The Roman Catholic Diocese of Burlington files for bankruptcy protection

THE ROMAN CATHOLIC DIOCESE OF BURLINGTON — VERMON’T ONLY DIOCESE — FILED FOR BANKRUPTCY PROTECTION THIS WEEK, AMID A SURGE OF LAWSUITS ALLEGING DECADES-OLD SEXUAL ABUSE BY CLERGY MEMBERS.

THE DIOCESE FACED A RISE IN ALLEGATIONS AFTER THE VERMONT LEGISLATURE REMOVED THE STATUTE OF LIMITATIONS ON CHILDHOOD SEXUAL ABUSE CLAIMS IN 2019.

THE FILING HAS TEMPORARILY PAUSED DOZENS OF UNSETTLED CASES, SIGNALING THE START OF A COMPLEX FINANCIAL RESTRUCTURING PROCESS.

BISHOP JOHN MCDERMOTT INITIATED THE BANKRUPTCY PROCEEDINGS, CITING DEPLETED ASSETS AND LACK OF INSURANCE COVERAGE FOR INCOMING SETTLEMENTS.

SINCE 2006, THE DIOCESE HAS SETTLED 67 CASES, RESULTING IN $34 MILLION IN PAYOUTS TO VICTIMS. AN ADDITIONAL $20 MILLION WAS PAID OUT BETWEEN 2006 AND 2019, WITH MORE THAN 30 ACTIVE CASES STILL PENDING RESOLUTION.

THE DIOCESE HAS TAKEN SIGNIFICANT MEASURES, INCLUDING SELLING CHURCH PROPERTY AND TAPPING INTO INVESTMENTS, TO MEET SETTLEMENT OBLIGATIONS.

THERE ARE CONCERNS ABOUT THE EQUITABLE DISTRIBUTION OF THE DIOCESE’S LIMITED FUNDS AMONG SURVIVORS, AS LARGE SETTLEMENTS COULD POTENTIALLY DEPLETE RESOURCES FOR OTHER CLAIMANTS.

AN INDEPENDENT COMMITTEE’S 2019 REPORT REVEALED 40 PRIESTS WITH CREDIBLE CLAIMS OF SEXUAL ABUSE AGAINST MINORS, WITH MOST INCIDENTS OCCURRING BETWEEN 1950 AND 1980.