Full Breakdown
Vermont Diocese Moves to Dismiss Chapter 11 Bankruptcy After Two Years
By Drooid · · How we work
Core Event
The Roman Catholic Diocese of Vermont asked a U.S. Bankruptcy Court judge to dismiss its Chapter 11 case, marking the second anniversary of the filing. The diocese has spent roughly $2 million on legal fees for the bankruptcy and its required creditor counsel. After private mediation, the diocese offered creditors a collective settlement of $29.4 million—about $247,000 per claimant—but the creditor committee rejected the proposal after learning the court may consider a separate lawsuit seeking access to an estimated $500 million in parish assets held in trusts since 2006. The diocese’s filing argues that dismissal will preserve resources and allow survivors to pursue resolution outside the costly bankruptcy process.
Background & Context
The diocese entered Chapter 11 on Sept. 30, 2024, after nearly 70 prior priest-misconduct settlements cut its cash holdings to about $35 million. More than 100 abuse claims dating back to 1950 remain unresolved. The filing was part of a broader trend: 44 U.S. Catholic entities have used Chapter 11 protection since the nationwide clergy-abuse scandal emerged in 2002.
Official Statements & Responses
Judge Heather Cooper, who set a hearing for early December, warned that without a viable reorganization plan the court could reject the diocese’s bid.
Criticism & Opposition
The creditor committee as a whole indicated it would oppose the dismissal request, arguing the move undermines accountability.
Verbatim Quotes
- “Two years ago, the diocese avoided accountability on the eve of my trial and said bankruptcy was necessary for survivors to be treated fairly,” — Daniel Stack
- “My concern is that I don’t want it all going to the professionals,” — Heather Cooper, burlington-based judge