Pope Francis May Have Just Accidentally Saved My Church… by Bankrupting it. (link)
Part One: The Bankrupting
By John Zmirak
Published on November 28, 2023
Imagine if a drug company had released a new medicine — let’s say, a vaccine — that turned out to have horrible side-effects such as (for the sake of argument) deadly myocarditis, which devastates people’s hearts.
When it came out that the drug company knew all about those side-effects, and had energetically worked to cover them up from the government and its customers, the company got sued.
Now, of course I’m not talking about Pfizer or Moderna, which were idiotically immunized from any liability for making the Dead Baby Vaccine.
No, I’m talking about a totally imaginary company, in an alternative timeline where the government didn’t exempt drug companies from liability for killing people. Let’s call it … Schmizer.
In this fantasy world, Schmizer gets hits with billions of dollars in lawsuits. If they succeed — as most of them should — it would bankrupt the global company.
But it turns out thanks to a quirk in American corporate law, pharmaceutical companies aren’t treated the same as other corporations. Each city or region’s branch of the corporation is considered legally totally independent. So each branch can pay part of the damages, then when it runs out of money simply declare bankruptcy. Schmizer Global, which is headquartered in Rome, cannot be touched. It keeps all its billions in assets, and the victims don’t get their money.
Schmizer Global chugs along as if nothing had happened.
I think you’ll agree, even if you happened to own some stock in Schmizer Global, that an injustice had been done.
The Class Action Suit Against the Vatican
Now in the above example plug in instead of “Schmizer” the Roman Catholic Church.
And plug in for “vaccine” the words “clerical sex abuse.”
And that’s what happened in the sex abuse crisis.
The Vatican was able to claim that it didn’t actually control the sex abuse policies, or even the leadership, of Catholic churches in the U.S. (and other countries).
Therefore it couldn’t be held legally liable for the shuffling of thousands of priests who abused adolescent (and pre-adolescent) boys in thousands of parishes worldwide.
Those dioceses could simply go bankrupt (as the Archdiocese of San Francisco just did) and the victims have no further recourse.
In 2009, a landmark class action lawsuit by victims of clerical sex abuse tried to hold “Schmizer Global” liable.
Here are some quotes from a summary of Bryan v. Holy See:
On June 4, 2004, plaintiffs, who claim to have been victims of sexual abuse by Roman Catholic clergy, filed a class action suit against the Holy See. The Holy See is both a foreign state and an unincorporated association and the central government of an international religious organization, the Roman Catholic Church. The United States has recognized the Holy See as a foreign sovereign since 1984. According to their complaint, plaintiffs consist of representatives for two separate classes.
James H. O’Bryan and Donald E. Poppe serve as the representatives of Class I, which “consists of all persons who have not previously brought claims against an agent or servant of the Defendant, Holy See, in the United States, arising out of sexual abuse he or she suffered at the hands of a Roman Catholic priest, cleric, bishop, archbishop, cardinal, agent or employee․”
Plaintiffs’ claims regarding the liability of the Holy See stem, in large part, from their allegations regarding the purported policy of the Holy See towards accusations of sexual abuse leveled against clergy:
‘[T]he Holy See has mandated that all allegations of childhood sexual abuse be kept under a cloak of complete secrecy, even if that secrecy violated state, federal, or international law. In March 1962, the Holy See privately circulated a document containing a set of procedural norms for dealing with the solicitation of sex in confession, clergy sex with minors, homosexual relations, and bestiality. This document [the “1962 Policy”] — an official legislative text issued by the Congregation of the Holy Office and specifically approved by Pope John XXIII — imposes the highest level of secrecy on the handling of clergy sexual abuse matters․
This secret document was first discovered and made public in July, 2003 by news media in the United States and throughout the world. The policies of the Holy See expressed in this and other documents require bishops in the United States to, among other things, refuse to report childhood sexual abuse committed by priests to criminal or civil authorities, even where such failure to report would itself be a criminal offense.’
The lawsuit could have bankrupted the Vatican, forcing the fire-sale of such priceless assets as the Vatican’s vast art collection, real estate portfolio, and other global investments (which include a scandal-plagued bank).
