Vermont Catholic Diocese bankruptcy lets claimants sue parish assets

A U.S. Bankruptcy Court in Burlington, presided over by Judge Heather Cooper, issued an order permitting clergy‑abuse claimants to pursue an adversary proceeding against the Vermont Roman Catholic Diocese’s parish assets. The order allows creditors to seek up to an estimated $500 million held by nearly 70 local parishes, in addition to the diocese’s higher‑level bank and building holdings.

The diocese, which entered Chapter 11 protection in the fall of 2024, argues its top‑level assets have been reduced to about $35 million after prior settlements. Claimants, representing more than 100 survivors, filed the lawsuit seeking a declaration that all parish property and possessions are available for settlement. The diocese has objected and the case may involve years of litigation and significant attorney fees. Mediation talks are scheduled for the coming week, but no further court schedule has been set.