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The Roman Catholic Bishop of Santa Rosa – Debtor, Highlighting “Benefits” of Following in Footsteps of of 31 Other Bankrupt Dioceses, Seeks Lengthy Set of Exclusivity Extensions and Anticipates Mediation

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June 2, 2023 – The Debtor filed a motion to extend the periods (for a first time) during which it has an exclusive right to file a Plan and solicit acceptances thereof, through and including January 5, 2024 and March 4, 2024, respectively [Docket No. 232]. Absent the requested relief, the Plan filing periods are scheduled to expire July 11, 2023 and September 9, 2023, respectively.

In requesting the extra exclsuive time, the Debtor notes that it is "benefiting" from the many dioceses accused before them of moral bankruptcy and an increasingly well-established "process" for seeking Chapter 11 clemency. The motion notes: "To some extent, the Debtor benefits from the experience of other dioceses who preceded the Debtor into Chapter 11. Of the approximately 32 Chapter 11 diocesan or religious organization cases filed prior to the Debtor’s filing, approximately 22 of those cases have resulted in consensually confirmed reorganization plans. In virtually all of those cases, terms for a consensual reorganization plan were reached following a mediation process in which the Debtor, Non-Debtor Entities, Insurers and the creditors’ committee representing the interests of survivors of sexual abuse participated….The Debtor is working to promote this process to determine the parties’ interests and contributions to fund a plan to obtain the greatest possible recovery for creditors. Until those issues are resolved, the Debtor will not be in a position to file a proposed reorganization plan. "

A hearing on the extension motion is scheduled for June 30, 2023.

Case Status

On March 13, 2023, the Roman Catholic Bishop of Santa Rosa (“Diocese of Santa Rosa” or the “Debtor”) filed for Chapter 11 protection noting estimated assets between $10.0mn and $50.0mn; and estimated liabilities between $10.0mn and $50.0mn.

The Extension Motion

The motion [Docket No. 232] states, “Since the Petition Date, the Debtor has been diligently working to establish itself as a debtor in possession and set the case up administratively, including: (i) completed schedules have been filed, (ii) the initial and an adjourned first meeting of creditors have been conducted, (iii) all first day motions have been granted on a final basis, with the exception of limited issues relating to the cash management motion, (iv) the Debtor’s applications to retain bankruptcy counsel and a claims and noticing agent have been approved, (v) the Debtor has filed a motion to vacate initial claims bar date, and filed with this Motion is a motion to set a new claims bar date and approve specialized claim forms and procedures for filing claims, (vi) discussions with respective counsel for the Creditors’ Committee have occurred to facilitate requests for documents and information and responses by the Debtor, (vii) counsel for the Debtor has begun discussions with counsel for insurance carriers (the ‘Insurers’) providing coverage to the Debtor.

To some extent, the Debtor benefits from the experience of other dioceses who preceded the Debtor into Chapter 11. Of the approximately 32 Chapter 11 diocesan or religious organization cases filed prior to the Debtor’s filing, approximately 22 of those cases have resulted in consensually confirmed reorganization plans. In virtually all of those cases, terms for a consensual reorganization plan were reached following a mediation process in which the Debtor, Non-Debtor Entities, Insurers and the creditors’ committee representing the interests of survivors of sexual abuse participated. The Debtor is working to promote this process to determine the parties’ interests and contributions to fund a plan to obtain the greatest possible recovery for creditors. Until those issues are resolved, the Debtor will not be in a position to file a proposed reorganization plan.

The Debtor believes that the relief requested is necessary and appropriate given the early stage of the case, the complexity of the case, the steady progress in the postpetition management of the case, and the progress toward developing a process to facilitate a plan of reorganization. The requested relief is without prejudice to: (a) Debtor’s right to seek further extensions and the rights of parties in interest with standing to oppose such requests, and (b) the rights of parties in interest with standing to seek to shorten or terminate Debtor’s exclusivity periods and Debtor’s right to oppose such requests.”

 

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The post The Roman Catholic Bishop of Santa Rosa – Debtor, Highlighting “Benefits” of Following in Footsteps of of 31 Other Bankrupt Dioceses, Seeks Lengthy Set of Exclusivity Extensions and Anticipates Mediation appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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