Judge Rules Church Can Protect Funds From Abuse Settlements

Federal Judge Rudolph T. Randa issued a ruling this Wednesday that the Archdiocese of Milwaukee can legally prevent $57 million from going to settlements in the church’s ongoing sexual abuse scandals by transferring the funds into a trust fund designed for the upkeep and maintenance of Milwaukee Catholic cemeteries. The Archdiocese of Milwaukee had filed for bankruptcy largely in part due to the hefty amount the church owes in sexual abuse settlements, and the case was trying to determine if the $57 million can be included in the Church’s assets.

via Leonardo on flickr
via Leonardo on flickr

The decision was made based on legal requirements outlined by the Religious Freedom Restoration Act (RFRA) that state the government may not put a “substantial burden” on religious entities. However, the RFRA does stipulate an exception if the burden is “in furtherance of a compelling governmental interest and is the lease restrictive means of furthering that interest.” Judge Randa declared the RFRA exception not applicable for the Archdiocese of Milwaukee’s bankruptcy case because the “interests advances by the bankruptcy system are not compelling.”

Many advocates working to prevent sexual abuse within the church believe the interests in this case are very compelling. Advocates cite 45 individual priests within the Archdiocese of Milwaukee accused of committing sexual assault, with one priest accused of molesting almost 200 deaf boys.

The intentions to withhold the $57 million from sexual abuse settlements by the church stand out clearly through the words of former Archbishop, nowCardinal, Timothy Dolan in a letter he wrote to the Vatican in 2007. In the letter, one of many documents publically released in July, he states that transferring the funds into the cemetery trust fund would lead to “an improved protection of these funds from any legal claim and liability.” Dolan is also the president of United States Conference of Catholic Bishops.

The ruling dealt down by Judge Randa has serious implications for those seeking settlement money from any religious institutions in the future. In particular the decision sets a precedent for any religious organization to protect any funds they deem appropriately theirs through redistributing their assets.

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