The Diocese of Camden filed for bankruptcy last week, leaving abuse settlements unpaid for about two-thirds of the alleged victims who have come forward, according to court documents.
According to the Philadelphia Inquirer, Camden’s bankruptcy declaration leaves 141 alleged victims unpaid; about two-thirds of all those who have come forward to the diocese seeking compensation. The diocese had to date paid out settlements to 71 victims.
Bishop Dennis Sullivan of Camden announced the bankruptcy decision Oct. 2, making Camden the first New Jersey diocese to file for Chapter 11.
Around the country, nearly two dozen dioceses have declared bankruptcy since 2004, including the Diocese of Rockville Centre hours before Camden.
Following Camden’s bankruptcy declaration, the remaining alleged victims – along with all of the dioceses creditors – will have a limited pot of money to draw from, and settlements will be determined by a bankruptcy court.
New laws in New York and New Jersey have created a time window for sex abuse lawsuits to be filed long after the statute of limitations had expired.
In May 2019, Gov. Phil Murphy signed into law an extension of the statute of limitations in child sex abuse cases, allowing survivors to file lawsuits until they reached the age of 55 or seven years after they became aware of the injury, whichever came later.
The legal change resulted in new lawsuits naming the Catholic dioceses in the state, with more than 50 lawsuits involving the Camden diocese. According to the diocese’ court filings, obtained by the Philadelphia Inquirer, the diocese had faced only 99 viable legal claims in all of the previous 30 years.
The five dioceses of New Jersey announced in February 2019 the creation of the Independent Victim Compensation Program (IVCP) for victims of sexual abuse as minors by clerics in the state. The Camden diocese joined the program during June 2019.
After agreeing on and receiving a settlement through the IVCP, an abuse victim cannot then pursue additional legal action against the diocese. All settlements are funded by the dioceses themselves.
In late July 2020, the Camden diocese announced that it would suspend its participation in the program, citing a “precipitous decline in revenue resulting from the COVID-19 pandemic.” Court papers show that 120 abuse claims were left unprocessed.
In its July 31 statement, the Camden diocese said it has paid financial settlements of more than $10 million to abuse victims since 1990. The diocese and its parishes and schools are separate legal entities.
