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Scores of retirees and creditors, including the American Federation of State, County and Municipal Employees, have challenged Detroit's historic Chapter 9 bankruptcy filing, arguing that it is unconstitutional because it could be used to slash retiree pensions and that Emergency Manager Kevyn Orr didn't negotiate in good faith with creditors before filing for bankruptcy in July. "The City, led by its unelected, politically appointed Emergency Manager, Kevyn D. Orr, hastily commenced this unconstitutional, unlawfully authorized chapter 9 proceeding seeking the haven of bankruptcy to illegally attempt to slash pension and other post-employment benefit obligations and cram such reductions down the throats of current and former City employees," Sharon Levine, an attorney for the AFSCME, the city's largest union, wrote in a court filing." Chief U.S. District Court Judge Gerald Rosen, the head mediator in Detroit's bankruptcy, has assigned Portland, Oregon-based U.S. Bankruptcy Judge Elizabeth Perris to mediate the dispute between the city and its creditors. A former bankruptcy appeals judge, Perris has evidently been instrumental in mediating the municipal bankruptcy in Stockton, California. "She has been invaluable in the [Stockton] case and we have reached some agreements with her help," said Marc Levinson, an attorney for the city. "I'm a huge believer in mediation generally and Judge Perris in particular." (DETROIT NEWS, STATE NET)
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