New Orleans Archdiocese Faces Court Mandate to Defend Ongoing Bankruptcy Case

A federal bankruptcy judge has ordered the Archdiocese of New Orleans to appear in court and explain why its five-year-old bankruptcy case should not be dismissed, citing millions spent and a lack of progress toward a settlement. The bankruptcy, filed in 2020 to manage hundreds of sexual abuse claims, has resulted in over $41 million in legal fees and no agreement between the church and survivors. Competing settlement proposals remain far apart, with the church offering around $125,000 per claimant and survivors seeking about $2 million each. Survivors and their attorneys argue the bankruptcy has shielded church assets and delayed justice, while church officials maintain they are making progress and believe a negotiated resolution would benefit all parties. The judge’s order raises the possibility that, if dismissed, the church could face hundreds of individual lawsuits in civil court. Both sides remain at odds, with the court set to assess next steps at a hearing in June.