Parishioners to join bankruptcy case

PORTLAND – Around the middle of next month, thousands of Oregon households will get a letter informing them that, as parishioners of the 124 Catholic churches in Western Oregon, they are officially part of the class of defendants in the Portland Archdiocese’s bankruptcy case.

U.S. Bankruptcy Judge Elizabeth Perris formally certified the class on Friday.

The action is nearly unprecedented: Commonly, it is the plaintiffs, not the defendants, who organize as a class in civil cases.

But in this case, parishioners will argue that it is they – not the archdiocese – who own the $600 million in assets and property of the parishes.

If they lose the argument, then that money is considered fair game for the 235 men and women who have sued the church, alleging they suffered sexual abuse at the hands of priests.

In that case, the assets of the 124 parishes and three Catholic high schools in Western Oregon could be sold or mortgaged to pay the alleged victims’ claims.

But if the parishioners win, that money is off-limits to the plaintiffs; the archdiocese proper says it has only about $19 million to its name.

There are 249 claims pending against the archdiocese by people alleging they were sexually abused by priests. They are seeking more than $400 million in damages.

More than 100 cases have been settled, some dating from alleged abuse that took place as far back as 1937. Mediation is to begin on 60 more cases next month.

In July of last year, the Portland Archdiocese became the first in the nation to file for bankruptcy after victims of sexual abuse asked for hundreds of millions of dollars in compensation; the dioceses of Tucson, Ariz., and Spokane followed suit.

Included in the class are all past and present parishioners, as well as anyone who ever made a donation to a Western Oregon parish.

Three parishioners and three priests have volunteered to be the bodily representatives of the class; all class members will be invited to attend a hearing on Oct. 12 in front of Judge Perris in Portland, at which they can object to or ask questions about their class status.

In addition to the letters, over the next two months ads will be placed in the Catholic Sentinel and in newspapers across Western Oregon in an attempt to reach as many of the estimated 389,000 members of the class as possible.

The public notification campaign will probably cost the Archdiocese around $80,000, according to Howard Levine, an attorney representing the church.

Individual parishioners will not be named, and would not be held liable should they lose the argument, lawyers involved in the case said Friday.

Attorney Al Kennedy said individual defendants in theory could opt out but are unlikely to since they would be added back on as individual defendants.

Kennedy, who represents the plaintiffs, said initially only the archdiocese was named as a defendant.

“The archdiocese raised a series of defenses that we had not named all necessary parties and unless we did so, we could not get relief,” he said.

The archdiocese has claimed in the past that the parishes and churches are not separate entities, including in 1990, when it claimed that its schools, as arms of the church, should be exempt from Oregon church law. The church lost that case.