An
outside expert brought in to help resolve the Roman Catholic archdiocese of
New Orleans’s expensive, highly contentious
bankruptcy protection case has suggested deferring pay to all professionals involved in the matter for three months.
The move is to see if that prompts the church and clergy abuse victims to compromise on conflicting settlement proposals which are hundreds of millions of dollars apart.
If the two sides fail to reach an agreement during that period, the bankruptcy restructuring professional Mohsin “Mo” Meghji has advised the judge in charge of the case to have a special examiner investigate all of the archdiocese’s assets – including cash and real estate – and whether the church filed for chapter 11 protection “in good faith”.
Costs in the bankruptcy have soared above $40m, well over the $7.5m that the archdiocese initially estimated it would take to resolve the case shortly before filing it in 2020.
It was not immediately clear whether the US bankruptcy court judge, Meredith Grabill, would adopt Meghji’s advice, contained in a 35-page report released late on Wednesday. Grabill paid $350,000 from the archdiocese’s estate for Meghji, his M3 Partners and their frequent collaborators at the Latham & Watkins law firm to produce it.
Grabill appointed Meghji, who is based in New York City, on 21 August to assess the viability of two competing church restructuring plans drafted by the archdiocese as well as those to whom it is indebted, among them hundreds of victims of sexually abusive archdiocesan clergymen and other personnel.
Church bankruptcy attorneys are proposing to settle the case by paying about $125,000 – none from insurers – to each of more than 500 people claiming to have survived clergy abuse. In turn, the clergy abuse claimants are demanding about $2m each, the bulk of which would come from the church’s insurers.…….
https://www.theguardian.com/us-news/2024/oct/24/new-orleans-church-bankruptcy?CMP=Share_iOSApp_Other