ALBANY – The Roman Catholic Diocese of Albany says litigation it is facing on behalf of St. Clare’s Hospital pensioners should be allowed to move forward despite the diocese’s pending Chapter 11 bankruptcy case.
Typically, any lawsuits filed against a federal bankruptcy debtor like the diocese are paused in order for the bankruptcy plan to be be put into place.
In addition to hundreds of sex abuse lawsuits the diocese is facing and looking to settle with the alleged victims, the church is facing two lawsuits filed against it by the St. Clare’s pensioners in state Supreme Court in Schenectady, including one filed last year by state Attorney General Letitia James.
The lawsuits allege that the diocese and its top officials mismanaged the depleted pension fund of the former St. Clare’s Hospital, wiping out the retirement plans of more than 1,100 former workers. The pension fund was created in 1959, a decade after the diocese co-founded the hospital, which closed in 2008. The pension fund had its own independent board whose members included diocese officials and others aligned with the church.
It’s alleged that the diocese failed to make required annual contributions from 1999 to 2017, leading to a shortfall of tens of millions of dollars.
In a June 1 filing with the U.S. Bankruptcy Court in Albany, the diocese said that it needs the lawsuits – which have been consolidated into one for both discovery and trial – to move forward in state Supreme Court so it can understand its potential liability in the case.
The diocese filed for Chapter 11 bankruptcy protection in March, citing the amount of potential Child Victims Act claims.
The diocese said in the June 1 filing with the bankruptcy court that it could potentially owe the pensioners between $66.8 million and $73.7 million, which could make it more difficult to pay out the sex abuse lawsuit settlements.
“The…
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