The Diocese of Duluth has reached a settlement with the 125 people who claimed they have been abused by the organization’s priests – the diocese’s insurers will have to shoulder the brunt of the payment as a result.
The settlement deal will see the diocese pay about $40 million to abuse survivors. According to Reuters, Liberty Mutual, Continental Insurance Co and the Catholic Mutual Relief Society of America will cover $30 million of the settlement, with the remaining $10 million to be paid off by the diocese and its more than 75 parishes.
With the settlement reached, the Diocese of Duluth can adequately compensate survivors and emerge from Chapter 11 bankruptcy. According to a release from the organization, a disclosure statement and joint reorganization plan will be filed in US Bankruptcy Court in the near future.
Of the settlement amount, more than $39 million will go into a distribution trust for the abuse claimants once court proceedings conclude, Forum News Service reported. This process will take about three to four months, the law firm representing the victims said in a release.
Following the child sexual abuse lawsuits in 2015 that brought the Diocese of Duluth into insolvency, the organization in turn filed a lawsuit against its own insurers in 2016 to claim on its insurance. All five insurers have since settled with the diocese, with Liberty Mutual being the latest one to enter an agreement.
