Archdiocese of Portland files for bankruptcy because of abuse lawsuits

PORTLAND, Ore. – The Portland Archdiocese filed for bankruptcyon Tuesday because of the steep costs from clergy sex abuselawsuits, an unprecedented step that could open the Roman Catholicarchdiocese to new levels of court scrutiny.

No other American diocese has filed for bankruptcy, thoughBoston threatened to do so at the height of the abuse crisis thatbegan there two years ago.

Portland’s Chapter 11 bankruptcy filing halted the trial of alawsuit against the late Rev. Maurice Grammond, who was accused ofmolesting more than 50 boys in the 1980s. Grammond died in2002.

Plaintiffs in the two lawsuits involving Grammond have sought atotal of more than $160 million. The archdiocese and its insurersalready have paid more than $53 million over 50 years to settlemore than 130 claims by people who say they were abused bypriests.

Bud Bunce, spokesman for the archdiocese, said day-to-day churchoperations will continue as usual.

But the filing is far from everyday business-and raises concernsabout secular oversight of church affairs.

Chapter 11 bankruptcy frees an organization from the threat ofcreditors’ lawsuits while it reorganizes. However, it could alsoopen church records to public scrutiny, and could require churchleaders to cede some financial control to the courts.

Archbishop John G. Vlazny said the archdiocese tried to settlewith the plaintiffs, but could not afford their offer.

Plaintiffs’ attorney David Slader countered that the church wassimply trying to avoid the details of the lawsuits coming out incourt.

The archdiocese owns over $500 million in tax-assessedproperties, Slader said, and also has many investments, but hecould not disclose the estimated value of those due tocourt-ordered confidentiality.

Grammond served as a priest throughout the state from 1950 to1985, when he took sick leave. Allegations of sexual abuse againstGrammond were first reported in 1991, but the charges didn’t becomepublic until 1999 when a former altar boy sued him and thearchdiocese. Grammond was suspended when he refused to fullycooperate in the church investigation.

In a deposition taken before his death, Grammond said, “I’d saythese children abused me. They’d dive in my lap to get sexualexcitement.”

James Devereaux, one of the plaintiffs, said he would perseverewith the suit.

“We will continue our fight to finally get the archdiocese toaccept the sin of its crimes,” he said.

Nationwide, abuse cases are known to have cost the church morethan $650 million since 1950. Still, relatively few molestationlawsuits have actually gone to trial in the United States; manysettle beforehand.