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Judge orders mediator to resolve Milwaukee Archdiocese bankruptcy case

MILWAUKEE (WTAQ) - Federal Bankruptcy Judge Susan Kelley has ordered a mediator to try and resolve the three-and-a-half year old bankruptcy case involving the Milwaukee Catholic Archdiocese.

At a hearing Wednesday, Kelley said mediation would be the way to resolve the hard fought case between the church and its creditors -- most of them being 575 people who said they were molested by priests.

This will be the second attempt to have lawyers for the church, the abuse victims, and others mediate a settlement. An initial effort in 2012 failed.

Kelley ordered the mediation before she could consider a request by the creditors to make the church pay over $2 million in legal fees for the victims' attorneys. The church has proposed a financial reorganization plan which the creditors say does not do nearly enough to compensate the sex abuse victims.

The archdiocese has proposed giving 128 victims a total of $4 million from an insurance settlement -- while almost 450 other victims get zero.

Meanwhile, a federal appeals court in Chicago has yet to rule on the victims' claim that it has rights to a $55 million fund for church cemetery maintenance.

The creditors appealed after Judge Rudolph Randa allowed the church to keep the cemetery funds.

(Story courtesy of Wheeler News Service)