Diocese of Oakland files for Chapter 11 bankruptcy

OAKLAND, Calif. – The Roman Catholic Bishop of Oakland announced Monday that the Diocese of Oakland has filed for Chapter 11 bankruptcy in light of about 330 lawsuits alleging child sexual abuse under a recent California statute that allowed decades-old cases to be reopened.

The Catholic schools that operate within the Diocese are part of separate legal entities, and were not included in the filing, according to a statement from Diocese spokesperson Helen Osman. They will continue to operate, Osman said.

Employees will continue to be paid as usual, and their benefit programs will continue uninterrupted, Osman said.

Vendors also will be paid for all their goods and services.

By filing under Chapter 11, the merits of each claim will be evaluated in a transparent process and gives the claimants a say in the outcome, Osman said. It also will stop all legal actions against the RCBO, allowing for a plan or reorganization based on assets and insurance coverage available to settle claims.

“After careful consideration of the various alternatives for providing just compensation to innocent people who were harmed, we believe this process is the best way to ensure a fair and equitable outcome for survivors,” Bishop Michael C. Barber said in a statement. “It will also allow RCBO to stabilize its finances and continue the sacred mission entrusted to us by Christ and the Church.”

Most of the claims come from allegations of sexual abuse by priests in the Diocese in the 1960s, ’70s and ’80s. The priests have either died or are not involved in the ministry anymore, according to Osman.

“It is important we take responsibility for the damage done so we can all move beyond this moment and provide survivors with some measure of peace,” Barber’s statement said. “Sadly for many, the pain caused by these horrific sins, no matter when they occurred, will never wash away, which is why we offer support to survivors and pray for their continued healing.”

The Diocese of Oakland serves 550,000 Catholics in the East Bay.