The Roman Catholic Church of the Archdiocese of New Orleans

CourtUnited States Bankruptcy Court, E.D. Louisiana
DecidedNovember 13, 2023
Docket23-01018
StatusUnknown

This text of The Roman Catholic Church of the Archdiocese of New Orleans (The Roman Catholic Church of the Archdiocese of New Orleans) is published on Counsel Stack Legal Research, covering United States Bankruptcy Court, E.D. Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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The Roman Catholic Church of the Archdiocese of New Orleans, (La. 2023).

Opinion

UNITED STATES BANKRUPTCY COURT EASTERN DISTRICT OF LOUISIANA

IN RE: § CASE NO. 20-10846 § THE ROMAN CATHOLIC CHURCH OF § CHAPTER 11 THE ARCHDIOCESE OF NEW § ORLEANS, § SECTION A § DEBTOR. § COMPLEX CASE § § RICHARD TRAHANT AND § AMY O. TRAHANT, § § PLAINTIFFS, § ADVERSARY NO. 23-1018 § V. § § MARK A. MINTZ, JONES WALKER LLP, § AND DONLIN RECANO & COMPANY, § INC., § § DEFENDANTS. §

MEMORANDUM OPINION AND ORDER

Before the Court is the Affidavit of Richard Trahant Pursuant to 28 U.S.C. § 144 (the “§ 144 Affidavit”), [ECF Doc. 17], and Plaintiffs’ Motion To Recuse Judge Meredith Grabill (the “Recusal Motion”), [ECF Doc. 36], filed in the above-captioned adversary proceeding (the “Adversary Proceeding”) pursuant to 28 U.S.C. §§ 144 and 455 on behalf of Richard and Amy Trahant (the “Trahants”). Mark Mintz, Jones Walker LLP, and Donlin Recano & Company, Inc., the named Defendants in the Adversary Proceeding, have opposed the § 144 Affidavit and Recusal Motion, [ECF Docs. 22 & 38], and the Trahants have filed a reply brief in support of their pleadings, [ECF Doc. 39]. Having listened to oral argument on October 18, 2023, and having reviewed the pleadings, memoranda, and the relevant law, the Court finds the § 144 Affidavit and the Recusal Motion to be without merit. PROCEDURAL POSTURE On May 1, 2020, The Roman Catholic Church of the Archdiocese of New Orleans (the

“Archdiocese” or, post-petition, the “Debtor”) filed for bankruptcy protection under chapter 11 of the Bankruptcy Code in this Court. [No. 20-10846, ECF Doc. 1]. Prior to filing, the Archdiocese had been defending against at least 34 pending lawsuits filed in Louisiana state court between 2018 and 2020 by individuals alleging claims of sexual abuse by priests or lay persons employed or supervised by the Archdiocese and complicity of the Archdiocese in that abuse (the “Abuse Cases”). Richard Trahant represented plaintiffs in some of the Abuse Cases. Upon filing for bankruptcy relief, all of the Abuse Cases were stayed pursuant to 11 U.S.C. § 362(a), but several of the plaintiffs and their counsel in the Abuse Cases, including Trahant, mobilized quickly and participated from the very start of the Debtor’s bankruptcy case. The Office of the United States Trustee (“UST”) appointed an Official Committee of

Unsecured Creditors (the “Committee”) pursuant to 11 U.S.C. § 1102(a)(1) on May 20, 2020, and reconstituted the membership of the Committee a number of times to deal with the contours of the case. [No. 20-10846, ECF Docs. 94, 151, 478, 1575, 1618 & 2081]. Early in the case, the Court approved the Committee’s retention of the law firms of Locke Lord LLP (“Locke Lord”) and Pachulski Stang Ziehl & Jones LLP (“Pachulski”) as counsel for the Committee. [No. 20- 10846, ECF Docs. 256 & 257]. Individual members of the Committee retained their own counsel to advise them regarding their individual claims against the estate and to assist them in fulfilling their duties as members of the Committee. For two years, Richard Trahant served as counsel to several individual members of the Committee. In late July 2021, the Committee and the Debtor jointly moved this Court for the appointment of Bankruptcy Judge Gregg Zive to mediate the claims filed by over 450 sexual abuse claimants. [No. 20-10846, ECF Doc. 982]. The Court approved that request on September 15, 2021. [No. 20-10846, ECF Doc. 1058]. In January 2022, the Debtor notified the Court of its belief that individual(s) had

breached this Court’s Protective Order governing discovery exchanged between the Debtor and the Committee in the Debtor’s bankruptcy case. The Debtor requested discovery from the Committee and an evidentiary hearing to determine the root of the breach. After months of informal discovery between the parties followed by an official independent investigation by the UST involving numerous depositions and robust discovery, the Court memorialized and detailed its conclusions in a Memorandum Opinion and Order dated June 7, 2022. In that Order, the Court found, among other things, that Trahant had knowingly and willfully violated the Protective Order by disclosing confidential, protected information obtained through discovery in the bankruptcy case to third parties including the media. The Court’s June 7, 2022 Order also instructed the UST to remove the individual Committee members represented by Trahant from

the Committee. A week later, the Court issued a separate Order To Show Cause to determine appropriate sanctions for Trahant’s disclosure of confidential information in violation of the Court’s Protective Order. Months later, the Court held the show-cause hearing. After considering attorney argument and sworn testimony provided by Trahant at that hearing, the Court issued a Memorandum Opinion and Order dated October 11, 2022, detailing the factual and legal bases for imposing sanctions against Trahant in the amount of $400,000 for willfully violating this Court’s Protective Order. That amount represented a fraction of the billable time spent by counsel for the Debtor and the Committee in investigating the source of the leak for months and participating in the formal, independent investigation conducted by the UST. [No. 20-10846, ECF Docs. 1574, 1589 & 1844].1 On June 2, 2023, the Trahants filed a Petition for Damages in Louisiana state court against the Defendants, asserting claims for abuse of process, intentional and negligent infliction

of emotional distress, and loss of consortium, all in connection with the Defendants’ alleged improper service of this Court’s June 7, 2022 Order. [ECF Doc. 7]. The Defendants timely removed the case to the United States District Court for the Eastern District of Louisiana under 28 U.S.C. §§ 1441, 1446, and 1452, and the case was assigned to Judge Ashe. [E.D. La. No. 23- 2053, ECF Doc. 1]. The Trahants moved to remand the case to state court (the “Remand Motion”). [E.D. La. No. 23-2053, ECF Doc. 9]. The Defendants requested Judge Ashe to refer the case to this Court pursuant to the District Court’s local rules and its General Order of Reference, asserting that the Trahants’ lawsuit was not only “related to” the Debtor’s bankruptcy case pursuant to 28 U.S.C. § 1334(b), but that the lawsuit implicates the long-standing Barton doctrine, a common-law principle that bars suits against court-appointed trustees and other

fiduciaries absent court permission. [E.D. La. No. 23-2053, ECF Doc. 11 (citing Barton v. Barbour, 104 U.S. 126, 128 (1881)]. On July 14, 2023, Judge Ashe referred the Trahants’ lawsuit to this Court for all purposes, finding that

1 Trahant and individual former members of the Committee appealed those Orders to the United States District Court for the Eastern District of Louisiana. See In re The Roman Catholic Church of the Archdiocese of New Orleans, No. 22-1738 (E.D. La. Aug. 11, 2022) (ECF Doc. 38 (dismissing former Committee members’ appeal for lack of standing)) & (E.D. La.

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