Archdiocese Clergy Abuse: Maximizing Insurance Coverage to Ensure Survivor Restitution
November 1, 2018
In 2013, the Minnesota legislature enacted the Minnesota Child Victim's Act, which established a three-year window for survivors of child sexual abuse to file lawsuits, regardless of the applicable statute of limitations. Facing huge potential liability for allegations of clergy sexual abuse, the Archdiocese of St. Paul and Minneapolis sought bankruptcy protection in 2015. Meanwhile, over three hundred individual abuse lawsuits were commenced against over 100 parishes in the Archdiocese, before the "window" closed in May of 2016.
Maslon was appointed by the U.S. Bankruptcy Court for the District of Minnesota to serve as Special Insurance Coverage Counsel to the Parish Creditors' Committee representing the 187 parishes in the Archdiocese's Bankruptcy Reorganization, including those facing abuse lawsuits. Maslon was specifically tasked with establishing insurance coverage for the parishes under policies that dated back to the late 1940s, and securing their insurers' contributions to the settlement fund.
Nearly four years after the bankruptcy reorganization process began, the Archdiocese of St. Paul and Minneapolis reached an historic $210 million settlement with 450 victims of clergy sexual abuse—the largest of its kind in the U.S. Under the leadership of Margo Brownell, partner and head of Maslon's Insurance Coverage Group, the Maslon team was able to secure tens of millions of dollars in insurance proceeds to contribute to the Archdiocese settlement on behalf of the parishes, even though only a handful of actual insurance policies were ever found. The Maslon team's dedicated work to maximize the parishes' insurance coverage helped ensure proper restitution would be made to the survivors.
Maslon Partner Margo Brownell led the effort with key assistance from a deep bench of Maslon personnel, including: attorneys John Darda, Marty Fallon, Bryan Freeman, Mike Sheran, Jason Reed, Amy Swedberg, and Clark Whitmore; and paralegals Deb Dix and Cathy Leonard.