The Catholic Diocese of Wilmington Seeks Bankruptcy Protection From Sex Abuse Damages – News Report

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The Catholic Diocese of Wilmington Inc., which has pastoral charge of 233,000 Roman Catholics, sought protection Sunday night in U.S. Bankruptcy Court in an attempt to manage the potential liability resulting from a flood of clergy sexual abuse lawsuits.

The Chapter 11 filing in U.S. Bankruptcy Court for the District of Delaware lists assets of as much as $100 million and liabilities of as much as $500 million for the nonprofit. The diocese encompasses 58 parishes, 21 missions and 27 schools in Delaware and on Maryland’s Eastern Shore. The diocese, founded in 1869 in Wilmington, has 126 diocesan priests.

“This is a painful decision, one that I had hoped and prayed I would never have to make,” Bishop W. Francis Malooly said in a statement. “However, after careful consideration and after consultation with my close advisors and counselors, I believe we have no other choice, and that filing for Chapter 11 offers the best opportunity, given finite resources, to provide the fairest possible treatment of all victims of sexual abuse by priests of our Diocese. Our hope is that Chapter 11 proceedings will enable us to fairly compensate all victims through a single process established by the Bankruptcy Court.”

With the filing, the diocese becomes the first on the East Coast to file for bankruptcy protection. It joins six other American dioceses, including the Diocese of San Diego, that have sought protection in bankruptcy under the weight of alleged clergy sex abuse claims, bankruptcy experts said.

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