No settlement in Milwaukee bankruptcy case; legal fees continue to soar

September 24, 2014

Mediation talks between the Archdiocese of Milwaukee and creditors have ended without a settlement, making it seem inevitable that the costly bankruptcy case of the archdiocese will continue.

The archdiocese has now made three attempts to reach an accord with creditors-- primarily sex-abuse victims-- on appropriate compensation. Lawyers for the abuse victims are still pressing their argument that the assets of the archdiocese, which could be divided up among creditors, should include the money held in a trust fund for the archdiocesan cemeteries. That argument is one of several contentious issues still being litigated as the archdiocesan bankruptcy proceedings, which began nearly four years ago, continue in the federal courts.

The lengthy disputes have driven the legal costs of the bankruptcy case to $14 million: a sum likely to dwarf the eventual payments to sex-abuse victims. Those costs will now rise still further.

 

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Further information:

• Bankruptcy settlement talks fail between Milwaukee archdiocese, creditors (Journal-Sentinel)
• Milwaukee archdiocesan bankruptcy case sent to mediation (CWN, 7/31)
• Talks end without accord between Milwaukee archdiocese, creditors in bankruptcy case (CWN, 10/16/12)