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Dispute stops Gallup Diocese from exiting bankruptcy

GALLUP, N.M. — A new legal dispute has stalled the final resolution of a bankruptcy case prompted by a sexual abuse case involving the Diocese of Gallup, lawyers say.

The dispute involves a new lawsuit filed by attorney Robert E. Pastor against the Sisters of the Blessed Sacrament, a religious order that founded St. Michael Indian School in Arizona.

The suit claims a Navajo woman was sexually abused at the school by a Franciscan friar, The Gallup Independent reported (http://bit.ly/1hoDjlp).

The Gallup Diocese, the Franciscans and St. Michael Mission Church have already reached a settlement agreement with another Navajo woman related to abuse.

That settlement was part of the diocese’s bankruptcy case that was confirmed in June. As a result, the Diocese of Gallup, the Franciscans and St. Michael’s Church are protected parties and not named as defendants in Pastor’s lawsuit.

Sisters of the Blessed Sacrament and St. Michael Indian School did not contribute to the diocese’s settlement, meaning they are not protected parties under the reorganization.

However, Sisters of the Blessed Sacrament has filed a claim against the Diocese of Gallup related to the new lawsuit. The claim has not been settled, keeping the diocese in bankruptcy court.

A phone call by The Associated Press seeking comment from the Sisters of the Blessed Sacrament was not answered.

Attorneys for the diocese say in court documents that they are sympathetic to the plight of the Sisters of the Blessed Sacrament but asked U.S. Bankruptcy Court Judge David T. Thuma to disallow the claim by the religious order.

A hearing on the matter is set for Dec. 12.

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Information from: Gallup Independent, http://www.gallupindependent.com

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