Settlement of $37 million will end Davenport Diocese's bankruptcy

Published: 2007-12-04

DAVENPORT, Iowa (CNS) -- The Davenport Diocese has agreed to a settlement of $37 million and nonmonetary provisions to help bring closure and healing to survivors of sexual abuse. The agreement will allow the diocese to come out of bankruptcy, though it requires approval of the bankruptcy judge to take effect. Because of sex abuse lawsuits it was facing, the diocese filed for bankruptcy protection last year under Chapter 11 of the U.S. Bankruptcy Code. Chapter 11 allows an entity to reorganize. The global settlement protects all Catholic entities affiliated with the diocese -- parishes and schools included -- from liability for past cases of abuse. It also requires giving up the diocese's headquarters to help pay for it. Press releases about the settlement were distributed Dec. 3 by the diocese and by the Creditors Committee representing 156 claimants of sex abuse. Under the settlement terms, the $37 million will be paid to claimants by the diocese and its insurance carriers; an as yet undetermined amount of money also will be set aside for any future claims of abuse that occurred prior to Oct. 10, 2006.

Copyright (c) 2007 Catholic News Service /U.S. Conference of Catholic Bishops. The CNS news report may not be published, broadcast, rewritten or otherwise distributed, including but not limited to such means as framing or any other digital copying or distribution method, in whole or in part without the prior written authority of Catholic News Service .