Diocese of Duluth Files for Bankruptcy

Thirty lawsuits claiming clergy sex abuse against the Diocese of Duluth are being put on hold after the Diocese filed Chapter 11 Bankruptcy Monday. 

The decision to file bankruptcy comes after a Ramsey County jury awarded $8.4 million to a man who says he was molested as a boy by a priest from the Duluth Diocese. 

The Diocese of Duluth says bankruptcy is their only option after learning they are responsible for paying the millions of dollars in the clergy sex abuse case.

“this is a sad day, but it’s not without hope because that’s why the bankruptcy is there. Once you try and exhaust all the other avenues available to you, it’s there as a protection so that justice can be served and the mission of the church can go forward,” said Father james Bissonette, Vicar General of the Diocese. 

The Diocese operating budget last year was just over $3 million. 

There is insurance and some savings available, however there would be no money left for the remaining victims

“What it means is that the bankruptcy court and bankruptcy judge will l determine, once all victims are assembled, how to allocate, most equitably the resources of the diocese so that all victims will have some measure of justice,” said Bissonette. 

The bankruptcy will not impact Diocese operations.

“The diocese day-to-day operations would continue and so would the day-to-day operations of the parishes, schools and other institutions we have,” said Bissonette. 

The Duluth Diocese is the 15th one to file bankruptcy in the U.S. 

The process could take up two years, halting at least 30 lawsuits.

Attorneys for the victims are disappointed, but hopeful.

“It’s my belief that the bankruptcy process for the Diocese of Duluth will be a fair process for everyone involved,” said Attorney Mike Finnegan. 

Lawyers have also been fighting for the release of documents the Diocese has on child sex abuse.

They say the bankruptcy will not stop their fight and that victims can still come forward.

“They can still be part of the solution here, part of making sure this doesn’t happen to anyone else.  They can get help for themselves and do this in a confidential way,” said Finnegan. 

Victims have until May 26th to come forward and file a claim under the Minnesota Child Victims Act.

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