Winners and losers in the Milwaukee archdiocese's bankruptcy settlement

by Marie Rohde

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The Milwaukee archdiocese will emerge from bankruptcy largely intact. It did not have to sell any property and all of its parishes, schools and other entities are protected from related litigation.

In addition to the abuse claimants, there are clear winners and losers in the settlement. Except for the lawyers, all creditors will be paid up to $5,000 of their bills, losing the rest.

Related: Judge approves Milwaukee archdiocese's plan to emerge from bankruptcy

The winners are:

  • The bankruptcy lawyers -- those representing both the archdiocese and the creditors -- will receive about $20 million.
  • Another $4.5 million goes to the lawyers involved in the cemetery trust litigation that the archdiocese says should not be included in the cost of the bankruptcy.
  • Each of the parishes has been asked to contribute $2,000 to a therapy fund for abuse victims; the parishes receive immunity from future lawsuits.
  • The archdiocese will have a fresh start without debt; it sold no property to reach the settlement.

The losers are:

  • State court lawyers worked for years without pay and will receive up to 40 percent of each of their clients' settlement (most, but not all, abuse victims were represented by state lawyers). While they will receive something, they have battled in state courts for 20 years without compensation.
  • Messmer High School, an independent Catholic school that serves Milwaukee's African-American community, will lose $3.4 million in support that the archdiocese pledged when the school took over two feeder schools from the archdiocese in 2007.
  • We Energies, the provider of electrical power, will be shorted $129,437, a sum to be picked up by the other ratepayers in the area.
  • The Milwaukee Water Works will be shorted $25,589, a sum that will be paid by other users.
  • The Green Bay diocese's tribunal will lose $15,000.
  • The U.S. Conference of Catholic Bishops will be shorted $9,621.
  • A number of contractors, office suppliers and other vendors took hits of between $773 and $9,888.


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