue recoveries from the Archdiocese of New York’s insurance companies,” with those funds, if recovered, going into a survivors’ trust.The archdiocese has been battling Chubb-affiliated insurers over policy coverage of claims in court, as insurance companies in recent years have pushed back against dioceses on the matter.
3. The Archdiocese of New York will be required to maintain their list of credibly accused clergy on their website and continue to update it with any new, substantiated abuse claims.
4. The final major stipulation was a “temporary stoppage” of “all litigation against the Archdiocese for the survivors and their counsel” to consider the terms of the proposed settlement.

While neither side is completely pleased with the settlement proposal, it is clearly a better option than federal bankruptcy. Besides, the time it takes for a bankruptcy case to resolve, it is also expensive which means survivors would most likely receive less compensation.