The Archdiocese of New Orleans has filed for bankruptcy.
The Chapter 11 reorganization was filed in the United States Bankruptcy Court for the Eastern District of Louisiana early Friday morning.
In a statement, the Archdiocese said the decision to file under Chapter 11 was “necessitated by the growing financial strain caused by litigation stemming from decades-old incidents of clergy abuse as well as ongoing budget challenges.”
The statement also noted that the COVID-19 crisis has “added more financial hardships to an already difficult situation.”
The Archdiocese said the Chapter 11 reorganization “will also allow the Archdiocese to address remaining clergy abuse cases in a way that will allow funds to go directly to victims instead of funding prolonged, costly litigation.”
In Friday’s statement, Archbishop Gregory Aymond said he believed the bankruptcy path “will allow victims and survivors of clergy abuse to resolve their claims in a fair and timely manner.”
The Survivors Network of those Abused by Priests (SNAP) criticized the bankruptcy filing by the Archdiocese.
In a statement released Friday, SNAP said, “Bankruptcy proceedings often lead to increased secrecy as church officials typically use the bankruptcy process to freeze discovery, which freezes the discovery of exactly who enabled abuse, and how.”
SNAP said the filing “will shield Aymond from being forced to testify what he and his predecessors did to empower, enable, and cover up the abuse of innocents.”
Aymond emphasized that the bankruptcy filing applies only to the administrative office of the Archdiocese, and would not affect individual churches or their schools. He said parish funds would not be used to settle claims.
“It is a pastor’s responsibility to decide how parish funds should be used to support parish ministry and this process preserves that principle,” Aymond said.
