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Sexual-Abuse Lawsuits Drive Milwaukee Archdiocese Into Bankruptcy Court

The Archdiocese of Milwaukee, which serves 644,000 Catholics in southeastern Wisconsin, filed for bankruptcy, citing lawsuits alleging sexual abuse by priests.

The petition, filed in U.S. Bankruptcy Court in Milwaukee, listed as much as $50 million in debt, not including payments that may need to be made related to personal-injury lawsuits.

“This action is occurring because priest-perpetrators sexually abused minors,” the archdiocese said in a statement on its website.

The archdiocese became at least the eighth Roman Catholic diocese in the U.S. to file for bankruptcy to settle claims from current and former parishioners who say they were sexually molested by priests.

The average payment to victims of sex abuse made in the bankruptcy cases of the dioceses of Davenport, Iowa; Spokane, Washington; Portland, Oregon; and Tucson, Arizona, was $323,000, according to court records filed by Catholic officials in Wilmington, Delaware.

Under a bankruptcy exit plan proposed by the Wilmington Diocese, officials have estimated that sex-abuse victims would split between $32.9 million and $54.9 million. That plan will be updated next week with an even higher offer, lawyers for the Wilmington Diocese said today.

The bankruptcy case is In re Catholic Archdiocese of Milwaukee, 11-20059, U.S. Bankruptcy Court, Eastern District of Wisconsin (Milwaukee).

To contact the reporter on this story: Steven Church in Wilmington, Delaware, at schurch3@bloomberg.net.

To contact the editor responsible for this story: David E. Rovella at drovella@bloomberg.net.

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