HUFFINGTON POST: …U.S. District Judge Steven Rhodes ruled Wednesday afternoon that Detroit’s bankruptcy case will go to federal court, overruling challenges to the filing from Michigan’s state court.
Rhodes decision halts a Friday ruling from Ingham Circuit Court Judge Rosemary Aquilina that declared the bankruptcy filing unconstitutional.
Detroit filed for bankruptcy last Thursday afternoon, just five minutes before Aquilina was set to rule on three lawsuits filed by pensioners and retirees in an emergency hearing. Typically, a bankruptcy filing creates an immediate stay on all lawsuits filed against a city in other courts.
But lawyers representing Detroit’s two pension funds and several unions argued today that the bankruptcy filing was not legal, since public pensions are protected under Michigan’s constitution. Detroit’s pension pays out to 21,000 retirees and about 9,500 city employees… (more)
