02/03/2005

By NICHOLAS K. GERANIOS  / Associated Press

A second committee of creditors has been formed in the bankruptcy of the Roman Catholic Diocese of Spokane, to satisfy complaints that the first group did not include enough victims of sexual abuse.

The new committee contains five men who have filed lawsuits against the diocese contending they were abused by priests.

The original committee now contains just three members, representing sexual abuse victims who so far have declined to sue the diocese. Two other members of the original committee have moved over to the new committee.

The Office of the U.S. Trustee made the changes on Wednesday.

"The trustee advised diocesan attorneys that the second committee had been formed because the makeup of the original, single committee left some individuals feeling disenfranchised from the process," the diocese said in a news release.

Having two committees will likely make the case more expensive for the diocese, which must pay the fees of bankruptcy lawyers representing both committees. But it should put to rest fears that the original committee was somehow influenced by the church to protect its financial interests.

The Diocese of Spokane two months ago filed for Chapter 11 bankruptcy protection, contending the lawsuits filed over alleged sexual abuse far exceeded its assets.

Victims who had filed lawsuits against the diocese were awarded two seats on the original five-member creditors' committee, filled by Mike Shea and Richard Frizzell. But they worried that the interests of victims who had filed lawsuits would be less important to the three other members, Steve Denny, Marjorie Garza and Brynne Malone.

After weeks of discord as alleged victims contended the diocese packed the committee with sympathizers — a charge the diocese denied — U.S. Trustee Ilene Lashinsky made the change.

"It's sad we've waited six weeks to get to this point, but now we can get down to business," Shea told The Spokesman-Review newspaper on Wednesday.

The other three members of the new committee are Mark Mains, William McVay and Brad Norton.

The arrangement is different from the other Catholic bankruptcies in Portland, Ore., and Tucson, Ariz., which each have one creditors' committee for victims.

The creditors' committees represent the nearly 130 people who say they were molested as children by clergy. Of those, nearly 60 alleged victims have filed lawsuits, while another 70 victims have come forward claiming abuse but have not filed lawsuits.

Alleged victims have until April 5 to file claims against the diocese.