DETROIT -- A federal judge has put a stop to lawsuits threatening Detroit’s bankruptcy and declared that he will handle any challenges.
The decision Wednesday after two hours of arguments is a victory for Detroit. A county judge last week said Gov. Rick Snyder ignored the Michigan Constitution and acted illegally in approving the Chapter 9 filing, the largest ever U.S. municipal bankruptcy.
Retirees sued, claiming their pensions are protected by the constitution and are at risk in a bankruptcy.
U.S. Bankruptcy Judge Steven Rhodes suspended any pending lawsuits and barred new ones. He says his court will be the exclusive venue for any legal action regarding the bankruptcy.