CAMDEN, NJ — The Diocese of Camden has filed for Chapter 11 bankruptcy due to the impacts of the coronavirus and a loss of $8 million due to lawsuits over child sexual abuse, the diocese announced.
“The effects of the pandemic, which have curtailed our revenue and deeply impacted our parishioners and neighbors, were further compounded by the over $8 million we have paid out this year through the New Jersey Independent Victims Compensation Program to victims of clergy abuse, money which we have had to borrow,” the Rev. Dennis J. Sullivan said in a post on the diocese’s website. “Additionally, the recent repeal of the statute of limitations has resulted in over fifty lawsuits being filed against the diocese involving long-ago claims of abuse.”
Sullivan said the diocese could likely weather the storm if it were facing just one of those issues. The combination of the two has made that “impracticable,” Sullivan said.
Sullivan called the move a reorganization, and said it was the best soundest way to ensure those who filed abuse claims get fair compensation. It also helps to ensure the financial future of the diocese, Sullivan said.
Attorney Greg Gianforcaro told nj.com the diocese is “running from accountability.” He has partnered with the law firm that has filed more than a dozen lawsuits against clergy in the diocese.
“I take some comfort that we are not alone in making this decision, as we have seen that well-known public entities and other Catholic dioceses across the country have been forced recently to do likewise,” Sullivan said. “This decision is intended to allow for the fair compensation of the victims of abuse, the payment of debts to our creditors, and the safeguarding of the assets which make our religious, educational and social service ministries possible.”
Because the diocese is classified as a non-profit organization, it will be able to work with the courts to ensure they are able to continue the services to the community. Sullivan said the decision has no impact on the diocese’s schools, parishes or pension plans.
The diocese offers services in Atlantic, Camden, Cape May, Cumberland, Gloucester and Salem counties. It has been closed since the coronavirus pandemic broke out, but is in the planning stages of its reopening process, according to its website.