New Jersey Settlements

A New Jersey Catholic diocese has agreed to pay $87.5m to settle claims involving clergy sexual abuse with some 300 alleged victims. This is one of the largest cash settlements involving the Catholic Church in the US – although short of the $660m the Archdiocese of Los Angeles paid more to more than 500 victims in 2007.

The agreement between the diocese of Camden and plaintiffs was fled with the US bankruptcy court in Camden. The diocese had filed for bankruptcy following receipt of a number of lawsuits which stemmed from relaxation on the statute of limitations.

The relaxation on the law allowed victims of sexual abuse by priests to bring a claim up until the age of 55 or within seven years of when they realised that the abuse had caused them harm. The previous statute of limitations was age 30 or two years after first realising the abuse caused harm.

Although there are around 300 victims, details of the abuse have not been provided at this stage.

The diocese of Camden has issued an apology through Bishop Dennis Sullivan who stated – “I want to express my sincere apology to all those who have been affected by sexual abuse in our diocese. My prayers go out to all survivors of abuse and I pledge my continuing commitment to ensure that this terrible chapter in the history of the diocese of Camden, New Jersey, never happens again.”

Subject to approval from a judge a trust will be set up and funded over the next four years by the diocese to compensate the abuse victims who could receive up to $290,000 each. The deal also includes a provision that the diocese implements enhanced child protection measures.

The diocese said the deal calls for setting up a trust, which will be funded over four years by the diocese and “related Catholic entities” to compensate survivors of sexual abuse. Part of the deal also required maintaining or “enhancing” protocols to protect children.

The deal also paves the way for lawsuits against insurances firms that cover dioceses against charges of negligence. In previous abuse settlements with US Catholic institutions, insurers have been part of the agreement. The New Jersey deal is the first time a church abuse settlement has not included insurers, meaning the firms can be sued separately and victims can seek increased compensation.

Jeff Anderson who represents a number of the victims commented that this was “a pivot in the child protection movement” because of the potential to hold the church and their insurers to greater account.

Since the 1980s, US Catholic dioceses have reportedly amassed complaints from over 17,000 alleged victims and paid over $4bn in settlements. Clearly this figure has the potential to grow significantly with the New Jersey settlement leading a trend in that respect.

Written by Nicholas Leigh, Loss Casualty Associate at BLM (Nicholas.Leigh@blmlaw.com)