Sacramento Diocese Files for Bankruptcy Amid Clergy Sex Abuse Lawsuits

Catholic clergy sex abuse claims claims set to go before juries could wipe out available funds for the Diocese of Sacramento, leading it to seek protection through bankruptcy

The Diocese of Sacramento is the latest branch of the Catholic Church to declare bankruptcy under the weight of child sex abuse lawsuits, many of which involve claims that have gone unaddressed for decades.

The Bishop of Sacramento, Jaime Soto, issued a press release earlier this month, announcing that the diocese was filing for Chapter 11 Bankruptcy Protection. The filing indicates the diocese faces more than 250 child sexual assault claims by victims dating back to the 1950s, which claim the assaults were at the hands of clergy and other Catholic Church employees.

Soto indicates that the cost of resolving the lawsuits “far outstrips” the diocese’ available funds, and that the bankruptcy filing is the best way to compensate victims of the abuse.

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

Soto blamed the situation on the abusers, as opposed to a California law passed in October, which removed statute of limitations provisions preventing older civil child sex abuse lawsuits from being filed within a certain time frame. The new law went into effect on January 1.

“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 in the statement. “The pain inflicted on them lasts a lifetime, and so our atonement must be a lifetime commitment.”

Soto announced that a fund will be established to distribute compensation to those who have filed claims. He indicates that without the bankruptcy, the diocese’s funds could be wiped out by the first few claims to go to trial, leaving none for the rest.

More information on the bankruptcy filing is available at https://www.scd.org/chapter-11-bankruptcy.

Catholic Church Faces Pressure from New State Laws

Similar bankruptcies have been announced by Catholic dioceses and archdioceses nationwide in recent years, as a growing number of states pass legislation similar to California’s.

Maryland passed similar legislation in April 2023, which went into effect last October. The Maryland Child Victims Act of 2023 removed any and all statute of limitation laws on all Maryland child sex abuse lawsuits, allowing them to be filed regardless of how long ago the incidents occurred.

Since its passage, a flood of lawsuits have been filed against the Catholic church, private schools, the state’s juvenile justice system and other individuals responsible for exposing children to known sexual predators, even when the assaults occurred decades ago. However, a number of defendants are challenging the constitutionality of the Act, arguing that removing the statute of limitations violates due process protections.

The Archdiocese of Baltimore has borne the brunt of the litigation since the new law was passed, and declared Chapter 11 bankruptcy almost immediately after it went into effect.

Because victims cannot file lawsuits against the entity while it is undergoing bankruptcy proceedings, survivors only have until the end of May to file their child sex assault claim against the Archdiocese of Baltimore.

While similar statute of limitations laws have also been enacted in a number of other states, including New York, New Jersey, California and Louisiana, other states are still debating similar bills that would allow survivors to hold abusers and entities that enabled their conduct accountable.