DETROIT (Reuters) – Detroit’s relatively fast move through municipal bankruptcy has resulted in costly creditor settlements and too little emphasis on fixing the city’s broken operations, a restructuring expert testified in U.S. Bankruptcy Court on Wednesday.
Still, Martha Kopacz, who was appointed by Judge Steven Rhodes to assess the viability of Detroit’s plan to restructure $18 billion of debt and obligations, concluded the plan is feasible and that its underlying revenue and other assumptions are reasonable.
DETROIT, Oct 21 (Reuters) – The U.S. judge overseeing
Detroit’s historic bankruptcy dropped hints on Tuesday on what
he wants to hear in the city’s closing statements and what he
may be scrutinizing in creditor settlements.
The city’s emergency manager also testified in federal court
on Tuesday that a recent settlement with the last major holdout
creditor was important to keeping elements of Detroit’s debt
adjustment plan together.
DETROIT, Oct 21 (Reuters) – The federal judge overseeing
Detroit’s historic bankruptcy case wants the city to explain its
settlements with creditors and its exit financing in closing
arguments next week, he said on Tuesday.
U.S. Bankruptcy Court Judge Steven Rhodes said it was up to
the city to determine what it will cover in the arguments,
scheduled for Oct. 27, but he specifically wanted to hear about
DETROIT, Oct 20 (Reuters) – A U.S. judge said on Monday he
would rule during the week of Nov. 3 on Detroit’s plan to adjust
its debts and exit the biggest-ever municipal bankruptcy.
Bankruptcy Judge Steven Rhodes said he would issue an oral
ruling in court late that week on whether the plan is fair to
creditors and feasible for the city to carry out. He also set
Oct. 27 for closing arguments in the plan’s confirmation
hearing, which began Sept. 2.
DETROIT (Reuters) – U.S. Bankruptcy Judge Steven Rhodes asked pointed questions on Friday about how Detroit will fare after it exits its historic bankruptcy, expressing concerns about a commission intended to oversee city finances and a settlement with Syncora Guarantee Inc.
Detroit’s state-appointed emergency manager Kevyn Orr, on the witness stand for a third day at the hearing on the city’s bankruptcy plan, told Rhodes the presence of the mayor and city council president on the nine-member financial review commission created under Michigan law should not compromise its mission.
DETROIT, Oct 2 (Reuters) – Without a series of settlements,
Detroit would be facing years of costly litigation from
creditors and others that the city had no guarantee of winning,
Kevyn Orr, Detroit’s emergency manager, said on Thursday.
Orr, on the stand for a second day at a federal court, also
defended Detroit’s 1,111-page bankruptcy plan, saying it was
crafted in good faith and it provides a framework and resources
for the city’s renaissance.
DETROIT, Oct 1 (Reuters) – When Kevyn Orr became Detroit’s
emergency manager 18 months ago, he sparked mistrust among
residents and even created the possibility of civil unrest, he
testified on Monday.
Orr, a corporate bankruptcy attorney tapped by Michigan’s
Republican Governor Rick Snyder in March 2013 to turn around
Detroit’s financial problems, said civil unrest fanned by “some
elements” was a real concern as residents worried he would sell
off city assets and “carry out the ill-will of Governor Snyder.”
DETROIT (Reuters) – Detroit’s controversial sale of $1.4 billion of pension debt, which has become one of the biggest disputes in the city’s historic bankruptcy case, involved risks known to all the parties in the transaction, an attorney for the city said on Wednesday.
Geoffrey Stewart, a Jones Day attorney, said bond insurers and investors were not misled about the legality of the certificates of participation (COPs) Detroit sold in 2005 and 2006 to raise money for its unfunded pension liability.
DETROIT, Oct 1 (Reuters) – Detroit needs to eradicate
blighted properties and keep its art collection in order to
thrive once it exits bankruptcy, a billionaire business leader
told the city’s bankruptcy trial on Wednesday.
“Blight is like a cancer. Blight grows,” Dan Gilbert,
founder of Detroit-based mortgage lender Quicken Loans, said
after taking the stand in the historic bankruptcy case.
DETROIT (Reuters) – With key players in Detroit’s historic bankruptcy case locked in marathon mediation sessions, the pressure is on bond insurer Financial Guaranty Insurance Co., the last major holdout creditor, to settle with the city.
Judicial mediator Gerald Rosen has ordered the city and some of its major creditors including FGIC to keep talking until they come to an agreement. Another deadline looms outside of the court process: Kevyn Orr, the city’s emergency manager, is expected to end his term on Sept. 29.