Spokane, Wash., diocese and law firm set for February malpractice trial

NCR's must-read Morning Briefing from Thursday includes the story out of Spokane, Wash., diocese about a federal judge's decision to allow the diocese to take its legal malpractice claim to trial against Spokane-based Paine Hamblen, the law firm that handled the diocese's 2007 bankruptcy.

Blase Cupich, who was bishop of Spokane until he was installed as archbishop of Chicago in November, testified earlier this week that he was alerted by a different federal judge and the mediator of a massive post-bankruptcy settlement, Michael Hogan, that Paine Hamblen bungled the diocese's bankruptcy by in part not anticipating the huge turn-up of new sex abuse cases.

The Spokesman-Review reported Thursday that the trial will begin in February 2015. At stake is the diocese's request to have the $3.6 million in already-paid legal fees to Paine Hamblen returned to the diocese. Paine Hamblen asked the court to dismiss the case, but the judge correctly ruled to let the case go to trial and allow the diocese to have its day in court.

In an Oct. 13, 2012, letter to parishioners, Cupich addressed the diocese's and his own responsibility to the parishioners:

"My preference has always been to resolve these issues quietly and through mediation, so as to avoid further unnecessary publicity for the Church. Yet, when faced with the rejection of our offer to enter into mediation to resolve these serious issues, I could not ignore an important and compelling point impressed upon me by my advisors, namely that I have a fiduciary responsibility to you, the people of the diocese, for the sacrifices and support you have been called on to make over these past few years."

Often in these kinds of litigation cases, the parties are better served to agree to pre-trial mediation. The law firm's malpractice insurance company is likely to want to resolve this matter in mediation rather than in a courtroom. Mediation certainly makes sense in this case. Time will tell.