Court Approves Wilmington Diocese Plan

July 29, 2011

Wilmington, DE – Pachulski Stang Ziehl & Jones LLP, the law firm representing survivors of sexual abuse and the entire official committee of unsecured creditors (“Committee”), reports that the Catholic Diocese of Wilmington has won bankruptcy court approval of its chapter 11 bankruptcy plan.

The plan provides cutting-edge protection for children and a $77.425 million monetary settlement, to be supplemented by settlements or litigation recoveries against several religious orders.  The Committee also successfully negotiated nonmonetary provisions.  The plan intends to compensate approximately 150 abuse victims, whose molestation claims date back to the early 1960s, and to impose an outside review of all church policies, including priest education and the operation of schools within the diocese.

In confirming the plan, U.S. Bankruptcy Judge Christopher Sontchi described the case as the most difficult of his legal career.  He commended Committee counsel for its role in the case.  Pachulski Stang name partner James Stang, counsel for the Committee, thanked the abuse survivors serving on the Committee and Judge Sontchi for his management of the case.

“These victims served on the Committee at the risk of disclosing their names,” Stang said. “Reliving the experience of abuse caused them to form a ‘band of brothers and sisters.’  It was a most difficult service.  Their goal from day one was to assure the safety of future generations.  Some victims may never regain full confidence in the church.  Anyone who thinks this case provides reconciliation does not understand the nature of the abuse,” Stang added.

Pachulski Stang Ziehl & Jones, LLP has served as committee counsel in nine chapter 11 cases filed by diocese or religious orders of the Catholic Church.  

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