On Thursday, the city of Detroit filed for chapter 9 municipal bankruptcy. The city’s municipal emergency manger’s filing represents the largest bankruptcy in American history.
“The filing would begin a 30- to 90-day period that will determine whether the city is eligible for Chapter 9 protection and define how many claimants might compete for the limited settlement resources that Detroit has to offer,” the Detroit Free Press reports. “The bankruptcy petition would seek protection from creditors and unions who are renegotiating $18.5 billion in debt and other liabilities.”
“This week, the city’s two pension funds (which have claims to $9.2 billion in unfunded pension and retiree health care liabilities) filed suit in state court to prevent [Detroit emergency manager Kevyn] Orr from slashing retiree benefits as part of a bankruptcy restructuring,” they add.
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