Archdiocese in Oregon loses court bid to protect Catholic church assets
12-31-2005
SAN FRANCISCO (AFP)

A US federal bankruptcy court judge dealt a blow to Roman Catholic Church leaders trying to protect parish property from lawsuits by victims of sexual abuse by priests.

US Judge Elizabeth Perris rejected the contention that church assets in the northwestern state of Oregon were being held in trust by the Archdiocese of Portland and therefore could not be used to settle lawsuit debts.

Perris also ruled that the court had proper jurisdiction over the bankruptcy proceedings despite religious freedom protections crafted into the US Constitution. Story

And here:
Archdiocese to pay in lawsuits
December 31, 2005

PORTLAND, Ore. (AP) -- A bankruptcy judge ruled yesterday that the Archdiocese of Portland, not its parishes, owns church assets, dealing a major blow to its efforts to protect church property from lawsuits filed by purported victims of priest sex abuse.
U.S. Bankruptcy Judge Elizabeth Perris, in a pair of opinions, ruled that church property and real estate is under the control of the archdiocese, not its individual parishes, as attorneys for the archdiocese had argued.
She rejected the archdiocese's claim that applying federal law instead of church law could violate its First Amendment right to religious freedom by disrupting the internal governance of the church. The rest