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Bankruptcy Trial for City of Detroit Delayed Until August
The plan created by the city of Detroit to repay its creditors less than the city owes in order to come out of bankruptcy has been delayed for close to one month by a federal judge who is overseeing the case in order to give the parties involved more prep time, according to Bloomberg.
The judge presiding over the case is U.S. Bankruptcy Judge Steven Rhodes. On Monday, Judge Rhodes moved the start date for the trial to August 14 from July 16. Judge Rhodes blamed the delay of the trial on the need to give creditors enough information to prep their cases against the $18 billion debt-adjustment plan created by the city of Detroit.
The creditors asked to have the trial start in the middle of September, but that request was denied by Judge Rhodes. He said that even though the city is responsible for the delay of the trial, one creditor made “unreasonable” demands for documents in the case.
Detroit filed for bankruptcy last year and has negotiated with its unions and retiree groups to limit how much the pensions will be cut. Many bond insurers fight plans that repay bondholders less than what is owed. One such entity is that of National Public Finance Guarantee Corp.Bankruptcy Trial for City of Detroit Delayed Until August by Jim Vassallo