Attorney for Parish Plaintiffs1: Ford Elsaesser, Jr., Esq., of counsel, Elsaesser Anderson, Chtd., Priest River, Idaho.
MEMORANDUM DECISION AND ORDER I. INTRODUCTION In March 2023, Plaintiff The Roman Catholic Diocese of Albany, New York (the “Diocese”), filed a petition for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. §§101, et seq. (“Bankruptcy Code”), in the Bankruptcy Court for the Northern District of New York (the “Bankruptcy Case”). See Dkt. No. 4 at 9.2 On October 31, 2023, Plaintiffs initiated an adversary proceeding by filing a complaint against Defendants (the “Adversary Proceeding”). See id. at 10. On November 21, 2023, Defendants Certain Underwriters at Lloyd’s, London (subscribing to policies issued to the Diocese of Albany, New York for periods effective from September 1, 1978 to September 1, 1991), Catalina Worthing Insurance Ltd (CWIL) f/k/a Hartford Financial Products International (as Part VII transferee of Excess Insurance Co. Ltd.), RiverStone Insurance UK Limited (as successor in interest to Terra Nova Insurance Co. Ltd. and Sphere Drake Insurance Co. PLC), and Yasuda Fire & Marine Insurance Co. (UK) Ltd.3 (collectively, “London Market Insurers” or “LMI”) filed their answer to the complaint. See Dkt. No. 1-3 at 103-51. And on January 19, 2024, Defendant Interstate Fire & Casualty Company (“Interstate”), filed its answer to the complaint. See Dkt. No. 4 at 11. Currently pending before the Court are LMI’s and Interstate’s respective motions to withdraw the reference of the Adversary Proceeding to this Court. See Dkt. Nos. 1, 4. For the following reasons, the motions are denied. II. BACKGROUND New York State enacted the Child Victim Act (“CVA”) in February 2019, reviving, for a period of time, previously time-barred actions arising out of certain sexual abuse claims. See N.Y. C.P.L.R. §214-g. Following the enactment of the CVA, individuals filed lawsuits against the Diocese (the “Underlying Actions”). See Dkt. No. 4 at 9. The Diocese proposed a “global settlement and mediation program” to resolve the Underlying Actions; however, an agreement was not reached. In re Roman Catholic Diocese of Albany, No. 23-10244, Dkt. No. 7 at 16. On March 15, 2023, faced with “[i]mpending trial dates,” the Diocese initiated the Bankruptcy Case “to preserve its assets for the benefit of the claims of the CVA claimants and constituencies served by the [Diocese] as well.” Id. The Bankruptcy Court entered an order establishing November 1, 2023 as the deadline to file proofs of claim in the Bankruptcy Case, including proofs of claim related to the Underlying Actions. See In re Roman Catholic Diocese of Albany, No. 23-10244, Dkt. Nos. 445, 447, 481. Neither LMI nor Interstate filed a proof of claim. See Dkt. No. 1 at 17; Dkt. No. 4 at 10. On October 31, 2023, Plaintiffs initiated the Adversary Proceeding against Defendants. See Complaint, Roman Catholic Diocese of Albany v. Certain Underwriters at Lloyd’s, London, (In re Roman Catholic Diocese of Albany), Ch. 11 Case No. 23-10244, Adv. No. 23-90012-1, Dkt. No. 1 (hereinafter referred to as the “Complaint”). In the Complaint, Plaintiffs allege that “[t]he Underlying Actions…are covered by” insurance policies issued by Defendants and that certain Defendants “have failed or otherwise refused to acknowledge their respective obligations…with respect to the Underlying Actions.” Id. at
