The Archdiocese of New Orleans, its Affiliates, and Certain of the Archdiocese's Insurers Agree to Pay Nearly $180 Million to Settle Sex Abuse Claims

NEW ORLEANS, May 21, 2025 /PRNewswire/ -- The Official Committee of Unsecured Creditors for the Archdiocese of New Orleans, comprised of four abuse survivors representing the interests of the survivor community, has reached a settlement with the Archdiocese, the Archdiocese's parishes and other affiliates, and certain of the Archdiocese's insurers. Under this proposed resolution, these parties will settle sex abuse claims by paying $179.2 million into a trust for the benefit of survivors—more than 20 times the Archdiocese's initial settlement estimate when its bankruptcy case was filed in May 2020. This proposed settlement remains subject to approval by the Bankruptcy Court, abuse survivors, and other Archdiocese creditors.

In addition to the monetary compensation, this settlement also includes unprecedented non-monetary provisions and procedures that will safeguard against future abuse and provide services to survivors. These provisions include a Survivors' Bill of Rights and significant changes to the Archdiocese's process for handling abuse claims. The Archdiocese of New Orleans is the first bankrupt archdiocese in the United States to commit to a statement of abuse survivors' entitlement to justice in connection with a bankruptcy plan.

These non-monetary provisions will also provide greater transparency regarding the history of abuse in the Archdiocese. The settlement's terms require the publication of perpetrator files and other abuse-related documents, which will shed light on the Archdiocese's handling of decades of clergy sex abuse. Among other improvements, the settlement will establish a public archive that will serve as a repository of the history of abuse within the Archdiocese. This public archive will be administered by a secular institution of higher learning and will be accessible to the public, as well as to academia, for research on clergy abuse in Louisiana. Finally, the site of the former Hope Haven orphanage in Marrero, Louisiana will include a new memorial to the generations of children who suffered the horrors of sexual abuse at that infamous Archdiocese facility.

Throughout the five-year bankruptcy process, the Committee has remained dedicated to achieving three key objectives: (1) providing reasonable compensation to survivors, (2) overhauling the Archdiocese's process for responding to abuse allegations, and (3) bringing enhanced transparency to the Archdiocese's history of handling abuse allegations.

The proposed settlement achieves all three goals. It will provide $179.2 million to a trust to benefit survivors—an amount that will be paid following the Archdiocese's emergence from bankruptcy. Survivors will also receive additional compensation (a) from the sale of certain Archdiocese real properties and (b) from potential litigation recoveries against the Archdiocese's last, remaining non-settling insurer. Notably, the nearly $180 million settlement will include proceeds from the sale of the former Hope Haven property—that notorious site of clergy abuse.

Jim Stang of Pachulski Stang Ziehl & Jones, LLP, who serves as co-counsel to the Committee in the Archdiocese's bankruptcy case, praised the Committee's tenacity over the last five years. "The Committee delivered on its commitment to provide survivors a settlement that provides fair compensation, transparency and, importantly, unprecedented child-protection measures," said Mr. Stang. "We look forward to working with all survivors to bring this five-year bankruptcy case to an acceptable resolution." 

SOURCE Pachulski Stang Ziehl & Jones