Diocese of Norwich committee objects to exclusivity extension motion

By Sarah Lizee

Olympia, Wash., Nov. 8 – Norwich Roman Catholic Diocesan Corp.’s, known as the Roman Catholic Diocese of Norwich, motion seeking a 120-day extension of its exclusive periods to file and solicit votes on a Chapter 11 plan drew an objection on Friday from the official committee of unsecured creditors, according to a filing with the U.S. Bankruptcy Court for the District of Connecticut.

As previously reported, the diocese asked the court to extend the plan filing period through March 12 from Nov. 12 and the solicitation period through May 11, 2022 from Jan. 11.

The committee said the motion should be denied because the diocese has “grossly mismanaged, or simply failed to manage” its bankruptcy estate and bankruptcy case.

“Such failure will be a major obstacle to a successful reorganization in this case,” the committee said in its objection.

The group said the debtors’ professionals incurred about $1.2 million in fees and expenses in the first 11 weeks of the bankruptcy case, an average of about $110,000 per week.

“Given the tasks accomplished through Sept. 30 in the case, this seems impossible,” the committee said.

The committee said that at the rate the debtor’s professionals are incurring fees, any potential distribution to creditors, who are almost exclusively survivors of sexual abuse, will be “rapidly and massively diminished.”

“This case needs to take a drastic turn to prevent that from happening,” the group said.

The committee said the debtors’ exclusivity should terminate on Nov. 12 so that the committee can file and seek confirmation of its own plan.

The Norwich, Conn.-based diocese filed bankruptcy on July 15 under Chapter 11 case number 21-20687.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.