In In re Archdiocese of Milwaukee, (ED WI, Oct. 29, 2012), a Wisconsin federal district court ruled on appeals of 3 claimants from orders of a bankruptcy judge relating to claims by abuse victims filed in the bankruptcy reorganization of the Catholic Archdiocese of Milwaukee. The claims generally allege that the Archdiocese knowingly allowed pedophile priests to continue in their positions without warning victims or their families. The court held that the bankruptcy court applied the correct standard in denying summary judgment on a statute of limitations defense in the claims of two victims who alleged fraud. Issues of fact remain on whether the statute has run. The court affirmed the bankruptcy court's dismissal on state statute of limitations grounds of same two claimants' failure to warn claims, saying: "The federal courts are not the appropriate forum to re-write Wisconsin tort law." The court upheld the bankruptcy court's dismissal of claims by a third victim who had settled his claims in mediation. While he alleged fraudulent statements, he did not allege he relied on them in settling.
Reporting on the decision, the Milwaukee Journal-Sentinel says that the dismissal of the claim by the victim who settled allows the Archdiocese to file similar objections to 90 other claimants in the bankruptcy proceedings. An attorney for 350 of the 574 claimants in the bankruptcy says he will now press the archdiocese to pursue coverage under two recently discovered insurance policies.
