Diocese’s “Path Forward Plan” Is a Gargantuan Step Backward
(Albany, New York) – A week after the Diocese of Albany and Bishop Edward Scharfenberger announced a “Path Forward Plan” with its insurers and survivors of child sexual abuse, the Diocese has now publicly released the terms of the plan. Far from being a “path forward,” the plan is an affront to the 400-plus survivors who were sexually abused as children by clerics and other agents of the Diocese. It appears to be an effort by the Bishop to create a path that is for them, paved by them, and to their benefit.
“The Diocese’s proposal smacks of hubris,” said attorney Jeff Anderson. “The Diocese cannot strongarm the survivors as it has done for decades under the cover of New York’s harsh statute of limitations. This plan looks more like a scheme by the Bishop to stop the litigation. There is already a path moving forward toward accountability in the courtroom, which we and the survivors are eager to engage in and reach prompt resolution. This alternative plan appears to me to be a PR pretext: there is already a path.”
“The Diocese’s “Path Forward Plan” is solely in the interest of granting the Diocese the path forward of least resistance. The Diocese’s attempt to posture this proposal as a compromise, much less a generous one, is an insult to survivors,” said attorney Cynthia LaFave. “Right now, the Diocese is under pressure. For the first time, they’re being made accountable for their actions, their inaction, and the greed that fuels both. This plan is nothing more than a means to diffuse that pressure, to self-exonerate.”
The following is a summary of the key points of the Diocese’s “Path Forward Plan”:
- Survivors would be required to “stay” their lawsuits against the Diocese and affiliated entities (e.g., parishes and schools) while participating in the plan. Discovery would grind to a halt and the Diocese would not be compelled to produce information about its predators and knowledge of child sexual abuse.
- Prior to mediating, the Diocese would disclose its insurance policies, as well as financial statements for the Diocese and Diocese affiliates for the past five years. The survivors would be required to disclose “all information and documents regarding the substance of” their claims of sexual abuse. All information and documents disclosed as part of the mediation process would be subject to a confidentiality agreement prohibiting public disclosure.
- The Diocese, Diocese affiliates, insurers, and survivors would be mandated to participate in mediation with the objective of reaching an “omnibus settlement” disposing of the claims of each of the approximately 440 survivors who have sued the Diocese. The settlement would consist of a pool of money to be divided among the survivors by a claims administrator according to protocol established by the Diocese, its insurers, and survivors.
- If a settlement is reached through mediation, the insurers and Diocese would seek court approval of the settlement. Any settlement would involve a buyback of the insurance policies issued to the Diocese by the insurers.
- If the Court approves the settlement, the Diocese and its insurers would seek a “release and consent” from each survivor. By signing a “release and consent,” a survivor would agree to participate in the plan’s distribution procedures; dismiss their lawsuit with prejudice; and agree not to pursue any other claim against the Diocese, its parishes, or affiliated entities in the future. Each of the 400-plus survivors must sign a “release and consent” as a condition precedent to the plan moving forward.
- If each survivor signs a “release and consent,” a claims administrator would determine whether each survivor will receive a settlement and, if so, how much money the survivor would receive. The claims administrator’s determination regarding the amount of a survivor’s settlement “shall be final and with no right to further judicial review.”
Survivors Divested of Power Under Diocese’s Plan
The plan requires the survivors to give up their lawsuits and put their fate in the hands of a claims administrator who will determine if, and how much, they will be paid. This facet of the plan mirrors the compensation programs adopted by every Roman Catholic Diocese in New York in the few years prior to the passage of the CVA—with the notable exception of the Diocese of Albany. Although the Diocese conducted a similar plan (the Independent Mediation Assistance Program) in 2004, it declined to put on a compensation program immediately prior to the CVA taking effect in 2019.
“If the Diocese wanted to settle quickly and cheaply, it missed its opportunity,” said attorney Taylor Stippel. “The Diocese has stacked the deck against survivors for decades, but it no longer holds the cards.”
All the Benefits of Litigation and Bankruptcy—Without Any of the Accountability
Notably absent from the Diocese’s plan is any mechanism for the disclosure of information regarding the Diocese’s perpetrators and longstanding knowledge of child sexual abuse. The Diocese proposed its plan on the heels of a New York appellate court ordering that the Diocese produce the files of 48 priests listed on the Diocese’s website as having been credibly accused of child sexual abuse.
“The timing of the Diocese’s plan belies its purportedly altruistic motives,” said Stippel. “It is audacious and deplorable for the Diocese to ask for a ‘get out of jail free’ card just as the survivors are poised to unearth the truth. The Diocese does not deserve a ‘path forward’ without being subjected to the rigors of the civil discovery process and forced to own its sordid history.”
The Diocese’s plan also provides for far less disclosure of financial information than is required as part of a Chapter 11 bankruptcy proceeding. Under the Diocese’s plan, it would only be forced to produce financial statements for the Diocese and its affiliated entities for the past five years. The survivors would have no ability to scrutinize the Diocese’s assets and insurance by hiring forensic accountants, real estate appraisers, or claim valuation experts as they may do in a Chapter 11 bankruptcy proceeding.
“The Diocese says it wants to stay out of bankruptcy to avoid paying attorneys’ fees and administrative costs. What it really wants is to avoid the excavation of assets and insurance available to survivors in a bankruptcy case,” said Anderson. Anderson has represented survivors in over 10 diocesan bankruptcies nationwide and is currently working with hundreds of survivors in the Dioceses of Rochester, Buffalo, Syracuse, and Rockville Centre bankruptcy cases. “This plan asks the survivors to take the Diocese at its word, but we know that Roman Catholic dioceses simply do not come clean about their assets until they are subjected to judicial oversight and scrupulous survivor inquiry.”
Insurers Given Free Pass
Like other Roman Catholic dioceses, the Diocese of Albany maintained liability insurance dating back decades. Insurance proceeds are frequently the most significant source of survivor recovery in states that have passed laws similar to the CVA. The Diocese of Albany was insured by the same companies that issued policies to other Roman Catholic dioceses across New York and New Jersey, including London Market Insurers (“LMI”) and Interstate Fire & Casualty Company (“Interstate”). Facing an existential threat, LMI, Interstate, and other insurers have repeatedly denied and minimized their coverage responsibilities to survivors of child sexual abuse.
The Diocese’s plan includes a channeling injunction and buyback of insurance policies, cutting off survivors’ right to pursue the full value of the Diocese’s insurance policies. “This is another diabolical scheme by LMI, Interstate, and others to shortchange the survivors,” said Anderson. “The Diocese should be fighting to get the best outcome for the survivors, not colluding with the insurers to propose a process designed to let the insurers off the hook.”
“The proposal of the “Path Forward Plan” demeans and demoralizes the immense and heroic effort that survivors have put forth to hold the Diocese accountable for years upon years of inhumanity,” said attorney Cynthia LaFave. “The Diocese is seeking to absolve themselves under the guise of this proposal. Survivors won’t stand for it. We are at the precipice of the truth. We know that. The Diocese’s timing is evidence that they know it too.”