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Monday, August 5, 2013

History was made when Detroit filed Chapter 9 on Thursday, July 18, 2013.  Detroit is the largest government entity to ever file for bankruptcy in America.   The case has been a long time coming, forty plus years, and it would seem easy to blame this group or that one.  Nothing is that simple, so you will not get any blame labeling from this site.  Just the plain interpretation.

Chapter 9, is very closely related to chapter 11, and chapter 9 refers to numerous chapter 11 code sections.

Chapter 9 has 20 sections in three subchapters as follows, subchapter 1, general provisions, subchapter 2, administration and subchapter 3 the plan.  Chapter 11 has 31 sections covering three subchapters with a fourth subchapter covering railroads.  Subchapter 1, officers and administration, subchapter 2, the plan and subchapter 3, post-confirmation matters.     Chapter 1, 3 and 5 also apply to chapter 9.  Chapters 1, 3 and 5 apply to all other subchapters such as chapter 7, 11, 12 and 13.

Chapters 1, 3 and 5 deal with many common things, such as administration, powers, creditors, debtors and the estate and property.  It explains roles, and duties, and what may be or must be done.

Judge Rhodes has established a timeline for the case.  As an experienced attorney that has practiced in the Eastern District of Michigan I can tell you that the time frames established are quite fast, but not beyond what is normal. Judge Rhodes is known for his expedient courtroom style, and is the best suited Judge to handle a case of this magnitude.


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