Judge: Detroit Bankruptcy Filing Violates Michigan Constitution

Judge: Detroit Bankruptcy Filing Violates Michigan Constitution

On Friday, a circuit court judge in Ingham County ruled that Detroit’s federal bankruptcy filing violated a part of Michigan’s constitution that protects union pensions. She ordered it withdrawn, a day after Detroit became the largest U.S. city in history to file for chapter nine bankruptcy. 

Judge Rosemary Aquilina also said the filing did not honor President Barack Obama’s work for the city, who she said “took [Detroit’s auto companies] out of bankruptcy.” Aquilina said she would send a copy of her order to Obama. 

According to The Detroit News, Aquilina ruled that the state constitution protects pensions from being diminished and there would be no such protections in a federal bankruptcy proceedings. 

“It’s cheating, sir, and it’s cheating good people who work,” the judge told assistant Attorney General Brian Devlin. “It’s also not honoring the (United States) president, who took (Detroit’s auto companies) out of bankruptcy.”

The Detroit News reported “attorneys representing the pension boards hurried into Aquilina’s court to ask for a restraining order” on July 18, but Michigan Gov. Rick Snyder (R) and Detroit’s emergency manager Kevin Orr “beat them by a few minutes” in filing for bankruptcy. The filing did not deter lawyers for union pension boards, who can use “court maneuvers to slow down federal bankruptcy proceedings.”

Aquilina had harsh words for Snyder, saying she hoped he “reads certain sections of the (Michigan) constitution and reconsiders his actions.”

As the Detroit News notes, “Attorney General Bill Schuette, on behalf of Snyder,” immediately appealed, filing “an application for Appeals Court consideration of the order.” Schuette is planning to “seek emergency consideration to expedite the process.”

Judge Aquilina reportedly predicted Obama may ultimately have to “make sure existing pension commitments are honored.”

“I know he’s watching this,” she said.