Detroit Bankruptcy Decision To Wait A Week

Jul 22, 2013

The first Detroit federal bankruptcy hearing takes place Wednesday.

Pension fund attorney Ronald King following a hearing on whether Detroit’s bankruptcy filing violates the Michigan Constitution. Ingham County Circuit Judge Rosemarie Aquilina says she will make a ruling in the case next week.

As we hear from The Michigan Public Radio Network’s Rick Pluta, one of the issues might be how to deal with the different legal challenges to the bankruptcy filing.

One of the questions that could be settled by U.S. Bankruptcy Judge Steven Rhodes is whether a challenge in a Lansing court to the filing will be re-assigned to a federal court.

Ronald King is an attorney for Detroit’s pension funds. He says the Michigan Constitution has specific protections for public pensions that are now threatened by bankruptcy.

“It’s very narrow, very straightforward, and it’s simply an issue of upholding the constitutional protections that are in place,” he says.  “This is what the people of the state of Michigan decided was important.”

King wants the question to remain in the state court system.

Taking pension funds off the table would complicate a bankruptcy. Pension funds are among Detroit’s biggest creditors.