Clergy sex abuse survivors reject Diocese of Rockville Centre $200M offer to settle lawsuits

Hundreds of clergy sex abuse survivors have “overwhelmingly” rejected the Diocese of Rockville Centre’s final offer of $200 million to settle their lawsuits after more than three years of bankruptcy court proceedings.

In a federal bankruptcy court filing on Friday, the diocese said it was moving to dismiss the proceedings, though it was unclear if the judge would accept the motion and what would happen next.

“The Diocese embodied its best and final offer to creditors in a proposed plan of reorganization, which included $200 million to compensate abuse claimants,” the diocese said in court papers. “Claimants have overwhelmingly voted to reject that plan, however. This chapter 11 case has run its course, and it should now be dismissed.”

The final day for voting by survivors on the proposal was Friday, and results were expected to be released on Monday. But the diocese filed its motion immediately as the voting deadline hit.

Attorneys for survivors called it a “landmark” victory, and said the church’s proposed settlement was far too little given the abuse the survivors suffered as children.

“The Diocese repeatedly threatened survivors that it would seek dismissal of the bankruptcy if survivors did not accept a woefully inadequate plan,” James Stang, the main lawyer representing the survivors committee in the proceedings, said in a prepared statement. “In rejecting the plan, survivors demonstrated strength and unity and demonstrated that they would not be intimidated by the Diocese.”

He called the landslide rejection “unprecedented in the history of chapter 11 abuse cases.”

 The diocese said in a statement late Friday night that it had “cut budgets to the bone to provide the best possible offer they could in good faith” while also continuing its Catholic mission to provide spiritual, educational and charitable support to Long Islanders.

Diocesan spokesman Sean Dolan noted the survivors committee itself had previously moved to dismiss the bankruptcy proceedings, and the diocese now expects the cases to go back to civil court.

The survivors “have chosen the path of litigation, one case at a time in New York State court,” he said. “Regrettably, this may result in little or no compensation for many survivors, the opposite of why the Diocese entered this process over three years ago.”

Some 600 survivors have filed lawsuits against the diocese. The bankruptcy proceedings have been going on for 3½ years, with a total of at least $100 million in legal fees accumulated. Attorneys for survivors have proposed a $450 million settlement.

Richard Tollner, who heads the survivors’ committee in the proceedings, said in a statement that the diocese has wasted millions of dollars that could have gone to the survivors.

“The survivors have sent a strong message to all debtors around the country who are using bankruptcy to avoid accountability before state court juries. The message is: If your plan does not have the support of the survivors’ creditors’ committee, your reorganization plan will fail,” Tollner said.

The abuse cases stem from the state 2019 Child Victims Act, which opened a one-year window — later extended to two years because of the pandemic — for childhood victims of sexual abuse to file lawsuits against perpetrators regardless of how long ago the abuse occurred.

Warning that payouts for the cases would cause financial ruin, the diocese filed for bankruptcy protection in October 2020. The cases were then moved to federal bankruptcy court.

Stang said it was not clear what will happen next. U.S. Bankruptcy Court Judge Martin Glenn could reject the diocese’s motion to dismiss the proceedings and negotiations would continue. Or he could accept it, and the cases would return to state civil court.

A court hearing on the motion is set for May 9, Stang said.