Detroit Deals by Multiple Mediators?

The mediation of the largest municipal bankruptcy in U.S. history utilizes judges as mediators to negotiate the most difficult disputes in trying to resolve billions in Detroit's bond and pension obligations. Proposed restructuring of obligations sparked outrage from city retirees whose pensions and benefits could be cut drastically. Hon. Gerald Rosen, Chief Judge of the U.S. District Court for the Eastern District of Michigan, was charged with overseeing confidential mediation, along with mediators of Judge Rosen's choosing. Judge Rosen appointed other mediators from the judiciary. Bankruptcy judges often utilize mediators as a way to bring together parties in private who might find it difficult to reach a consensus through a more open court process. The city and dozens of creditors launched negotiations this week in hopes of striking deals that could speed the Detroit bankruptcy case. Almost a hundred lawyers representing city pension funds, unions, retirees, the state and bondholders attended the first joint mediation session at federal court in downtown Detroit. Judge Rosen reportedly urged creditors to “Open your minds to areas where we can reach agreements.” Rosen was joined by his colleagues, including several judges from across the country. Negotiations will continue in the weeks ahead before all parties return to Detroit for additional talks next month. Portland based U.S. Bankruptcy Judge Elizabeth Perris will mediate a dispute between the city and bondholders; U.S. District Judge Wiley Daniel of Colorado was assigned to talks involving retirees; U.S. District Judge Victoria Roberts will handle mediation with unions, including the UAW and the American Federation of State, County and Municipal Employees; and Retired U.S. Bankruptcy Judge David Coar of Illinois will mediate disputes involving the Detroit Economic Growth Corp. and Downtown Development Authority. All agreed the future of the region is at stake. See news item here-- http://bit.ly/1aLDPCv

Motor City Mediation?

U.S. Bankruptcy Judge Steven Rhodes, who is overseeing the largest municipal bankruptcy in U.S. history, has proposed appointing a federal district judge as mediator to negotiate the most difficult disputes in trying to resolve some $18 billion in Detroit's bond and pension obligations. Proposed restructuring of obligations sparked outrage from city retirees whose pensions and benefits could be cut drastically. Judge Rhodes tapped Hon. Gerald Rosen, Chief Judge of the U.S. District Court for the Eastern District of Michigan, to oversee any confidential mediation or another mediator of Judge Rosen's choosing. That way, Judge Rosen can mediate disputes or appoint other mediators, with the costs shared by the negotiating parties. Details about the mediation talks would not be disclosed, but any agreements would be made public. Next month, Judge Rhodes will consider deadlines for the city to file its formal plan for repaying its obligations and for rejecting collective bargaining agreements. Bankruptcy judges often utilize mediators as a way to bring together parties in private who might find it difficult to reach a consensus through a more open court process. Judge Rhodes also proposed an order appointing an examiner to review fees to be paid by Detroit. See stories here: http://reut.rs/1aMUiWH and http://usat.ly/15QCKWE