Bankruptcy Judge Urges Detroit & Creditors to Negotiate

The Detroit skyline rises behind the Monument to Joe Louis, also known as "The Fist," Thursday, July 18, 2013. State-appointed emergency manager Kevyn Orr asked a federal judge permission to place Detroit into Chapter 9 bankruptcy protection. (AP Photo/Paul Sancya)
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The judge who found Detroit is eligible for bankruptcy court is urging the city and its creditors to keep negotiating.
Judge Steven Rhodes released a 150-page written opinion Thursday that largely mimics his 90-minute remarks from the bench earlier in the week. But a written opinion was necessary, especially for unions and pension funds that are pursuing appeals.
Rhodes said Detroit is eligible for Chapter 9 protection because the city is broke and any negotiations with thousands of creditors before the July filing would have been impossible. As part of his ruling, he found pensions are like any other contract and can be broken in bankruptcy, despite protections in the Michigan Constitution.
The judge hasn't responded to requests that the 6th U.S. Circuit Court of Appeals immediately take the case.

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