Settlement Reached in the Diocese of New Ulm Bankruptcy Case

(New Ulm, MN) – A settlement has been reached in the Diocese of New Ulm bankruptcy case, which involves 93 claimants who were sexually abused as children by clergy and others in the Diocese.

The Diocese and the Official Committee of Unsecured Creditors (“Creditors Committee”), comprised of clergy sexual abuse survivors, have reached an agreement in principle toward a resolution of the bankruptcy. The settlement calls for payment of approximately $34 million to the 93 sexual abuse claimants. The Diocese previously agreed to the release of names of credibly accused priests.

“This is a big day for the survivors,” said Jeff Anderson, attorney for many of the New Ulm survivors. “Throughout this process, all of the survivors have demonstrated tremendous courage and patience. They have advanced the child protection movement and made their communities safer for kids.”

The Creditors Committee and the Diocese will submit a Disclosure Statement and Plan of Reorganization to the United States Bankruptcy Court. These documents are subject to approval by the Bankruptcy Court. Once the documents are approved, the 93 survivors will be sent ballots and vote on the Plan. The Bankruptcy Court must then approve the Plan the survivors approve by balloting. After that, the claims are evaluated by a claims reviewer to determine award amounts.

The settlement includes a contribution of $8 million from the Diocese and its parishes with the rest of the approximately $34 million being funded by insurance carriers for the Diocese.