Santa Rosa Catholic Diocese to declare bankruptcy in advance of clergy abuse trials

The Roman Catholic Diocese of Santa Rosa plans to file for bankruptcy protection in advance of the first clergy abuse trials resulting from a three-year period that gives adult survivors of child sexual abuse in California until Dec. 31 to file civil suits related to their experiences.

Critics immediately framed the move as an effort to prevent the disclosure of sensitive, embarrassing details about priest abuse and the measures they believe church officials took to hide misdeeds over decades.

They also chastised the diocese for choosing a route that would ensure there was no settlement money left for claimants who might yet be abused or who might legally file a lawsuit after the claim deadline established by the bankruptcy court.

“It’s all done, forever,” said Patrick Wall, a former Catholic priest and monk now working out of Orange County as an investigator and advocate for Jeff Anderson & Associates, a national legal firm specializing in child sex abuse cases, many of them involving clergy. “That’s why it is such a powerful technique.”

Filing for bankruptcy would freeze at least 130 new cases involving the Santa Rosa Diocese. Those cases have already been added to a consolidated case list administered through the Alameda County courthouse, which includes lawsuits from the rest of Northern California that have been filed since the three-year window opened at the beginning of 2020.

Attorneys say many more are yet to come before the “look-back” period closes on New Year’s Eve, preventing anyone 40 or older from filing a lawsuit based on abuse that occurred when they were children.

“There will be dozens and dozens more filed,” Sacramento attorney Joseph George told The Press Democrat in an email.

The Santa Rosa Diocese has already paid about $33 million in settlements related to the clergy abuse scandal that erupted on the North Coast in the early 1990s as survivors of sexual grooming and assault at the hands of priests began coming forward around the nation.

A list kept by Santa Rosa Bishop Robert F. Vasa includes 42 former clergy who have served in the diocese dating to the late 1950s, many of whom reappear in the new cases. A small number of new names have been added, survivor advocates say.

Often the abuse had occurred decades earlier, in a church or religious camp, a school or some other venue where they were in the company of a spiritual person of rank and esteem whom they trusted.

The incidents led to significant trauma for many survivors, some of whom were completely derailed by the shame and confusion they endured as a result, and, often, by the effort of keeping it a secret over years, experts and survivors say.

That trauma and shame is why so many survivors of childhood abuse do not report misconduct within the statute of limitations for sexual offenses, though state law amended in 2019 has greatly increased the time in which survivors can come forward. They can seek damages for child sexual assault either before age 40 or within five years of discovering that psychological injury or illness resulted from childhood assault.

The same legislation opened the look-back window allowing those 40 and older to sue for abuse despite being outside the statute.

In a statement Friday in response to a Press Democrat inquiry, Vasa said he began discussing the prospect of Chapter 11 bankruptcy more than a year ago, and that it is the “inevitable result of an insurmountable number of claims” arising from the legislature’s statute of limitations waiver.

BishopBankruptcyStatement.pdf

He said more than 130 new claims had been filed dating to 1962, a “vast majority” of them from the 1970s and ‘80s.

Filing for bankruptcy achieves “two very important goals,” he wrote.

“First, it will provide a process to carefully evaluate and compensate, as fairly as possible those who have come forward with allegations of sexual abuse. Chapter 11 is a process designed to bring all parties together in one place to resolve difficult claims fairly and finally, with the supervision of the bankruptcy court,” he wrote.

It would also permit the diocese to continue its charitable works, he said.

Though the Santa Rosa Diocese oversees about 40 parishes from Petaluma to the Oregon border, Vasa noted that they will not be part of the bankruptcy process.

“The parishes and Catholic schools within our Diocese are separate civil corporations or separate ecclesial entities and should not be parties to this filing,” Vasa wrote. “There are many matters to be discerned by the bankruptcy court and so absolute certainty about the degree of participation by any other entities such as parishes and schools will be determined in the course of the proceedings.”

Two other California dioceses, San Diego and Stockton, are among at least 32 dioceses and archdioceses in the United States and its territories to have sought bankruptcy protection amid the clergy abuse scandal since 2004.

Observers have suspected the Santa Rosa Diocese would do the same after it began independently incorporating its parishes and other entities several years ago in an apparent attempt to shield them from liability related to the diocese or other churches. If accepted by a bankruptcy court, the move could also limit assets available for settlements.

“On the playing field of bankruptcy court, they think they have a better chance of playing the corporate shell game that we think they will play now with these recent formations of their sub-entities,” said Mike Reck, a California attorney with Jeff Anderson & Associates. “The reality is the organization is a top-down, military-style organization, where power flows from the top down, and money flows from the bottom up.”

Bankruptcy also would permit the diocese from disclosing potentially sensitive documents and participating in depositions that would otherwise be required in advance of trial, Reck said.

While motivated by asset protection efforts in part, “the use of bankruptcy filing by dioceses around the country is usually more driven by scandal protection,” Reck said.

By declaring bankruptcy, “Santa Rosa church officials can refuse to accept responsibility for abuse and cover-ups that occurred while they were in charge,” SNAP, or Survivors of those Abused by Priests, said in a news release. “Even worse, bankruptcy will cut off anyone who doesn’t come forward during this process.”

Law Professor and attorney Marci Hamilton, founder and chief executive officer of Child USA, said the bankruptcy proceedings will include a period during which those survivors still within the statue of limitations on their cases can file a claim and be considered for a settlement.

But once the diocese emerges from bankruptcy, it is relieved from future liabilities.

The intent to seek financial protection through bankruptcy proceedings was confirmed in an Alameda County Court hearing Wednesday by Adrienne Moran, an attorney who has long represented the Santa Rosa Diocese in clergy abuse cases.

Moran told Judge Evelio M. Grillo that the diocese “intends to file bankruptcy no later than March 1,” according to a transcript.

The first trial in the Northern California cases is to begin in mid-April.

You can reach Staff Writer Mary Callahan (she/her) at 707-521-5249 or mary.callahan@pressdemocrat.com. On Twitter @MaryCallahanB.