Roman Catholic Diocese of Syracuse bankrupt in light of abuse lawsuits

By Caroline Salls

Pittsburgh, June 19 – The Roman Catholic Diocese of Syracuse, N.Y., filed Chapter 11 bankruptcy Friday in the U.S. Bankruptcy Court for the Northern District of New York.

Chief financial officer Stephen Breen said in a statement filed with the court that from the opening of the New York Child Victims Act window on Aug. 14, 2019 through the bankruptcy filing date, about 100 lawsuits have been filed against the diocese by plaintiffs who are seeking damages as a result of alleged abuse, and demand letters and/or notices have been received from other claimants who have not yet filed lawsuits.

Breen said the diocese expects as many as 150 or more individuals may assert abuse claims.

Although the diocese believes that some of these claims are covered by insurance, Breen said it expects some insurance carriers to deny or raise defenses to coverage.

“In light of the mounting costs of litigation and potential exposure to CVA claims, the diocese has determined that the prudent course of action at this time is to pursue a financial restructuring through this Chapter 11 case,” Breen said.

The diocese is seeking court approval to use the cash collateral of KeyBank, NA to pay administrative costs.

According to court documents, the diocese has $10 million to $50 million in assets and $50 million to $100 million in debt. As of Friday, the diocese said it had an estimated $37.7 million in assets and $37.8 million in debt, as well as “potential liabilities which could be in excess of tens of millions of dollars relating to contingent and unliquidated claims arising under the New York Child Victims Act.”

The diocese’s largest unsecured creditor if KeyBank, NA of Syracuse, N.Y., with a $1.26 million Payroll Protection Program Small Business Administration loan.

Bond, Schoeneck & King, PLLC is representing the diocese in its Chapter 11 case.

The Syracuse, N.Y.-based diocese’s Chapter 11 case number is 20-30663.

© 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.