Catherwood LibraryILR School

On Tuesday, when the federal judge cleared the city of Detroit to proceed with Chapter 9 bankruptcy, he made it abundantly clear that while pensions are important, they are far from untouchable. The judge reasoned that since the state?s constitution did not classify pensions differently than other contractual obligations, then they were similar to the rest of the city?s voidable debt, which means that the pensions will be restructured during the city's bankruptcy. The judge also found that Detroit did not bargain in ?good faith? by not allotting appropriate time to negotiate with the city?s 48 unions. Although, the judge agreed with the city?s emergency manager?s argument that it would have been impossible to negotiate with all 100,000 creditors as well as the unions. The unions involved are already planning to appeal the decision to the Sixth Circuit Court and are so committed that they will appeal to the U.S. Supreme Court if necessary.