Just as the Roman Catholic archdiocese of New Orleans was beginning to ask victims of clergy sexual abuse to approve a settlement plan to pay them at least $180m, the church bumped up its offer to a minimum of $230m.
Survivors also retain the chance to pursue additional amounts from the archdiocese’s largest insurer, Travelers, which has held out against a settlement. But the Guardian and local reporting partner WWL Louisiana understand that the insurer is in active talks to contribute an amount of money that could substantially increase the worth of the settlement.
Monday’s higher offer was a long-rumored move by the archdiocese to appease a sizable bloc of sexual abuse victims who had been advised by their attorneys to reject the smaller offer in a voting process that runs through 29 October.
Multiple sources with knowledge of the proposal told the Guardian and its local reporting partner WWL Louisiana on Monday that $230m would come from the archdiocese, its affiliates as well as smaller insurers. The deal was announced by plaintiffs’ attorney Jeff Anderson.
The deal now on the table supersedes an earlier one that called for 660 clergy abuse claimants in the bankruptcy to get at least $180m from the US’s second-oldest Catholic archdiocese, its affiliates and its smaller insurers. That earlier proposal also projected about an additional $50m from the eventual sale of Christopher Homes, a group of archdiocesan, assisted living facilities – a pot of money that is not included in the latest settlement offer.
Attorneys representing as many as 200 of the abuse survivors – a group that does not include Anderson – said they were advising their clients to reject that earlier deal as being inadequate, believing they deserved in the neighborhood of $300m. By Monday, they were presented with a proposal adding $50m in additional archdiocesan funds not previously offered.
A number of the attorneys who had opposed the prior settlement offer say they would not advise their clients to vote in favor of settling until the church meets their desired figure.
For any settlement proposal to gain approval, two-thirds of voting claimants must approve the revised settlement proposal.
By filing for Chapter 11 bankruptcy protection on 1 May 2020, the archdiocese was able to dispose of the hundreds of clergy abuse claims facing it at once rather than individually. Paying the claims one at a time likely would be financially impossible.
The case has been markedly acrimonious. For instance, just days before the new settlement proposal guaranteeing $230m, a lawsuit asked the judge presiding over the bankruptcy – Meredith Grabill – to reject a guarantee of New Orleans archbishop Gregory Aymond’s future retirement benefits while accusing him and a high-ranking aide of having personally covered up child sexual abuse by priests and deacons.
The archdiocese responded by saying the allegations brought by attorneys for the plaintiff – Argent Institutional Trust Co, a trustee for investors who bought $41m in church bond debt back in 2017 – were baseless.
In 2022, at the archdiocese’s urging, Grabill fined attorney Richard Trahant $400,000 and expelled four of his clients from a committee of abuse survivors, just as that panel was about to start negotiating a settlement. The reason for their dismissal: Trahant had taken steps that led a high school to learn that its chaplain was an admitted child molester, leading to the priest’s removal from its campus. Grabill ruled that Trahant’s actions violated secrecy rules governing the bankruptcy.
The outcome of an appeal Trahant filed against the levy was pending as of Monday. Trahant and his co-counsel had been advising their clients to reject the church bankruptcy settlement deal put forth earlier.
Attorneys for the church and survivors have acknowledged that their settlement negotiations have been guided, in part, by a similar church bankruptcy deal approved in January 2024 for a Catholic archdiocese on Long Island, New York.
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In that deal, the archdiocese of Rockville Centre paid about $323m to roughly 600 abuse survivors.
The value of individual payouts in New Orleans is going to vary depending on an assessment conducted by an independent claims administrator as well as a trustee.
Initially, Aymond told his superiors at the Catholic church’s global headquarters in the Vatican that the archdiocese could settle the bankruptcy for as little as $7m. That belief seemingly stemmed from the fact that Louisiana state law in effect at the time prohibited molestation survivors of long ago abuse to pursue civil damages in court.
But Louisiana’s state legislature in 2021 removed that prohibition and cleared the way for molestation survivors to pursue such damages no matter how many years earlier their abuse had occurred. The state’s supreme court upheld the law as constitutional in June 2024, despite arguments to the contrary by the Roman Catholic diocese of Lafayette, about three hours west of New Orleans.
“We acknowledge the courage of the survivors who have stood against the forces of darkness,” said a statement from the Minnesota-based Anderson, who represents some of the survivors. “This is some relief, but it is far from the full satisfaction of the archdiocese’s obligations.
“This is an opportunity for the survivors to find some comfort while continuing to pursue claims against Travelers Insurance.”
