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ARCHDIOCESE OF NEW ORLEANS: In Chapter 11 Due to Abuse Litigation

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The Administrative Offices of the Archdiocese of New Orleans said May 1, 2020, that in order to continue effectively ministering to the needs of the church community and victims and survivors of clergy abuse, it has filed for reorganization under Chapter 11 of the Bankruptcy Code.

The move was necessitated by the growing financial strain caused by litigation stemming from decades-old incidents of clergy abuse as well as ongoing budget challenges. The unforeseen circumstances surrounding COVID-19 have added more financial hardships to an already difficult situation.

This filing only affects the Archdiocesan administrative offices housed mostly at Walmsley Ave. and Howard Ave. The Archdiocese’s action will not affect individual church parishes, their schools, schools run by the various religious orders, or ministries of the church. These offices will continue daily ministry as usual.

“Most importantly, I extend daily prayers to those who are victims and survivors. May God give you healing and renewed hope,” wrote the archbishop. In a letter to the clergy, religious, and laity of the archdiocese released today, Archbishop Gregory M. Aymond, said the voluntary filing will allow the Archdiocese to implement a financial reorganization plan that prioritizes the continuance of the ministry of Christ.

“I, along with a team of advisors, believe that reorganization will create an opportunity for us to renew our commitment to God’s people and the New Orleans community by restructuring our financials and creating a path forward in hopes that we can continue and strengthen our core mission: bringing Christ to others.”

The intention of the filing is to allow time to develop a reorganization plan detailing how available assets and insurance coverage will be used to settle outstanding claims and to negotiate reasonable settlements while enabling the administrative offices to continue and emerge better prepared for the future. This reorganization will also allow the Archdiocese to address remaining clergy abuse cases in a way that will allow funds to go directly to victims instead of funding prolonged, costly litigation.

“I strongly believe that this path will allow victims and survivors of clergy abuse to resolve their claims in a fair and timely manner,” said Archbishop Aymond. “No parish funds will be used to settle claims. It is a pastor’s responsibility to decide how parish funds should be used to support parish ministry and this process preserves that principle.”

Again, this reorganization applies only to the archdiocesan administrative offices. There is no official timetable for the reorganization, but Archbishop Aymond said he hopes to conclude this process as soon as possible. “God is faithful, and he will guide us in this process. It is my prayer that through His grace, the Archdiocese of New Orleans will emerge from this experience stronger with a renewed commitment to our mission.”

Information on the Archdiocese of New Orleans’ reorganization and a video message from Archbishop Aymond is available at http://www.nolacatholic.org/renew

About the Archdiocese of New Orleans

The Roman Catholic Church of the Archdiocese of New Orleans is a non-profit religious corporation incorporated under the laws of the State of Louisiana.

Created as a diocese in 1793, and established as an archdiocese in 1850, the Archdiocese of New Orleans has educated hundreds of thousands in its schools, provided religious services to its churches and provided charitable assistance to individuals in need, including those affected by hurricanes, floods, natural disasters, war, civil unrest, plagues, epidemics, and illness. Currently, the Archdiocese’s geographic footprint occupies over 4,200 square miles in southeast Louisiana and includes eight civil parishes — Jefferson, Orleans, Plaquemines, St. Bernard, St. Charles, St. John the Baptist, St. Tammany, and Washington.

The Roman Catholic Church for the Archdiocese of New Orleans sought Chapter 11 protection (Bankr. E.D. La. Case No. 20-10846) on May 1, 2020.

The Archdiocese was estimated to have $100 million to $500 million in assets and liabilities as of the bankruptcy filing.

The Hon. Meredith S. Grabill is the case judge.

Jones Walker LLP, led by Mark A. Mintz, R. Patrick Vance, Elizabeth J. Futrell, and Laura F. Ashley, serves as counsel to the Debtor. Donlin, Recano & Company, Inc., is the claims agent.

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