Bankruptcy Judge David T. Thuma shot down a request by the Archdiocese of Santa Fe and its parishes to derail three lawsuits claiming church officials are shielding millions of dollars in assets to limit payouts to clergy sex abuse victims, the Albuquerque Journal reported. Judge Thuma will allow the three lawsuits filed by attorneys for nearly 400 victims to proceed while church lawyers appeal directly to the 10th Circuit — a protracted process that could take a year or two and cost an estimated $5 million. But it may not come to that. “The mediation process is continuing and we hope this ruling will result in getting a consensual deal done (on a settlement of the case),” said James Stang, a Los Angeles attorney representing the nearly 400 claimants who say they were abused as children by priests and other clergy in the archdiocese. Archdiocese attorney Ford Elsaesser at a hearing last week told Judge Thuma that four settlement offers had been exchanged in the past 60 days and “we’re at the narrowest gap we’ve ever been between the settlement discussions that began approximately 14 months ago.” About two-thirds of the claims are fully or partially covered by insurance, he said, but there is no such coverage for the remaining 120 or so filed in the case. Thuma’s ruling came more than two years after the archdiocese, the state’s largest, filed for chapter 11 reorganization, citing financial losses from clergy sexual abuse cases and the prospect of more being filed. Victims’ attorneys contend that, before the filing, the archdiocese transferred most of its property to its 94 parishes, with the intent “to hinder, delay, or defraud its creditors (almost entirely sex abuse claimants),” Thuma wrote in his ruling. Some of the assets were transferred to trusts or a savings and loan fund.
