Lawyers Trying To Stop Detroit Bankruptcy Claim Governor Tricked Them

You didn't think the bankruptcy of a major American city would go ahead without drama, did you? According to reports, opponents of Detroit's bankruptcy attempted to halt it from proceeding, but they claim they were hoodwinked by the governor and beaten to the courthouse by mere minutes.

A little backstory: on Wednesday, two pension funds — the Detroit General Retirement System and the Detroit Police and Fire Retirement System — filed a lawsuit against Michigan Gov. Rick Snyder and Detroit Emergency Manager Kevyn Orr. Their suit seeks to block Orr's debt restructuring plan from slashing pension benefits for thousands of active and retired employees.

Their suit claimed a bankruptcy filing would conflict with the state’s constitutional protection of public retirees’ rights, according to Bloomberg.

Today, an emergency hearing was to be held where Ingham County Circuit Court Judge Rosemarie Aquilina would have ruled on a request for a temporary restraining order blocking Snyder from authorizing a bankruptcy filing, The Detroit News reports.

But at the request of attorneys for the governor, that hearing was delayed five minutes, according to the Detroit Free Press.

And in that five minutes, attorneys for the governor filed their motion in federal court to seek Chapter 9 bankruptcy. BOOM.

To make matters worse, the circuit court judge, Aquilina, said she would have issued a restraining order to block a bankruptcy.

Needless to say, bankruptcy opponents now say they feel hoodwinked by the governor's office. From the Freep:

A furious attorney Ronald King, representing Detroit’s General Retirement System and the Detroit Police and Fire Retirement System, said he agreed to a five-minute delay which he believes was not offered in good faith.

“There’s no denying this was a race to the courthouse this afternoon and yet another example of usurping the will of the people,” King said.

Emphasis mine. This effort to rush the bankruptcy through may explain why the date on the filing was changed by hand from Friday to today.

We'll see what happens from here, but legal action could tie things up even further.

Photo credit Wikimedia Commons