Here come the diocese ‘bankruptcies’: How New Yorkers seeking justice under the Child Victims Act should approach new pleas of poverty
For years, we’ve fought hard for the Child Victims Act (CVA), transformative legislation that is already helping survivors secure justice while increasing transparency for the public. Both are sorely needed to end the epidemic of child sexual abuse.
In the process of passing this legislation, we heard from many large, well-funded institutions that lobbied against the legislation claiming that they’d go bankrupt if the CVA were to pass. Now that the CVA is the law, one such institution — the Rochester Diocese — has filed for bankruptcy and others may well follow. (The Rockville Center Diocese is suing to have the law overturned entirely.)
In order to truly help survivors of child sexual abuse, it’s important to get the facts straight about how bankruptcy proceedings would impact their cause.
First, the institutions that are threatening bankruptcy aren’t short of funds. The Rochester Diocese filed a federal Chapter 11 action, which exists for the purpose of protecting assets. It did not file a Chapter 7 proceeding, which occurs when an entity is broke.
In other words, the Rochester Diocese is attempting to shortchange survivors and frustrate justice. That is wrong, especially after survivors spent so long fighting in Albany for their opportunity to access justice.
Judges who oversee these cases should treat institutions filing for bankruptcy just like any other debtor by demanding absolute transparency about their holdings. Doing so will help survivors get a fair shot in court. Federal tax law permits religious entities like the Catholic Church to maintain non-profit status with the privilege of keeping their financials secret. The upshot is that many of these non-profit entities rarely disclose to the pu....