Documents filed recently in the New Orleans Roman Catholic archdiocese’s five-year bankruptcy case provide more clarity on how claims will be doled out to victims of clergy abuse if a proposed settlement is approved. Points will be assigned to each abuse claim based on the severity of the abuse and its effects on each victim’s life, but the records do not offer much clarity on how much actual money those points will be worth.
Claims that a Catholic church employee raped them will be worth twice as much money to abuse survivors as having a priest masturbate in front of them, four times more than if a cleric touched them under their clothes and seven times more than being shown pornography, according to details from a settlement disclosure statement filed and amended recently.
Coming up in October, hundreds of victims of childhood sexual abuse by clergy will get to vote to approve or reject a settlement with the US’s second-oldest archdiocese, worth between $180m and $235m.
Recent US bankruptcy court filings are bringing some of that process into focus as the church and proponents of the settlement are counting on “yes” votes from at least two-thirds of the voting survivors.
Many survivors say they are waiting to see what the formula means for their claim before deciding how they will vote. Attorneys representing nearly 200 survivors are already urging their clients to vote “no”, raising the real possibility that the church could be thrown out of bankruptcy with nothing to show for it after spending $50m on legal fees alone.
The survivors’ committee that negotiated the settlement selected Alexandria, Louisiana, personal injury lawyer Richard Arsenault as the abuse claims reviewer. He will consider the nature and impact of the abuse to award between zero and 100 points to each claim.
The settlement disclosure documents detail the point system: Rape is worth 75 points, oral and digital sex is 56 points, masturbation is 37 points, taking and publishing a video of abuse receives 20 points, touching under the clothes is 18 points, and touching over the clothes is 10 points. Nude images or pornography are worth 10 points, grooming counts for five points and sexually explicit statements with no physical touching receives three points.
Points can then be added for those who participated in criminal prosecution of the abuser, if they sued before the bankruptcy began and if they led efforts on behalf of other survivors. More points can be awarded based on the impact the abuse had on the victim’s behavior, academic achievement, mental health, and loss of faith and family relationships. Points can be reduced if the claimant was over 18 and consented to the sexual contact.
Survivors won’t know how much each point is worth until Arsenault is done assessing all claims. For example, if $200m is available and Arsenault hands out 20,000 total points, each point would be worth $10,000. That would make a rape case worth $750,000 before any additions or subtractions.
A maximum score of 100 points would be worth $1m – but that is only a theoretical example, and the value of each point won’t be known until all claims are reviewed.
The church and a committee negotiating on behalf of all eligible abuse survivors proposed their joint settlement plan in July. The church is in the process of selling affordable housing complexes known as Christopher Homes. And the church recently disclosed that it has received eight bids for the properties and will select the highest and best offer by 15 September.
If it receives its high-end estimate of $55m, the total settlement would be worth $235m, so the average payout for the 660 claimants would exceed $350,000.
But if two-thirds of the voting survivors vote “no”, the case would almost certainly be thrown out of bankruptcy, giving survivors a chance to pursue individual lawsuits, with the prospect of collecting millions of dollars each.
John Lousteau, a survivor who filed a lawsuit in 2021 against a Catholic religious order that’s not part of the bankruptcy case, recently won a $2.4m jury verdict. Although it’s separate from the bankruptcy case, the Lousteau verdict is viewed by many as a benchmark for what survivors could get if they are willing to spend more years in court.
The attorney who won that verdict on behalf of Lousteau, Kristi Schubert, said in a statement that the church bankruptcy’s dismissal would put “survivors right back at square one”. Her statement also brought up the possibility that the archdiocese would refile for bankruptcy and halt abuse-related litigation again before it could all be resolved individually.
Schubert said payments to survivors would start being made in the spring of 2026 if the bankruptcy settles.
In recent financial disclosures, the archdiocese considers anyone who filed a claim before 16 May 2025 to have filed it timely. It had previously argued that 250 claims filed after March 2021 were filed too late.
That appears to rebut arguments by some of the church’s creditors that as many as half of the abuse claims should be thrown out.
In addition to the bloc of survivors whose attorneys are urging “no” votes, other creditors recently joined in the criticism of the proposed settlement. A committee representing 430 commercial claims, investors who bought bond debt from the church, and even the independent US bankruptcy trustee filed their own objections to the settlement plan.
Attorneys for the bondholders even accused the church of securities fraud after the archdiocese decided not to make scheduled interest payments. The bond trustees called the plan the church filed – explaining how it would pay its bond investors – “gobbledygook.” The commercial creditors said in a filing that the proposed plan was “neither fair nor equitable” and wasn’t “proposed in good faith”.
The archdiocese is also trying to address concerns about its access to money to pay a settlement. It’s counting on as much as $60m – according to a liquidation analysis – from 147 affiliated parishes, schools and charitable organizations, which plan to file quick, two-day bankruptcies to add their money to the settlement pot and protect themselves from facing their own sexual abuse lawsuits.
And there is major uncertainty about the church’s insurance coverage. A large portion of the claims stem from abuse that happened between 1973 and 1989, when Travelers Insurance provided coverage to the church. Travelers has not agreed to settle with the church, so the settlement plan gives victims from that timeframe the option of taking their claims to court individually.
Beyond Travelers, the church is counting on $29m from insurers that did agree to settle. But $21m of that is contingent on Sparta Insurance Co making assurances in spite of financial difficulties. If Sparta can’t pay, claimants abused between 1964 and 1973 would also have the option to sue separately.
Ramon Antonio Vargas contributed reporting
