Legal and professional fees paid by the Catholic Diocese of Buffalo have ballooned to $12.5 million, prompting the federal judge overseeing the diocese’s Chapter 11 bankruptcy case to remark that he was puzzled over how the diocese was able to afford such costs.
“The question is, ‘Where is the money coming from for these legal fees?’” Chief Judge Carl L. Bucki of the U.S. Bankruptcy Court in the Western District of New York asked the diocese’s lawyers at a recent hearing. “I’m just having trouble discerning how an entity can be profitable after paying over $12 million in legal fees, an entity of this size.”
Bucki based his comments on the diocese’s most recent monthly operating report, for the period ending April 30, which showed a $1.7 million cumulative profit over the course of the 39 months of bankruptcy proceedings. The report also showed a monthly loss of $91,735 in April.
“I’m just perplexed at how this entity can incur these types of expenses and still be generating a profit,” said Bucki, adding that he planned to review the operating reports further and may set up a conference to discuss the matter more fully with lawyers.
More than three dozen Buffalo Diocese properties could soon be appraised for current values that ultimately may factor heavily into a settlement with sexual abuse claimants in the diocese’s Chapter 11 bankruptcy court.
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