Roughly 600 survivors of the clergy molestation scandal that drove the New Orleans Catholic archdiocese into bankruptcy have secured the opportunity to collectively be paid $305m after attorneys for the victims and the church’s largest insurer struck a deal Monday, according to some of the lawyers.
The insurer in question, Travelers, had refused to join a proposal officially approved Monday to pay $230m to the abuse survivors to effectively wrap up a bankruptcy protection case that the US’s second-oldest archdiocese filed in May 2020.
But, after months of negotiations, Travelers agreed on Monday morning in principle to add $75m to the settlement – which was already going to be exponentially more costly than church officials initially projected to their superiors. Attorneys Richard Trahant and John Denenea, who represent more than 80 claimants of New Orleans Catholic clergy abuse, confirmed Travelers’ agreement in principle.
Grabill must approve the Travelers portion of the New Orleans Catholic archdiocese bankruptcy settlement separately from the $230m agreement she ratified Monday, Trahant and Denenea said. It wasn’t immediately clear when that might happen.
Travelers attorney Patrick Maxcy said he couldn’t comment on the deal because it had yet not been formally approved.
New Orleans’ archdiocese is one of more than 40 US Catholic institutions that have filed for bankruptcy protection in hopes of affordably dispensing with clergy abuse complaints spanning decades and confronting their respective organizations.
Prior to Monday, 28 of those cases had culminated in settlements, according to information from Penn State University’s law school.
The only one of those settlements higher than the agreement reached in New Orleans involved New York’s Rockville-Centre diocese: $323m.
Monday’s developments came after Grabill heard weeks of testimony and arguments over the fairness of the money being offered to the survivors of the New Orleans church’s decades-old abuse scandal.
The trial’s last full day of testimony on 2 December involved about 20 of those survivors delivering gut wrenching accounts of the sexual violence they endured.
Among those to testify was Linda Lee Stonebreaker – who is the daughter of late pro football player Steve Stonebreaker and has publicly recounted being age four when a suburban New Orleans priest molested her. Outside court on Monday, Stonebreaker read a short statement informing local media outlets of the Travelers agreement.
Travelers insured the New Orleans archdiocese from 1973 to 1989, when much of the abuse at the center of the church’s bankruptcy occurred. If Travelers isn’t approved to join the deal, it would have had to defend dozens of molestation lawsuits in civil court and could have been on the hook for tens – if not hundreds – of millions more in payouts.
Initially, as he wrote to global Catholic church leaders at the Vatican, Gregory Aymond, the New Orleans archbishop, believed his archdiocese could settle its bankruptcy for less than $7m – including compensation to victims.
That calculation apparently stemmed from the fact that an applicable Louisiana state law at the time prohibited survivors of long-ago childhood sexual abuse claims from pursuing civil court damages.
However, in 2021, Louisiana’s state legislature removed that prohibition and temporarily allowed the pursuit of those claims in civil court no matter how many years earlier the abuse had occurred. The state’s supreme court upheld the law as constitutional in June 2024, though allies of the archdiocese had tried to get it struck down.
Documents in the bankruptcy indicate the church had been counting on the law being struck down to drastically limit – if not altogether eliminate – its liability in the vast majority of abuse claims.
Survivors involved in the New Orleans archdiocese’s bankruptcy overwhelmingly voted in favor of the $230m settlement in late October. The settlement also included reforms to how the church identifies and discloses past clergy molestation claims – and how it seeks to protect children and vulnerable adults going forward.
Aymond’s successor was chosen in the fall: James Checchio, the archbishop who recently arrived from the diocese of Metuchen, New Jersey. Pope Leo XIV in the fall assigned Checchio to administer the New Orleans archdiocese alongside Aymond before the latter retires in the coming months.
