Court: Judge erred on Milwaukee archdiocese fund

An appeals court has ruled that a $55 million cemetery trust fund is fair game in the Archdiocese of Milwaukee's bankruptcy case.

The 7th U.S. Circuit Court of Appeals in Chicago said Monday that the fund created by New York Cardinal Timothy Dolan when he was archbishop of Milwaukee is not covered by a federal law that protects religious organizations from government interference.

Attorneys for clergy sexual abuse victims say Dolan created the fund to hide money from their clients. The archdiocese filed for bankruptcy in 2011.

Hundreds of victims have since filed claims against the archdiocese.

The appeals court's ruling reverses a judge's decision that had found that the cemetery fund couldn't be touched. The appeals court sent the case back to the lower court for further proceedings.

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