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Diocese to pay $13.6M toward bankruptcy settlement

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By Ann McGlynn | Wednesday, December 26, 2007 11:20 PM CST | () comments

The Diocese of Davenport will pay $13.6 million toward its $37 million proposed bankruptcy settlement, newly filed diocesan financial records show.

The diocese’s insurance company, Travelers, will pay $19.5 million, diocesan attorney Dick Davidson confirmed Wednesday. The sale of the diocese’s headquarters, the St. Vincent Center, will generate an estimated $3.9 million.

Davidson declined to say how the diocese will come up with $13.6 million. While the settlement releases parishes and schools from liability, officials have said that some entities are considering contributions toward the settlement. The diocese has sold a farm and two houses it owned, including the former bishop’s home.

The settlement will be dispersed to the 156 people who filed claims in the diocese’s bankruptcy case. Most are from victims of sex abuse, dating from the 1930s through 2003. Once found valid, claims will be placed on a matrix to determine how much money each will receive. Those who choose not to be placed on the matrix can take their claim to arbitration or court.

The settlement sets aside money for victims who come forward later and lays out specific non-monetary agreements to be followed by the diocese in the years to come. Attorney fees also will be paid from the settlement.

All told, sex abuse cases in the Diocese of Davenport have cost the diocese and its insurer more than $47 million. That number includes the settlement, which will have to be approved by a bankruptcy court judge, and $10 million paid to 45 victims before the diocese filed for bankruptcy in October 2006.

The diocese’s reorganization plan, which will specifically detail how the diocese will emerge from bankruptcy, is due Jan. 31.

Davenport joined four other dioceses — in Tucson, San Diego, Spokane and Portland, Ore. — in filing for bankruptcy. It filed in October 2006 after Michl Uhde of Davenport won a $1.5 million jury verdict for abuse he suffered at the hands of the now-dead Monsignor Thomas Feeney. The diocese was set to go to trial on a second case shortly after it filed for bankruptcy protection.

Ann McGlynn can be contacted at (563) 383-2336 or amcglynn@qctimes.com.