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Panel Says Church May Try Chapter 11

Dec 5, 2002 | AP A financial panel of the Roman Catholic Archdiocese of Boston gave Cardinal Bernard Law permission today to file for bankruptcy protection as the church tries to settle potentially crippling lawsuits in the priest sex abuse scandal.

Law would need approval from the Vatican before he can proceed. It is not known when he will make the decision. No archdiocese in the United States has ever taken such a step, which would give a secular court control over its finances and open it up to unprecedented scrutiny.

The Boston archdiocese has been at the center of the abuse scandal rocking the U.S. Catholic Church since January. It is negotiating with attorneys for about 400 alleged victims over possible settlements.

"We believe a mediated resolution would be preferable to seeking Chapter 11 protection and remain hopeful that this process currently underway will be successful," archdiocese spokeswoman Donna Morrissey said. Plaintiffs attorney Jeff Newman said the threat of a Chapter 11 bid could jeopardize the talks.

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