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Abuse lawsuits force US diocese into bankruptcy

Parishioners say bishop was left with no choice

  • Joseph J. Kolb for Catholic News Service/National Catholic Reporter
  • United States
  • September 6, 2013
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When Bishop James Wall was installed by the Vatican as bishop of the diocese of Gallup in 2009, he knew there were festering issues regarding allegations of priest sex abuse, but not to the extent that has brought the sprawling Southwestern diocese to the doors of U.S. Bankruptcy Court.

At Masses throughout the diocese over the weekend, parishioners were read a letter from Wall that said in the face of insurmountable lawsuits, the diocese intends to file for Chapter 11 bankruptcy protection.

Wall set no date for the court filing in his letter. He could not be reached for comment.

Seven other U.S. dioceses have filed for bankruptcy protection in the aftermath of sexual abuse lawsuits.

"While some of the claims relate to times when the diocese had some insurance, many relate to times when the diocese does not appear to have had insurance or the insurance is limited and not likely to cover the damages for which the diocese might be found liable," Wall wrote. "Given the financial circumstances of the diocese, I have come to the conclusion that the only fair, equitable and merciful way to balance these obligations is by filing a Chapter 11 reorganization."

Merritt Selleck, a parishioner at St. John Vianney Church in Gallup, told Catholic News Service he was disappointed by the announcement but said it might be the right step to take. 

"I don't think the bishop had much of choice given the number of lawsuits the diocese is facing," Selleck said.

Full Story: Diocese of Gallup, N.M., poised to file for bankruptcy protection 

Source: National Catholic Reporter

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