Major decision by abuse victims is next step in long diocese bankruptcy

One of the next major steps in the Buffalo Catholic Diocese’s bid to end nearly 900 child sexual abuse claims in federal bankruptcy court will be a vote by the abuse victims on whether to accept the terms of a $326 million settlement plan.

Members of the Official Committee of Unsecured Creditors, which negotiated the deal with the diocese and its insurers over the past six years, said this week it is the best plan that could be crafted, considering the finances and insurance coverage of the Catholic Church in Western New York.

The $326 million will include $150 million from the diocese, its parishes and schools and other affiliated Catholic entities in Western New York. The remaining $176 million will come from insurance companies.

It will be the largest settlement in a diocese bankruptcy case to date, topping a $323 million deal in 2024 between the Diocese of Rockville Centre on Long Island and abuse claimants.

If everything goes smoothly over the next few months, the vote by abuse claimants could happen sometime in the fall, clearing the way for the diocese to exit Chapter 11 bankruptcy after more than six years.

Ruth MacAlister, one of the six volunteer members of the creditors committee, said she was hopeful the longest Chapter 11 case for a U.S. diocese was nearing a conclusion.

“It’s been six-plus long years of working and frustration and ups and downs and back and forth,” MacAlister said. “Honestly, it’s been so long that it feels surreal there’s light at the end of the tunnel. It was almost like this was going to last forever – but, fortunately, not.”

For the first time since the formation of the creditors committee in 2020, its members spoke publicly about their work to get a deal that ultimately will result in payment to victims who suffered sexual abuse as children at the hands of clergy and other employees of the diocese and area Catholic parishes.

Individual payment amounts will vary by the type and duration of abuse and its effect on victims. Those payments may go out by the end of this year or by early 2027, according to attorney Steve Boyd, who represents several hundred abuse claimants.

MacAlister, a retired clinical social worker, said she was proud of the work she and other committee members did through difficult negotiations during which they were, at times, insulted, ignored and vilified.

MacAlister said she anticipated spending up to two years serving on the committee and representing the interests of abuse victims.

"I never expected six-plus years," she said.

Committee members have largely avoided making public comments during the bankruptcy because any information divulged in negotiations with the diocese and insurance companies was considered privileged and confidential.

The committee met more than 300 times over the six years, including regular weekly videoconference meetings that lasted one to three hours. The volunteers also sat in on 76 court hearings; attended 34 mediation sessions, each of which lasted as long as eight hours; and listened to more than 100 impact statements by abuse victims.

For committee members, the work often forced them to live through the trauma of their own abuse all over again.

“It was like stripping off your skin and stepping into the salty sea every damn week, because it opened the wounds, every time,” MacAlister said.

MacAlister joined fellow committee members Anne Marie Dempsey, Richard Brownell, Peter Starks, Scott Yerger and Howard Zwelling at a news conference Monday inside Boyd's Buffalo office.

Many of them said they felt the weight of representing hundreds of people who were deeply harmed by the actions of the church and its employees.

Yerger said so many abuse victims no longer are part of the Catholic Church because of what happened to them as children.

"Your faith is torn from you when something like that happens," he said. "It stays with you, forever."

Added Brownell: "The damage is permanent."

Dempsey said she often has difficulty sleeping because of what she has seen and heard from other victims of child sex abuse, combined with her own experiences as a child.

“Sometimes, being on the committee has been almost as traumatic as what happened to us when we were abused, because we’re reliving that and reliving everyone else’s trauma with them,” Dempsey said.

The next step in the diocese bankruptcy case is the filing of an amended plan of reorganization that spells out how the diocese will restructure and pay its creditors, including the abuse claimants. It also must file an amended disclosure statement, which contains detailed information about its finances. Those documents are due to be filed by Wednesday with the U.S. Bankruptcy Court for the Western District of New York.

Hearings on the disclosure statement will be followed by a vote by the abuse claimants on the reorganization plan.

Committee members said they were optimistic that abuse claimants would approve it.

Individual victims won’t get nearly the amount of money they deserve for what happened to them, “but I don’t think there’s going to be anything better,” Dempsey said. “I really think it’s the best way forward and out of this.”

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