Hopes modest on discussions in archdiocese bankruptcy

Attorneys offered moderate hope Friday for a resolution in the Archdiocese of Santa Fe Chapter 11 bankruptcy case.

The next two days of mediation, set for Monday and Tuesday, could go a long way in determining the outcome, attorneys said. But one attorney gave a different view, saying he and his clients would pursue other solutions if they aren’t satisfied with negotiations.

Attorneys met with U.S. Bankruptcy Judge David Thuma in person and by phone Friday in a 30-minute “status conference” about the case which has been going on more than three years and involves about 400 accusers who say they were victims of sexual abuse perpetrated by clergy in the Roman Catholic Church.

The archdiocese is wrestling with four insurance companies over agreements made in the mid-1990s. Both sides allege the other isn’t fulfilling its pledge on payouts. Insurance payments are widely seen as vital to a resolution.

Thomas Walker, an Albuquerque attorney for the archdiocese, told Thuma he and his client “remain optimistic that a settlement can be reached” and that he is looking forward to “wrapping it up.”

But Los Angeles attorney James Stang, who represents an influential group of accusers called the “unsecured creditors committee,” employed Walker’s terminology in conveying his doubts.

“We would like to wrap it up,” Stang said, but added he and his clients will seek alternatives if they feel the Chapter 11 bankruptcy effort hasn’t served them well.

He said “if we can’t get this done, we are going to consider” all options, “including whether this case has any viability.”

Thuma asked if it was accurate for him to think the next two days of mediation will be crucial.

“Probably everybody has their own impression,” Walker responded. He said the most recent two days of mediation sessions, in mid-March, “did not get the job done, but we are closer.” He conceded the mediation needs to not just bring parties closer, “but to get it done.”

“But everybody needs to bring everything they’ve got these next few days,” Thuma said.

Stang responded his clients are not “suffering from case fatigue” and are “not going to throw in the towel.”

“But I want you to know that they have the energy to get this done,” Stang added, referring to his clients. “It’s got to be the right [settlement] number and the other right terms and conditions.”

Thuma scheduled another status conference for April 29. The judged signed off and said: “Good luck next week.”