Creditors, who have objected to Detroit's bankruptcy, portrayed Dillon's assessment as evidence that the city rushed into court. If they can prove the city negotiated in bad faith, federal Judge Steven Rhodes could dismiss the city's bankruptcy, forcing Orr back to the bargaining table on debt and long-term obligations that have reached $18 billion. Earlier in the day, General Counsel Michael Nicholson of the United Auto Workers accused the city of refusing to enter proper negotiations, describing meetings with Orr's team as lectures. DAY 4: Mich. gov calls bankruptcy right decision "I have never, ever been involved in any negotiation where one side speaks," said Nicholson, whose union represents fewer than 200 Detroit library employees and fewer than 200 city retirees. Still, Dillon, who was treasurer until last week, insisted that bankruptcy was a last resort, echoing earlier testimony in the trial from Michigan Gov.
For the original version including any supplementary images or video, visit http://www.usatoday.com/story/news/nation/2013/11/05/detroit-bankruptcy-trial/3448717/
UPDATE 1-Ex-Michigan Treasurer skeptical of Detroit pre-bankruptcy deal
"The recovery for the unsecured creditors was so low, I didn't know how anyone could practicably cut a deal and walk out of the settlement room." The former treasurer was called to the witness stand under a subpoena as Detroit retirees, unions and pension funds try to block the city from receiving court protection. He is expected back on the stand when the trial before U.S. Bankruptcy Judge Steven Rhodes continues on Thursday. Dillon played a key role in the lead up to Detroit's July 18 bankruptcy filing by serving on review teams that scrutinized the city's finances. In a July 9 email to Michigan Governor Rick Snyder that was cited in court on Tuesday, Dillon wrote that there were "creative options" for Detroit's public pension shortfall, but he testified on Tuesday that he did not pursue any of those solutions because the pension deficit was "relevant but not a driving factor" behind the city's trip to U.S. Bankruptcy Court. Detroit has $18.5 billion in debt and other obligations, which the city and state say includes a $3.5 billion unfunded pension liability, a figure that is disputed by bankruptcy opponents in the case. The opponents, who include the city's labor unions, retirees and pension funds, are trying to prove that Detroit officials failed to try to negotiate a deal with them and other creditors ahead of the July 18 bankruptcy filing. To be eligible for Chapter 9 municipal bankruptcy, Detroit must prove that it is insolvent, that it negotiated in good faith with its creditors or that there were too many creditors to make negotiations feasible.
For the original version including any supplementary images or video, visit http://www.reuters.com/article/2013/11/05/usa-detroit-bankruptcy-idUSL2N0IQ1W320131105
Bill on Bankruptcy: Listening in the Dark at NCBJ
The company would operate after bankruptcy with the help of $576 million in funding from Barclays Plc and Deutsche Bank AG. The court also approved a rights offering backstopped by Knighthead Capital Management, Patriot said. The offering, announced last month, will raise $250 million in new capital. "Today's actions by the court represent important milestones on Patriot's path to emergence as a strong, well-capitalized competitor in the coal industry," Bennett Hatfield, Patriot's chief executive, said in the statement. Hatfield added that the company is on schedule to emerge from bankruptcy in "mid to late December." Patriot declared bankruptcy in July 2012, saying it needed to cut $150 million a year in employment costs to regain profitability. It received court permission earlier this year to scrap collective bargaining agreements with its union and draw up new, cost-saving contracts. The United Mine Workers of America, which represents some 13,000 Patriot workers, retirees and their families, fought against the move. Patriot's miners will sustain much of the pain of the company's collapse, which has made the case vitriolic.
For the original version including any supplementary images or video, visit http://www.reuters.com/article/2013/11/06/patriotcoal-bankruptcy-idUSL2N0IR26Q20131106?type=companyNews&feedType=RSS
CORRECTED-Creditors to vote on Patriot Coal's bankruptcy exit plan
7 (Bloomberg) -- Bloomberg Law's Lee Pacchia asks Bloomberg News bankruptcy columnist Bill Rochelle how he responded when the lights went out during his luncheon keynote speech at the annual convention of the National Conference of Bankruptcy Judges last week in Atlanta. In the new video, Bill also talks about the two bankruptcy cases coming to the U.S. Supreme Court this term. The video concludes with a proposal for a federal Court of Bankruptcy Appeals to resolve the 10 circuit splits that arose in the last year alone. Having uniformity in bankruptcy law throughout the country would bring an added Bankruptcy Attorney benefit by deterring forum shopping, Bill says.
For the original version including any supplementary images or video, visit http://www.businessweek.com/videos/2013-11-07/bill-on-bankruptcy-listening-in-the-dark-at-ncbj
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