Century Indemnity Company v. The Roman Catholic Archbishop of San Francisco

Background

The Roman Catholic Archbishop of San Francisco (RCASF) faced approximately 537 state-court lawsuits concerning alleged sexual abuse by clergy or others associated with RCASF. Those cases were consolidated in 2023. RCASF then filed for Chapter 11 bankruptcy in the Northern District of California, which automatically stayed lawsuits against it under 11 U.S.C. § 362. The bankruptcy court referred the case to mediation.

RCASF later sought an injunction involving state-court actions against RCASF and its non-debtor affiliates. RCASF and the Official Committee of Unsecured Creditors submitted a stipulation asking the bankruptcy court to release five cases from the automatic stay for trial and judgment, allow successful judgment creditors to seek recovery from RCASF’s insurers, and allow all 541 claimants to send policy-limits demand letters to RCASF and non-debtor defendants for forwarding to insurers.

The insurers opposed the stipulation. They argued that RCASF had not shown cause to lift the automatic stay, had not provided enough information about the five proposed cases, and had not supported the requested relief with sufficient evidence. They also argued that factors identified in In re Curtis supported keeping the stay in place.

On September 2, 2025, the bankruptcy court granted the stipulation by text order and waived the 14-day stay. It later entered a written order. The insurers appealed and asked the bankruptcy court for a stay pending appeal. The bankruptcy court denied that request on October 9, 2025. The insurers then asked this district court for a stay pending appeal and an emergency interim stay. Judge Orrick denied the emergency request on October 22, 2025, and later ruled on the full stay motion.

Legal standard

A stay pending appeal is discretionary, not automatic. The court considered four factors: whether the insurers showed a strong likelihood of success on the merits, whether they would suffer irreparable harm without a stay, whether a stay would substantially injure other interested parties, and where the public interest lies. The Ninth Circuit uses a flexible “sliding scale” approach, under which a stronger showing on one factor may offset a weaker showing on another. Because the insurers’ showing of irreparable harm was weak, they needed a particularly strong showing that they were likely to succeed on the appeal.

Analysis

Irreparable harm. The insurers argued that they could receive more than 500 demand letters requiring them to review claims, evaluate potential liability and damages, obtain additional information, and respond without the discovery available in the bankruptcy proceeding. They also asserted that refusing demands could create a risk of substantial future liability.

Judge Orrick concluded that these concerns did not establish concrete, irreparable harm. He found the insurers’ predictions partly speculative and determined that administrative burdens, costs, and risks of the type described did not justify the extraordinary relief requested. He also noted that the insurers had received extensive claim-related materials, that claimants had previously filed state-court complaints, and that the demand letters would include proofs of claim. The court concluded that the insurers could evaluate each claim and identify incomplete information, and that concerns about future liability were too speculative to support a stay.

Likelihood of success. The insurers argued that the bankruptcy court had relied on too little evidence and that Ninth Circuit law required a ruling in their favor. Judge Orrick concluded that the insurers had not made the strong merits showing required under the sliding-scale approach.

The court determined that the bankruptcy court likely did not abuse its discretion by considering a declaration from Fr. Patrick Summerhays along with the parties’ briefing and other information in the record. The court also concluded that the bankruptcy court likely did not abuse its discretion by failing to provide a detailed analysis of the Curtis factors in the orders approving the stipulation. The court noted that Curtis provides a nonexclusive list of factors and that failing to discuss those factors in depth did not itself demonstrate error. Judge Orrick stated that further briefing at the merits stage might provide more information.

Harm to other parties. The insurers argued that a stay would merely restore the prior status quo and preserve the mediation process. Judge Orrick disagreed. He concluded that survivors would likely be significantly harmed by continued delay because many had waited decades for compensation, and delay could weaken their ability to prove their claims. He also concluded that RCASF would be harmed because a stay could interfere with mediation and prevent a speedy, efficient, and economical resolution of the bankruptcy case.

Public interest. The court concluded that the public interest favored denying the stay. It identified public interests in allowing hundreds of survivors of child sexual abuse to seek redress, helping RCASF reach an efficient bankruptcy resolution, and securing a just, speedy, and inexpensive determination of the bankruptcy proceeding. Those interests outweighed the public interest in reducing the insurers’ burden of reviewing and responding to individual demand letters.

Disposition

Judge William H. Orrick denied the insurers’ motion to stay. The court did not decide the underlying merits of the insurers’ appeal in this order and stated that it would consider those issues in more detail after the parties submitted their briefing.