A U.S. bankruptcy judge in Albuquerque has ruled that lawyers for clergy sex abuse survivors can file lawsuits alleging the Archdiocese of Santa Fe (N.M.) fraudulently transferred an estimated $150 million in assets to parishes in an attempt to avoid bigger payouts to victims, the Albuquerque Journal reported. The decision by Judge David T. Thuma in the chapter 11 reorganization case opens the door to what could be a multimillion-dollar boon to hundreds of alleged victims. Or it could set off protracted, costly legal appeals that would tap funds that could have paid valid abuse claims. Lawyers for the 94 archdiocese parishes, several of which predate the archdiocese by many decades or even centuries, predicted at a court hearing in August that the “decimation” of certain parishes would result if the lawsuits into the transfers go forward. Judge Thuma didn’t address whether he thought the claims surrounding the transfers ultimately would succeed, but wrote in an 18-page ruling filed on Sunday that some litigation might be needed “to help the ongoing efforts to reach a global settlement in this case.” Negotiations between the parties have stalled in the nearly 2-year-old bankruptcy case, which the archdiocese filed in late 2018 to deal with a surge of claims alleging childhood sexual abuse perpetrated by priests and other clergy. An estimated $52 million has been paid in out-of-court settlements to victims in prior years.
