National News

Sacramento Latest California Diocese to File for Bankruptcy

The offices of the Catholic Diocese of Sacramento are seen in Sacramento, Calif., Monday, June 5, 2023. (Photo: Tran Nguyen/AP.)

PROSPECT HEIGHTS — Facing more than 250 lawsuits alleging the sexual abuse of minors by clergy and other employees since the 1950’s, the Diocese of Sacramento, California, has filed for bankruptcy as a means to provide compensation to victim-survivors of the abuse.

The diocese announced the filing on April 1, about four months after Bishop Jaime Soto of Sacramento announced the diocese planned to do so. Bishop Soto said April 1 that the bankruptcy reorganization process will allow the diocese to respond to victim-survivors as equitably as possible.

“There are many victim-survivors who have long suffered from the reprehensible sins committed against them,” Bishop Soto said in a statement. “This reorganization process will allow me to respond to them as equitably as possible.”

Per the bankruptcy filing, a court will oversee the distribution of available assets to satisfy the claims against the diocese. According to court documents, the diocese has between 200 and 999 creditors, and an estimated $100 million to $500 million in assets and liabilities.

The victim-survivors of the alleged abuse will have court representation through the process, and a fund will also be established to distribute money to victim-survivors in an equitable manner. Without the bankruptcy process, the diocese said it is likely that diocesan funds would be exhausted by the first cases to proceed to trial, leaving nothing for other victim-survivors.

When the diocese announced that it planned to file bankruptcy in December, it also acknowledged that the pastoral work of the diocese will continue through the reorganization process, and that the filing allows the diocese to continue its support of parishes and charitable organizations while a settlement is reached.

Bishop Soto emphasized that the perpetrators of the abuse are solely to blame for the diocese’s current situation.

“It is the sickening sin of sexual abuse — and the failure of Church leadership to address it appropriately — that brought us to this place. I must atone for these sins,” Bishop Soto said. “Join me in praying for the healing of victim-survivors. The pain inflicted on them lasts a lifetime, and so our atonement must be a lifetime commitment.”

The hundreds of lawsuits the Diocese of Sacramento faces stem from California legislation AB 218, which eliminated the statute of limitations for any claims of sexual abuse of a minor for three years, from Jan. 1, 2020, to Dec. 31, 2022. The legislation, and others like it that have been enacted nationwide, have led to a number of dioceses turning to a bankruptcy filing to try to address the lawsuits filed against them.

In California, the Archdiocese of San Francisco, and the Dioceses of Oakland, San Diego, and Santa Rosa have all filed for bankruptcy in recent years due to the legislation. 

Other California dioceses have previously said they have no plans to file for bankruptcy, despite lawsuits against them. There have been an estimated 3,000 lawsuits filed against the Church in California since the legislation was passed.