Court Allows Diocese of Camden’s Reorganization Plan to Move Forward

Breakthrough Settlement with Survivors Gets Green Light

Plan Includes a Settlement with the Diocese of Camden and Allows Survivors to Pursue Insurance Coverage

(Camden, NJ) – Today, the United States Bankruptcy Court for the District of New Jersey approved the Diocese of Camden’s Disclosure Statement over the objections of its insurers. With the approval of the Disclosure Statement, survivors with claims against the Diocese will have an opportunity to vote on the proposed Plan of Reorganization.

The proposed plan is a result of a settlement reached between the Diocese and the Committee Representing Survivors and provides that the Diocese will pay $87.5 million into a trust for survivors of sexual abuse. The plan also contains child protection protocols that the Diocese will be required to implement, including the public disclosure of names and documents about abusive priests and a policy of paying for therapy for survivors of sexual abuse. The plan provides for continued litigation against the insurance companies. The insurance companies have failed to reasonably contribute to a settlement thus far.

“The insurance companies tried to cut the survivors out. We are delighted that the court, for now, found the insurer’s objections at this stage to be meritless. Judge Jerrold Poslusny’s decision provides survivors in the Diocese of Camden the green light to make peace with the diocese and parishes. With courage, survivors forged this deal with the diocese and are now allowed to take legal action against the diocese insurance companies,” said attorney Jeff Anderson. “The reality is the insurers refuse to abide by the obligations to the diocese and the survivors. By allowing this plan to move forward, there is now a pathway that can be used to expedite cases across the East Coast where mediation has been stalled.”

The Diocese of Camden filed for Chapter 11 bankruptcy on October 1, 2020, under the mounting pressure of child sexual abuse lawsuits filed under the New Jersey Victims’ Rights Bill. The survivors worked to try to resolve the case for numerous months. Then without any input or participation from the survivors, the insurance companies and the Diocese of Camden attempted to force a resolution of the case on the survivors. On February 2, 2022, the insurance companies and the Diocese filed a plan of reorganization seeking to cut off the rights of all survivors.  The survivors fought vigorously against the insurance companies and Diocese’s efforts.  Ultimately that led to the survivors reaching a settlement with the Diocese and its parishes that would pay survivors $87.5 million, establish enhanced child protection measures in the Diocese and allow the survivors to pursue the insurance companies which refused to honor their insurance obligations. Judge Poslusny’s decision allows the agreement to go to a vote and move forward.

The Diocese of Camden settlement represents the first Diocese on the East Coast to reach a resolution with survivors in bankruptcy since New York and New Jersey enacted laws to give survivors of childhood sexual abuse the opportunity to bring a civil claim.  There are five total dioceses in New York and New Jersey that filed Chapter 11 bankruptcies – Diocese of Rochester, Diocese of Syracuse, Diocese of Buffalo, Diocese of Rockville Centre, and Diocese of Camden.

“This is a huge moment because Chapter Eleven Bankruptcies have suspended survivors’ rights to justice,” said attorney Jeff Anderson. “This decision by the court, paired with the decision of Judge Warren in the Diocese of Rochester bankruptcy case, denies attempts by the insurance companies to delay and obstruct survivors’ rights. It’s time for accountability in all dioceses across New Jersey and New York.”

Jeff Anderson & Associates represent 75 of the more than 300 survivors with claims against the Diocese of Camden.