Judge Rules Detroit's Bankruptcy Claim Violates Constitution

Judge Rules Detroit's Bankruptcy Claim Violates Constitution

Detroit really can't catch a break. As if being the largest city in U.S. history to file for bankruptcy wasn't crushing enough, a judge ruled that the filing was unconstitutional this afternoon and, therefore, must be withdrawn. According to Ingham County Circuit Judge Rosemarie Aquilina, the Chapter 9 claim is a violation of the Michigan Constitution, which prohibits any moves that jeopardize public employees' pension benefits. 

CNN Money cited attorneys for Detroit's pension funds who claimed retirees won a last-minute hearing yesterday to prevent the filing. Even though Detroit Emergency Manager Kevin Orr filed the paperwork 5 minutes before this hearing was slated to begin, Judge Aquilina informed those lawyer's of her plants to approve their injuction. 

Michigan Attorney General Bill Schuette said the state will appeal the decision. Aquilina requested that her order be forwarded to the White House, asserting that President Obama might want to reconsider what he had done"bailed out Detroit." While Obama says he will keep a close eye on this mess, he insisted that the final decision rests with municipal and state leaders.

Can it possibly get worse for Detroit right now? Is there a silver lining to this cloud?

[via The Huffington Post and CNN Money]

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