San Francisco Archdiocese Likely to Declare Bankruptcy as Clergy Sexual Abuse Lawsuits Approach Trial

The Roman Catholic Archdiocese of San Francisco expects to soon file for Chapter 11 bankruptcy protection, due to the anticipated cost of resolving hundreds of Clergy sexual abuse lawsuits brought by individuals who were assaulted and molested as children.

The Archbishop of San Francisco, Salvatore J. Cordileone, issued a statement on August 4, indicating that bankruptcy was probably the only way to resolve the claims and continue the Archdiocese’ operations, with the first trial dates set to begin soon.

“For several months now, with the assistance of our financial and legal advisors, we have been investigating the best options for managing and resolving these cases,” the archbishop wrote. “After much contemplation and prayer, I wish to inform you that a Chapter 11 bankruptcy reorganization is very likely.”

Some States Allowing Once Time-Barred Child Sexual Abuse Lawsuits

California is one of a growing number of states nationwide that have recently passed laws to temporarily or permanently set aside statute of limitation laws for survivors of child sexual abuse, allowing lawsuits to be pursued against abusers and the organizations that enabled the conduct.

While child sexual abuse statute of limitations laws have also been enacted in a number of other states, including New York, New Jersey and Louisiana, some states are still debating whether to pass similar legislation, since prior deadlines required many claims to be filed before the full breadth and scope of the clergy sexual abuse problems in the Catholic Church were understood.

Earlier this year, Maryland passed a new law completely abolishing the statute of limitations for child sexual abuse lawsuits, following the release of a similar report that highlighted decades of misconduct and cover ups in that state.

The Catholic dioceses of Maryland is expected to challenge the constitutionality of the law in state court, but hundreds of survivors are already coming forward to pursue claims and hold the church and leadership accountable for decades of covering up credible claims.

Bankruptcy May Lead to Path for Archdiocese to Settle Lawsuits

Cordileone made it clear in his statement that the Archdiocese would likely need to restructure through Chapter 11 bankruptcy, because of the anticipated costs associated with resolving hundreds of child sexual abuse lawsuits filed against various former priests and employees.

He noted that, well before other states began following suit, California first opened a temporary “window” for filing time-barred child sexual abuse lawsuits in 2003. That led to the Archdiocese reaching a $68 million settlement agreement with about 100 plaintiffs.

California passed a another measure in 2019, opening a new three-year window for such claims to be filed.

“This resulted in more than 500 civil lawsuits being filed against the Archdiocese,” Cordileone noted. “The judge assigned to us has set an imminent trial date for one of the initial cases against the Archdiocese.”

Cordileone said that if the Archdiocese goes forward with the filing, it hopes to reach a fast and fair resolution for the survivors of sexual assault and allow the Archdiocese to continue its operations.

He acknowledged the Catholic Church’s failures to handle child sex abuse incidents correctly in the past, and said he hoped the settlement agreement would bring some peace to the survivors, and would help “the Church atone for the sins of the past perpetuated by her ministers.”

Cordileone also indicated he has been devoted to making the Archdiocese safe, protecting its members, and preventing potential sexual predators from having access to children through background checks, fingerprinting, and education of both employees and volunteers who work with minors.