Sacramento, CA asked in Bankruptcy and Civil Litigation for California

Q: What are the notification requirements for creditors in a Chapter 11 case involving sexual abuse claims from the 70s?

I am a creditor who was not notified about an ongoing Chapter 11 bankruptcy case in California concerning the San Francisco Archbishop, related to a sexual abuse claim from my childhood. I discovered I'm not listed as a creditor in the bankruptcy schedules and filed a motion for a late claim, but the debtor's counsel is opposing it. I have documentation from my original attorney confirming that I was informed about the case and the past bar date. I have school records from San Jose in the 1970s linking me to the school where the abuse occurred. I'm working with my attorney regarding the debtor's counsel's objection. What are the requirements the debtor's counsel must follow to notify students from the 70s like me? The school confirms they have my records, and I am easily found through a Google search.

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1 Lawyer Answer
James L. Arrasmith
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A: In bankruptcy cases, debtors must provide adequate notice to all "known creditors," which typically requires direct mail notification to those whose identity and address are reasonably ascertainable. For the San Francisco Archbishop's bankruptcy proceeding, if the school maintained records identifying you as a student during the relevant period, and those records were accessible to the debtor, you may qualify as a "known creditor" entitled to direct notice. The Supreme Court established in Mullane v. Central Hanover Bank & Trust Co. that notice must be "reasonably calculated, under all circumstances, to apprise interested parties of the pendency of the action."

For cases involving historical sexual abuse claims, bankruptcy courts have developed specialized protocols recognizing the unique challenges in identifying potential claimants. Debtors handling institutional abuse cases often must implement supplemental notification procedures beyond standard mailings, including media advertisements, outreach to alumni networks, and notices in publications likely to reach former students. Your situation—having documentation connecting you to the school during the relevant period and being discoverable through a simple internet search—suggests the debtor may have failed to meet the "reasonably diligent search" standard courts typically require.

The fact that your school confirms possession of your records could significantly strengthen your motion for a late claim. Courts evaluating such motions consider factors including the reason for the delay, potential prejudice to the debtor, and whether the creditor acted in good faith. Given the sensitive nature of sexual abuse claims and the documented institutional connection, bankruptcy judges often apply a more flexible standard when evaluating notification adequacy in these cases. Your attorney should emphasize these factors when addressing the debtor's objection, potentially citing similar cases such as the Catholic Diocese bankruptcies where courts permitted late claims from abuse survivors who were not properly notified despite available institutional records.

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