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I'm curious as to where you have heard that.

I'm an alumnus (undergrad, 1983, and law, 1987). I actually had Mike Lawler for three theology classes at Creighton. He was an excellent professor, although, I will admit that he was not 100% orthodox in his Catholicism. However, he was not that liberal either. He clearly was not a fan of the papacy and the Magesterium, but he did not exactly trash talk them either. He is a brilliant man and a good teacher. Originally from Ireland, he has been educated abroad and was an interpreter at the Second Vatican Council. When I had him as a professor in the early 80's the essence of what he taught me was orthodox, though not completely so. But I recall that even then he seemed like he was still in the 60's. I was very sad to read how he has apparently continued on a leftward swing. I thought the last twenty plus years would have helped him to see the beauty and wisdom of the gifts of the papacy (through watching the pontificates of John Paul II and now Benedict XVI) and the Magesterium. And, especially the beauty of orthodox Church teachings, including those concerning divorce and marraige. Apparently he's still stuck in the 60's. As far as Creighton University is concerned, my experience was that it was some what liberal (again this is over twenty years ago). The theology professors were not big fans of the papacy and Magesterium, but they were respectful of them. I would describe Creighton as a left-of-center Catholic university. It was not very orthodox, but no where near as liberal and bad as, say, Georgetown has become.
Again, it's been a long time since I've been on campus there and there may be more orthodox professors at Creighton now. I was at a twenty year reunion from undergrad in June of 2003 and I heard that the show Vagina Monologues was not allowed on campus and that a pro-gay/lesbian group was not allowed to hold their meetings on campus. I thought those were two positive signs as to how things are going at Creighton.

Anyhow, I hope Dr. Lawler's personal beliefs about cohabitation, divorce and marriage don't make it into any pastoral letter from the U.S. bishops.