HELENA — A federal judge ruled that 95 people can pursue sex-abuse claims in state court against an order of nuns during bankruptcy proceedings involving the Roman Catholic Diocese of Helena.
The Ursuline Sisters of the Western Province aren’t covered by an automatic stay in civil proceedings that was granted to the diocese when it filed for Chapter 11 protection, U.S. Bankruptcy Judge Terry Myers said in a Friday order.
A combined 362 plaintiffs filed two lawsuits claiming abuse by the diocese and the Ursulines between the 1940s and 1970s, when the plaintiffs were children.
The lawsuit against the order alleges that nuns and priests at the Ursuline Academy in St. Ignatius abused dozens of Native American children. The diocese is accused of covering up widespread abuse across its territory.
The diocese filed for bankruptcy protection as part of a settlement with most of the plaintiffs, which prompted the automatic stay in state court.
The diocese agreed to $15 million in compensation, at least $2.5 million for future claims, a public apology and publication of the names of abusive clergy members.
But first, the diocese, which was already in financial straits, had to file for Chapter 11 bankruptcy protection.
The Ursulines are not participating in the settlement, and the plaintiffs had asked Myers to issue an order that would allow them to continue their case.
Susan Boswell, an attorney for the Ursulines, opposed the request, saying the cases against the diocese and nuns are too closely linked, and the Ursulines have their own claims against the diocese.
Myers said it was not necessary to issue a court order allowing the plaintiffs to continue their civil lawsuit against the nuns.
The Ursulines are a non-debtor co-defendant in the bankruptcy case, and automatic stays are not extended to such defendants, Myers wrote.
There must be a separate court finding of unusual circumstances that require an injunction to stop those proceedings, Myers wrote.
The Ursulines would have to successfully argue that an injunction is warranted in their case.
Tom Johnson, an attorney for the Ursulines, has previously said the order intends to either settle with the plaintiffs or file for bankruptcy on its own.