Diocese of Rockville committee files amended Chapter 11 plan

By Sarah Lizee

Olympia, Wash., Feb. 7 – The Roman Catholic Diocese of Rockville Centre, New York’s official committee of unsecured creditors amended its competing Chapter 11 plan for the diocese, according to a press release.

The committee said the amended plan includes specific proposals for enhancing the protection of children in the care of the diocese and its affiliates.

“The DRC plan, filed two weeks ago, does not contain a single proposal for improvements to the DRC child protection plan although some of the over six hundred abuse claims arose after the so-called reforms proposed by the U.S. Conference of Catholic Bishops,” the committee said in the release.

The committee also amended its plan to add a protocol for distribution of the diocese’s cash and assets that would be transferred to a settlement trust and any settlement funds from parishes and affiliates and settling insurers.

The plan offers opportunity for settlements with the diocese’s parishes and affiliates, several of which received alleged fraudulent transfers in cash and property worth hundreds of millions of dollars and many of which are individually liable for claims of survivors for hundreds of millions of dollars, the committee said.

The plan also offers opportunity for settlements with several of the diocese’s general liability carriers in amounts that are the subject of confidential mediation.

The proposed settlements include at least $301 million in cash, among other amounts.

Holders of other priority claims, secured claims and general unsecured claims will receive 100% recovery under the committee’s plan.

Abuse claims, personal injury claims, future abuse claims, abuse related contingent/reimbursement/indemnity claims and civil rights claims are impaired under the committee’s plan.

Diocese’s plan

Under the diocese's plan, the estimated total contribution from the diocese, parishes, its co-insured parties, and other ministry members has a value between $185 million and $200 million.

The diocese said these figures do not include the value of its rights against third-party insurance companies, which are also being contributed under the plan. The diocese said it continues to press for these rights in settlement negotiations for the benefit of survivors.

According to the diocese’s disclosure statement, priority claims, secured claims, lay pension claims and priest pension claims are unimpaired.

General unsecured claimholders will receive a pro rata share of the GUC plan distribution, subject to their ability to elect convenience claim treatment.

Holders of convenience claims will receive cash equal to 100% of their claims.

Abuse claims will receive distributions from the trust. The plan provides for the release of liability for the sexual abuse claims.

The Rockville Centre, N.Y.-based diocese filed bankruptcy on Oct. 1, 2020 in the U.S. Bankruptcy Court for the Southern District of New York under Chapter 11 case number 20-12345.

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