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Iowa diocese leaves bankruptcy after abuse scandal

DAVENPORT, Iowa (AP) -- The Diocese of Davenport has emerged from bankruptcy after following through with plans to pay $37 million to dozens of people who said they were sexually abused by priests and change policies to prevent future cases, church officials said Thursday.

U.S. Bankruptcy Judge Lee Jackwig last week closed the bankruptcy case, saying the diocese has substantially completed the terms of a reorganization plan and settlement approved in 2008.

The plan called for the diocese to pay $17.5 million to up to 162 victims of abuse, and its insurer to pay an additional $19.5 million. The diocese also had to take several steps to prevent sexual abuse, investigate claims and apologize to victims. One of the most visible parts of the settlement has been an online list of credible claims of abuse by priests, which lists more than 30 cases and stretches back to the 1940s.

The diocese had filed for bankruptcy protection in 2006, saying it did not have enough money to compensate victims of sexual abuse that stretched back several decades. It was one of several dioceses in the U.S. to do so in amid the abuse scandal that rocked the Catholic Church.

Bishop Martin Amos said in a statement Thursday the bankruptcy process allowed victims to receive "just and fair compensation" and the church to continue its mission throughout the diocese, which covers southeastern Iowa.

"While the bankruptcy process has closed, it will not end the suffering by some survivors of abuse. I pray that the healing process for the survivors of abuse will continue," he said.

The diocese said it would continue to mandate training for employees to prevent abuse, conduct background checks on employees and volunteers who work with children, and employ a victim assistance coordinator to help survivors of abuse.

Craig Levien, a Davenport attorney who has represented dozens of the victims, said he believed the diocese had yet to fully list all of its past perpetrators online and only reluctantly made other reforms. He said he expected to file motions in the case in the future asking a judge to review the diocese's compliance with the reorganization plan.

"The bankruptcy was a legal maneuver by the diocese to end their financial responsibility for past abuse," he said. "It's a sad chapter but it's also an unfinished chapter."

Diocese spokesman David Montgomery said two more abuse cases are under investigation, and could be made public after a review board meets next month.