Church's bankruptcy plan nears approval.

Byline: Bill Bishop The Register-Guard

A federal judge on Wednesday set the stage for approval next month of a bankruptcy reorganization plan for the Archdiocese of Portland, which in 2004 became the first Roman Catholic diocese in the nation to file bankruptcy on the eve of trials in multimillion-dollar lawsuits alleging child sexual abuse by priests.

U.S. District Judge Robert Jones concluded that the one remaining unsettled claim against the archdiocese would cost $100,000 to settle - well below the $13.7 million set aside for unsettled claims under the proposed reorganization plan.

Jones had scheduled public "estimation hearings" for about 20 remaining child sexual abuse claims to determine whether the $13.7 million fund was adequate to cover the potential jury awards. However, after the estimation hearings that began March 13, all but one of those claims has been settled privately.

The judge did not divulge the amounts paid to claimants who settled their cases.

Because the settlement amounts are secret, it's unclear how much has been paid out in total to resolve all claims of sexual abuse.

Companies that formerly insured the archdiocese have paid out $52 million, and the archdiocese has arranged to borrow up to another $40 million to pay the costs of all claims and to reorganize.

The total payments to claimants may be disclosed in an April 10 hearing after which U.S. Bankruptcy Judge Elizabeth Perris will determine whether to approve the bankruptcy reorganization plan.

In the meantime, all parties to the bankruptcy litigation are under a gag order issued by two judges who mediated scores of settlements and helped to craft the proposed reorganization plan late last year. The order forbids any party from publicly discussing any aspect of the case.

To date, the archdiocese has settled 165 sexual abuse claims.

In court records, lawyers for some of the claimants have objected to aspects of the reorganization which prevent public airing of alleged acts of abuse and the response of church leaders to those allegations. A hearing on a request to make such records public is expected after the reorganization is approved, according to court records.

In his 15-page ruling Wednesday on the $13.7 million set-aside, Jones said all but one case, involving three claimants, has been settled.

The case - involving a child and his parents - did not include a claim of child sexual abuse. Instead, the family claimed the child was wrongfully expelled from a Catholic school. Jones agreed the child was damaged in the amount of $100,000. However, he said the parents deserve no payment.

Jones' estimation is nonbinding and made solely to help Perris and parties to the reorganization determine whether the plan is feasible.

If approved next month, the plan would allow the archdiocese to pay all pending claims without facing a legal fight about whether any of the property, schools or funds of the 124 parishes of the archdiocese may be subject to liquidation to pay claims.