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He Sued Over a Priest’s Abuse. Then the Diocese Filed for Bankruptcy.

The New York Times
By Corina Knoll
September 26, 2019

Peter Saracino was in elementary school when, he said, a priest lured him away from a swimming pool and sexually abused him inside a seminary.

He kept the secret for decades, even as his life fell apart.

“We were raised to view the priest as another Christ,” Mr. Saracino said, “so when you get raped by a priest, it’s like being raped by God himself.”

Last month, at 67 years old, Mr. Saracino filed a lawsuit against the Roman Catholic Diocese of Rochester under a new law in New York that allows victims to seek justice over sexual abuse from long ago.

He expected revelations. Instead, he said, came another betrayal.

His lawsuit and dozens of others against the diocese were supposed to play out in civil court, with the expectation that victims would learn what church leaders knew and did. But the diocese sidestepped all of that by declaring bankruptcy.

Those who had anticipated a dramatic public accounting will now see their fight for culpability swept to the sidelines under the arcane rules of bankruptcy court.

Because the focus moves to the diocese’s assets, plaintiffs will be limited when it comes to asking pointed questions of priests and obtaining sensitive documents.

The legal emphasis has shifted from the church’s failings to its finances.

“Most of us do not give a hoot about the money,” Mr. Saracino, a retired high school teacher, said. “We’re after who’s responsible, who’s accountable, which priests are still in the diocese and currently in ministry. Bishop Matano knows full well it’s going to affect the discovery phase. The cover-up is worse than the crime.”

Bishop Salvatore Matano, who oversees the Rochester diocese, said the filing of Chapter 11 bankruptcy on Sept. 12 was the best way to serve the growing number of plaintiffs.

“We really want to do the most we can,” he said. He declined to elaborate through a spokesman, who directed questions to the diocese’s website.

For some, the departure from state court is not a major setback. Jake Giovati, 30, who said he had been abused by a priest at one of the diocese’s parishes when he was about 10, said he believed the diocese was still being held to answer.

“In my mind, filing for bankruptcy is them looking at those claims and seeing them as so credible that they do not believe they could denounce those in court,” Mr. Giovati said.

But many others see the bankruptcy as a circumvention of the justice that can be delivered in civil court and in direct defiance of the state’s new Child Victims Act, which the Catholic Church spent millions of dollars trying to fight.

The act came with a one-year “look-back window” that opened on Aug. 14 and set aside the statute of limitations on sexual abuse accusations. Hundreds of lawsuits have since been filed. Now the diocese could request in bankruptcy court that the deadline to file claims be earlier than the end of the window.

“To see institutions now deviously try to make an end-run around accountability is just horrifying,” said Michael Polenberg of Safe Horizon, a nonprofit victims’ advocacy group that pushed for the law. “Survivors deserve their day in court. What we see is the diocese keeping the curtains firmly closed.”

Bankruptcy opens up financial records to the public, allows a court to take the helm, breeds a negative image and can be a drawn-out, expensive process that involves hiring financial experts and lawyers.

But Chapter 11 is usually for those with an eye toward the future. An institution can know for months or years that it plans to file and generally has insurance providers to help cover outstanding claims.

“It’s not like, ‘Well, we only raised $120 on the collection plate this week, we don’t have enough to cover the cost of the civil litigation,’” Mr. Polenberg said.

More than 20 Catholic dioceses and religious orders in the United States, including the San Diego diocese, have filed for bankruptcy over the past 15 years, according to

Rochester is the first of the eight New York dioceses to do so. Overseeing 12 counties in Western New York where more than 300,000 Catholics reside, its assets are estimated at $50 million to $100 million, while its financial liabilities are $100 million to $500 million, according to documents filed in federal bankruptcy court.

Before the filing, the Rochester diocese most likely had input from the state and national conferences of Catholic bishops, as well as from the Vatican, said Jeff Anderson, a lawyer who has represented abuse victims in numerous bankruptcy cases involving the Catholic Church.

“It’s a coordinated decision from the top down,” Mr. Anderson said. “It’s not just a little diocese saying we can’t handle this.”

Plaintiffs who have already filed cases and any forthcoming claimants will be channeled through bankruptcy court, where they become creditors eligible for a portion of a settlement fund negotiated by a committee of abuse survivors. The payout hinges on what the diocese is worth. That can get slippery.

When Cardinal Timothy M. Dolan of New York was serving as the archbishop of Milwaukee, he requested permission from the Vatican to move nearly $57 million into a cemetery trust fund, to protect the archdiocese’s money from victims demanding compensation.

And when the Archdiocese of St. Paul and Minneapolis filed for bankruptcy, its case dragged on for nearly four years, during which it was accused of hiding more than $1 billion in assets, including hastily painting over signs at cemeteries to conceal ownership. Its archbishop insisted it had disclosed all assets and was fully cooperating with the court.

“The process of bankruptcy and the activities of the church within that — hiding assets and bold-faced lying — was disgusting,” said Jim Keenan, 52, a claimant in the case.

James Stang, a lawyer who has represented creditors’ committees in more than a dozen bankruptcy cases involving Catholic dioceses, and who has been retained in the Rochester case, said victims could still find empowerment in bankruptcy court, such as the opportunity to meet with and question a bishop.

In some cases, Mr. Stang said, committees have successfully insisted that the settlement include disclosure of documents that divulge how a diocese handled sexual abuse.

When divvying up the settlement fund, various types of abuse are compared. Someone who had been penetrated would usually expect to receive more than someone who had been groped. The victim’s age at the time matters, along with the duration and frequency of the abuse and the overall effects on the person.

Rochester’s parishes are separately incorporated and should not be affected by the bankruptcy filing, according to a statement on its website. Employees and retiree benefits will continue to be paid, and donations, if made as a restricted gift, cannot be used to settle claims.

When dioceses have filed for bankruptcy in other states, they have been able to pay claims through insurers, reserves and the sale of nonsecular property, such as a chancery building or a mall, said Michael T. Pfau, a lawyer whose firm has represented child sexual abuse victims across the nation.

“It is not going to mean that there will be a wholesale sell-off of churches, hospitals, and schools,” he said. “It has never happened and it’s not going to happen in Rochester.”

Bishop Matano has framed the filing as the “fairest course of action” to address a growing pool of victims, suggesting that otherwise there would be a race to the courtroom and the first round of plaintiffs would take all of the available funds.

That is a grossly oversimplified talking point,” Mr. Pfau said. “Catholic dioceses and religious orders all over the country have resolved claims without filing for bankruptcy and they have done that through good faith negotiations with abuse survivors and their plaintiffs’ counsel.”

The Buffalo diocese has been contemplating bankruptcy, but it is a less likely path for major districts like the Archdiocese of New York, which includes Manhattan, the Bronx, Staten Island, and seven counties. In anticipation of the Child Victims Act, the archdiocese sued its insurers to compel them to cover claims, a case that is still pending.

For Mr. Saracino, who is suing the Rochester diocese, the Catholic Church can go no lower than evading transparency, which is, he said, the ultimate goal of bankruptcy.

“The thing they squander most in doing this is their moral authority,” he said. “They have none anymore.”

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