U.S. Bankruptcy Court Approves $121.5 Million Archdiocese of Santa Fe Plan, Settling Hundreds of Sexual Abuse Claims

(ALBUQUERQUE, N.M., Dec. 29, 2022) — A federal bankruptcy judge on Thursday approved a $121.5 million reorganization plan, ending four years of court battles.

The approved reorganization plan provides for monetary payments to nearly 400 claimants and establishes a public archive for documents showing how decades of abuse occurred in New Mexico.

James, Vernon & Weeks, P.A., together with Keeler & Keeler, LLP, in Gallup. New Mexico represented 35 survivors in the New Mexico bankruptcy.

Judge David T. Thuma, U.S. Bankruptcy Judge for the District of New Mexico, confirmed a consensual plan of reorganization, settling the sexual-abuse claims against the Archdiocese of Santa Fe, in addition to several religious orders. The settlement, approved by 99 percent of the voting survivors, provides for a payment of more than $121.5 million to a settlement trust that will be distributed to approximately 375 Survivors under a plan of reorganization. Additional funds will be distributed to survivors of abuse perpetrated by several religious orders.

The settlement will be funded by the Archdiocese, its affiliates (including parishes) and the Archdiocese’s insurance carriers. In exchange for the settlement payments, the Archdiocese will receive a discharge in bankruptcy and its affiliates, and the insurance carriers will be released of their liabilities for the sex-abuse claims. Religious order settlements will be funded by the religious orders and their respective insurance carriers. In addition to the monetary settlements, the original creditors’ committee negotiated an unprecedented non-monetary agreement with the Archdiocese to create a public archive of documents regarding the history of sexual abuse claims against the Archdiocese.

“Our long journey through the bankruptcy proceeding is nearly at an end”, said Charles Paez, Chair of the original creditors’ committee. “Tragically, some survivors who started with us have passed away but their stories and the courage they exhibited throughout their lives will be documented in the public archive at the University of New Mexico.

 “Through the hard work of the nine members of the official creditors’ committee, the Archdiocese of Santa Fe has been held accountable to Survivors. The tenacity and courage of New Mexico Survivors empowered us to reach a recommended settlement endorsed by nearly every Survivor that voted on the plan.”

“The OCC always has stood for fair compensation and transparency. The nine members of the OCC have devoted thousands of hours over four years to getting the right result for all Survivors. This case posed unique challenges, including that all but one of the settling insurance carriers had reached settlement agreements with the Archdiocese that dated back to the 1990s.

Each of the nine members of the OCC has contributed to making New Mexico a safer place for children”, said James Stang of Pachulski Stang Ziehl & Jones LLP, bankruptcy counsel to the original creditors’ committee.

For further reading:

U.S. News & World Report – US Bankruptcy Court Approves $121M Clergy Abuse Settlement