Should the Northwest Jesuits be given bankruptcy protection?

We ask whether Northwest Jesuits be allowed bankruptcy protection against abuse lawsuits. We don't think it is a good idea to let this entity use the shelter of chapter 11.

Critics say, "Chapter 11 bankruptcy is excessively lenient in giving a needless "escape hatch" to the incompetent management of a failing company, damaging the efficiency of the economy as a whole and allowing poor managers to continue managing. It is unusual for the management of a company in Chapter 11 to be fired, as it is usually assumed that the present management team knows far more about the company and its customers than would a new set of management. These critics note that in Europe, bankruptcy law is far less lenient for failing companies."

In other words, bankruptcy in this case will encourage the church to maintain in place the priests that allowed the abuse. Bad idea.

Critics of chapter 11 say further, "A company undergoing Chapter 11 bankruptcy is effectively operating under the 'protection' of the court until it emerges, in some cases giving the bankrupt company a great advantage against its competitors, distorting the market and harming more competitive businesses."

This troubles me because it blurs the separation of church and state. If a church operates under the 'protection' of the secular court and derives therefrom advantages -- to me that suggests the state is engaged in fostering the establishment of a specific religion.

The first amendment says, "Congress shall make no law respecting an establishment of religion." Allowing a church the benefit of state protected bankruptcy violates that clause. Bad idea.

That's our Talmudic analysis of the day.
Northwest Jesuits file for bankruptcy protection

PORTLAND, Ore. (AP) — Confronted by scores of lawsuits alleging sex abuse by priests, the Jesuits of the Oregon Province have filed for Chapter 11 bankruptcy protection.

The petition was filed Tuesday in U.S. Bankruptcy Court in Portland. The province of the Roman Catholic order listed assets of less than $5 million and liabilities of almost $62 million.

"Our decision to file Chapter 11 was not an easy one, but with approximately 200 additional claims pending or threatened, it is the only way we believe that all claimants can be offered a fair financial settlement within the limited resources of the Province," The Rev. Patrick J. Lee, the current provincial, said in a statement late Tuesday.

The religious order — officially The Society of Jesus — has 10 provinces in the United States. The Oregon Province covers Oregon, Washington, Alaska, Idaho and Montana.

Many of the lawsuits involve Alaska Natives who say they were sexually abused as children while living in remote villages.

Ken Roosa, an Anchorage-based attorney who has filed claims on behalf of more than 60 Alaska Natives, said Tuesday night the Oregon Province is vastly underestimating its assets. Roosa said he believes the Oregon Jesuit province has assets of "more than a billion dollars."

The Portland-based province contends it has worked "diligently" to resolve claims of misconduct, saying it has settled more than 200 claims and paid more than $25 million to victims since 2001. That amount does not include payments made by insurers.

"Our hope is that by filing Chapter 11, we can begin to bring this sad chapter in our Province's history to an end," Lee said. "We continue to pray for all those who have been hurt by the actions of a few men, so that they can receive the healing and reconciliation that they deserve."

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