The Diocese of Stockton is considering filing for
bankruptcy after years of paying millions of dollars to settle child
sex abuse lawsuits.
"We pretty much have
depleted the resource funds that we have," said Sister Terry Davis, a
spokeswoman for the diocese that oversees Catholic parishes in San
Joaquin, Stanislaus, Calaveras and Tuolumne counties.
"And at this point, everything is on the table for consideration," she said.
Talk of bankruptcy surfaced during negotiations
of a lawsuit that was settled Monday for $1.75 million involving
notorious defrocked priest Oliver O'Grady.
The
plaintiff in the case, known as John J.S. Doe, filed suit in 2009 in
Stanislaus County Superior Court. He was a victim of O'Grady in the
1980s, according to the diocese.
O'Grady, who
has admitted to sexually abusing 25 children, has left a path of legal
claims against the diocese since being criminally convicted in 1993 for
molesting two Turlock brothers.
The diocese
paid $7 million to the brothers, John and James Howard, in a subsequent
civil suit and millions more in settling complaints that followed.
Davis
said the diocese is not disclosing the total amount of damages the
diocese has paid in settling sex abuse cases at this time.
By December 2010, according to a Modesto Bee article, the diocese had settled 22 civil lawsuits at a cost of $18.7 million.
More such civil cases have been dismissed with agreements since then.
And
complaints continue to surface years after O'Grady was defrocked and
deported to his native Ireland after serving a prison sentence.
A
man identified in court papers with the fictitious name John Be Doe -
the court allows plaintiffs in sex abuse cases to use such names to
protect their identities - filed a complaint in San Joaquin County
Superior Court in May 2012, alleging O'Grady molested him in 1992 when
he was 5 years old. O'Grady was assigned to St. Andrew's Parish in San
Andreas at that time.
Four months later, in
September, a woman came forward saying O'Grady sexually abused her in
1991 and 1992 while she was a child parishioner of the San Andreas
church. The woman, Jane Doe 51, was 11 and 12 years old when the abuse
happened, she said.
O'Grady had been assigned
to parishes in San Joaquin, Stanislaus and Calaveras counties from the
time he arrived in 1971 until the early 1990s.
Paul
Balestracci of Neumiller & Beardslee in Stockton has said he is
representing the diocese on four child sex abuse lawsuits, including
Jane Doe 51's and two others naming O'Grady as the perpetrator.
O'Grady isn't the only priest at the center of the diocese's sex abuse scandal.
Rev.
Michael Kelly, the former pastor of St. Joachim's Church in Lockeford,
abruptly left to Ireland in the middle of a civil trial in which a
former altar boy claimed Kelly raped him.
Later
identified as Travis Trotter, he won a $3.75 million settlement from
the diocese.
Trotter said he retired as a commercial air pilot because
of psychological damage that came with retrieving repressed memories of
the abuse.
Also in September, a 24-year-old
former altar boy filed suit on claims Kelly sexually assaulted him in
the early 2000s when they both served St. Andrew's Parish. That
plaintiff, John CC Doe, said he was 12 years old at the time.
And
about six months ago, a third alleged victim of Kelly's came forward
saying he, too, was molested in the early 2000s. Referenced in court as
John MT Doe, he was 11 years old and also a member of St. Andrew's when
he says he was abused.
In Monday's settlement,
Bishop Stephen Blaire said the church will pay $875,000 to the
plaintiff, and the rest will come from insurance.
"It
is our hope that this settlement will help the victim continue to find
healing for the suffering he endured," Blaire said in the statement. "We
have tried to find resolutions to these cases that will provide some
measure of solace for victims.
"We continue to follow strict measures to ensure that we are protecting the young and the vulnerable."
The
victim's attorney, John Manly of Newport Beach, declined to comment on
details of the case, but he agreed to comment on the settlement
discussions.
"The diocese makes it sound like this was a heartfelt and purely intentional settlement on their part," Manly said. "It wasn't."
Manly
said the diocese declined a previous $1 million offer two or three
years ago and went to the state Supreme Court to have the case
dismissed.
When the plaintiff persisted with his claim, the diocese threatened his attorneys with bankruptcy, Manly said.
"This is one more example of the diocese leadership engaging in hardball legal tactics," he said.
Manly,
who also represented Trotter and is the attorney for John CC Doe's and
John MT Doe's pending cases, said he thinks it's important parishioners
know the diocese is considering filing for bankruptcy.
In
response to questions about a potential bankruptcy, Davis said no
decision has been made. "But we are assessing very carefully what our
future move will be," she said.