Diocese of Albany: Judge gives interim order on mediation

By Sarah Lizee

Olympia, Wash., Nov. 28 – The Roman Catholic Diocese of Albany, New York received an interim order on global mediation for a process to evaluate claims and to formulate a Chapter 11 plan, according to an order filed Tuesday with the U.S. Bankruptcy Court for the Northern District of New York.

As previously reported, the diocese said mediating the following issues will greatly assist in the process of creating a plan:

• Assessment of claim credibility and the debtor’s potential legal liability for the abuse claims;

• Insurance coverage issues including any defenses or exceptions to coverage;

• Allocation of insurance coverage among the debtor and parishes as additional insureds under the policies;

• Inclusion of the contingent, unliquidated and disputed claims in the St. Clare’s action in the event that the debtor is found to be liable to the St. Clare’s pensioners;

• Contributions by the debtor, parishes, and insurers to fund any reorganization plan;

• Terms of a consensual plan of reorganization;

• Terms of a channeling injunction to benefit any party making a substantial contribution to the plan;

• Development of a claims submission and evaluation process for a post-confirmation trust;

• Payment of claims issues including future claims of currently unknown claimants;

• Non-monetary plan provisions; and

• Establishing a contingent provision for the benefit of the St. Clare’s pensioners in the event that the debtor is found to be liable in the St. Clare’s action.

The diocese had asked that the debtors, the official committee of tort claimants, the official committee of unsecured creditors, insurers and other parties as the court directs to participate in the mediation.

The parties have until Dec. 6 to choose a mediator. If they don’t agree on a mediator by then, the court will select one. In that case, the parties will have until Dec. 13 to give the court a list of proposed mediators for the court’s consideration.

The mediation parties and mediator will mutually agree on the date for the first mediation session.

Another hearing on terms of the mediation is set for Dec. 6.

The Albany, N.Y.-based diocese filed bankruptcy on March 15, 2023 under Chapter 11 case number 23-10244.

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