Prol praised survivors’ perseverance, saying many waited years for compensation for profound harm. He added that resolving the bankruptcy could mark a step forward in their personal recovery journeys.
A Bankruptcy Battle Marked by Appeals
Before approving the 2024 Chapter 11 plan, U.S. Bankruptcy Judge Jerrold N. Poslusny Jr. rejected three earlier versions after insurers argued their contractual rights were not protected. Some carriers contended the third modified plan stripped those rights and sought a stay.
In March 2024, Poslusny froze implementation of the plan, saying he would not allow actions that could moot insurer appeals. By late April 2025, the diocese and the survivors’ committee asked to lift the automatic stay, noting appeals were pending before the U.S. Court of Appeals for the Third Circuit and that survivors had yet to receive any distributions.
The motion detailed months of failed mediation efforts with insurers, warning that lifting the stay could send claims back to state court, where the risks of litigation might push all sides toward resolution.
Insurers Push Back, Then Reconcile
Several insurers — including Interstate Fire and Casualty, Century Indemnity and underwriters at Lloyd’s of London, known collectively as the London Market Insurers — opposed lifting the stay in May. They argued the move would not foster mediation and that the court lacked authority over issues on appeal.
