Diocese of Rockville: Hearing on committee’s dismissal motion set

By Sarah Lizee

Olympia, Wash., April 4 – The court overseeing the Roman Catholic Diocese of Rockville Centre, New York’s Chapter 11 bankruptcy case scheduled a May 16 hearing to consider a motion from the official committee of unsecured creditors seeking to have the case dismissed, according to an order filed Tuesday.

As previously reported, the committee told the U.S. Bankruptcy Court for the Southern District of New York that after nearly two and a half years in Chapter 11, the diocese has no likelihood of rehabilitation.

The diocese’s proposed plan releases its affiliates for $11.1 million, or $22,653 per filed abuse claim. Survivors won’t approve that plan, rendering it unconfirmable, the committee said.

“These affiliates (parishes and related parties that the diocese insists are all independent but for which it seeks releases) did not elect to file their own bankruptcy cases,” the group said.

“While a plan that does not contain coercive releases of those affiliates might be confirmable, the diocese refuses to propose it.”

The committee said it anticipates that the diocese will oppose a committee-sponsored plan that addresses only the diocese’s liability, needlessly expending funds and further delaying and reducing survivor recoveries.

“After all this time, the case is gridlocked with absolutely no indication of movement toward a consensual confirmable plan,” the committee said.

The group added that the estate has consistently lost over $1 million per month, primarily due to professional fees.

The estate has lost $58 million in unrestricted assets during the case.

The Rockville Centre, N.Y.-based diocese filed bankruptcy on Oct. 1, 2020 under Chapter 11 case number 20-12345.

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