The Vatican Dodged the Bullet
Bryan v. Holy See failed for two reasons: first because the U.S. recognizes some “sovereign immunity” of foreign governments, such as that of the tiny Vatican micro-state.
The more important reason was that under U.S. law, each diocese (regional government) of the Church is considered a separate corporation, not legally subject to the Vatican.
Thus if a U.S. bishop refused to resign when the pope asked him to, he might well be able to dispute control over Church property in U.S. courts. It’s unclear how they would rule.
As analyst Benjamin Harnwell wrote:
When the 2010 suit O’Bryan vs. the Holy See sought to depose Pope Benedict XVI in a U.S. court, Vatican lawyer Jeffrey Lena employed a tightly reasoned argument before the U.S. district court in Kentucky, which hinged upon demonstrating that the Vatican was not responsible for the U.S. bishops’ policy on protecting children, and nor was it responsible for day-to-day operational policy.
Much as the Vatican deserved to pay the piper, I must confess that as a lifelong Catholic for years I was fine with the Vatican hiding behind such legal flim-flam.
I worried about the glorious temples and museums carefully curated over the centuries to the glory of almighty God getting auctioned off to the Saudis, or carted off to decorate not churches, but Vegas casinos.
At least when they hang in churches, masterpieces of sacred art are on full view for the poor — not ornamenting the harem of some Kuwaiti prince.
Pope Francis’ Blunder Could Cost Him
But Pope Francis’ brutal abuse of his power, both in the past and quite recently, may have stripped off the Church’s legal fig leaf.
Harnwell explained back in 2018:
In ordering the U.S. bishops to abstain from voting on measures aimed at addressing clerical sex abuse, Pope Francis may have inadvertently performed the most consequential and costly act of his papacy.
The U.S. Conference of Catholic Bishops (USCCB) intended to vote on two measures responding to the ongoing sex abuse crisis in its annual fall meeting, which concluded in Baltimore on Wednesday.
A last-minute intervention, however, from the Vatican’s Congregation for Bishops instructed the USCCB to stand down and to await a meeting of global episcopal conference leadership convoked by Pope Francis for February.
The Vatican’s direct intervention into the bishops’ governance would seem to undermine the Holy See’s prime pillar of legal defense when charged with negligence in dealing with sex abuse, namely, the relative independence of Catholic dioceses from Vatican oversight.
This is what makes the Vatican’s eleventh-hour intervention in Baltimore so potentially momentous. It seems to willing wave aside the carefully crafted legal boundaries that the Vatican has energetically used to defend itself from international prosecution.
The failure of the U.S. bishops to challenge the order from the Vatican’s Congregation for Bishops suggests that the bishops are indeed answerable to the Holy See on operational matters dealing with sex abuse policy.
This tacit admission will almost certainly have massive ramifications in future litigation.
Francis Will Regret Removing Bishop Strickland
So far, the Vatican’s legal shield against massive, crippling lawsuits has held.
But Pope Francis’ decision to flout canon law and remove Bishop Joseph Strickland of Tyler, Texas, against his will might smash it. Harnwell opined on Steve Bannon’s War Room:
During the clerical sex abuse crisis in the Catholic Church, the Holy See deftly escaped direct criminal liability in US courts — for potentially hundreds of billions — by arguing, amongst other things, that a pope doesn’t have the power to remove a bishop against his will.
This was necessary to demonstrate that bishops aren’t employees of the Vatican. Many years later and [Francis ] has just done precisely that by sacking the holy Bishop Strickland.
If an international headquarters of your organization can set binding policies, and hire and fire the heads of the “independent” branches that operate in your country, how are they in any sense actually independent? How can Schmizer Global go on dodging liability for the victims whom it harmed?
In part II, I’ll explain why I think this financial catastrophe for Catholics might in fact be God’s own Providence, rescuing His church from corruption, and its ongoing surrender to Caesar, Mammon, and Sodom.
—John Zmirak is a senior editor at The Stream and author or co-author of ten books, including The Politically Incorrect Guide to Immigration and The Politically Incorrect Guide to Catholicism. He is co-author with Jason Jones of God, Guns, & the Government.