Detroit asks bankruptcy judge to block appeals of eligibility ruling

By Nathan Bomey

Detroit Free Press


(MCT) — The City of Detroit is asking Judge Steven Rhodes to block appeals of his bankruptcy eligibility ruling until the city’s final reorganization plan is approved.

“The City believes Objectors are not entitled to appeal as of right (now) because a ruling of Chapter 9 eligibility is not a ‘final judgment, order or decree,’ “ the city’s lawyers argued today in a court filing.

Last week, Rhodes authorized the city’s bankruptcy filing, ending more than four months of uncertainty over whether the city met the specific legal criteria to receive protection from its creditors.

Emergency manager Kevyn Orr said he would file a “plan of adjustment” with bankruptcy court either late this month or early January. The document would spell out the city’s plan toward moving out of bankruptcy, including what it will offer its creditors.

Several creditors have filed notices of appeal, including the American Federation of State, County and Municipal Employees Council 25, the city’s largest union, as well as the city’s two pension funds and a committee representing Detroit’s retirees.

They also asked Rhodes to allow the case to bypass the U.S. District Court and go straight to the U.S. 6th Circuit Court of Appeals, which would have the option to accept the case or send it back to the District Court.

The city said that if Rhodes opts to allow appeals, it supports the motion to expedite appeals to the 6th Circuit.

Rhodes will consider the issue at a hearing Monday morning.

Even if the appeals proceed, it’s likely the bankruptcy will continue without interruption, unless a higher court places a stay on the case while it reaches a decision.


Posted by Tribune News Services

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