Thursday, August 7, 2014

Looking back a few weeks, Snyder subpoenaed in Detroit bankruptcy case


from June 20, 2014

Jonathan Oosting | joosting@mlive.com By Jonathan Oosting | joosting@mlive.com






LANSING, MI -- A bond insurer fighting Detroit's bankruptcy debt adjustment plan has subpoenaed Michigan Gov. Rick Snyder, seeking sworn testimony and documentation regarding the state's role in the historic case.
It's not immediately clear if Snyder, who testified under oath in October as part of a bankruptcy eligibility trial, will agree to a second deposition following subpoena from the Financial Guaranty Insurance Company.
The governor and administration "have worked tirelessly to ensure the utmost transparency throughout the entire process," spokesperson Sara Wurfel said in an email.
"If you recall, he has already provided a deposition and testified in open court. We will be working with our and opposing counsel to determine next steps and find a resolution."
FGIC filed the subpoena on Friday, the same day that Snyder signed and celebrated legislation authorizing $194.8 million in state aid for Detroit pensions as part of a "grand bargain" bankruptcy deal that would minimize cuts for retirees.
The settlement includes more than $800 million in outside money, much of it from philanthropic foundations seeking to protect prized works at the Detroit Institute of Arts from a potential fire sale to pay off creditors.
Retirees have until early July to vote on the city's plan of adjustment, which anticipated the grand bargain but is separate from it. The plan must also be approved by federal bankruptcy Judge Steven Rhodes over expected objections.
FGIC is among a group of creditors that wants the city to sell DIA assets in order to settle debts and is expected to fight the plan at a trial, which is likely to stretch from mid-August to late September.
The bond insurer also subpoenaed videotaped depositions from Snyder chief of staff Dennis Muchmore and former Detroit chief financial officer Sean Werdlow.
In a separate filing, FGIC also said it "reserves the right" to call them as witnesses during trial to discuss the "plan feasibility, the availability and amounts of State funding, and the ongoing role of the State" in the bankruptcy process.
Snyder answered questions about Detroit under oath in an October deposition. At the time, he was believed to be Michigan's first sitting governor to participate in such a deposition. He could also be the second, if he chooses to cooperate.
Another Detroit bond insurer, Syncora, subpoenaed Michigan Attorney General Bill Schuette, seeking testimony about why he authored a written opinion that the DIA collection could not be sold in bankruptcy. Schuette is fighting the subpoena.
FGIC said other potential witnesses at trial include DIA CEO Graham Beal, Kresge Foundation CEO Rip Rapson, various financial experts and parties who expressed an interest in the DIA collection.
Earlier this week, FGIC and Syncora filed a motion requesting that Rhodes unseal a secret order related to the mediation process that produced the "grand bargain" and other settlements.
Jonathan Oosting is a Capitol reporter for MLive Media Group. Email him, find him on Facebook or follow him on Twitter

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Detroit Bankruptcy


 Hey, Snyder you broke it in bankruptcy; you own it.
What's taking Snyder so long to declare state of emergency? Freeways still closed?
He did a fly over! What's he waiting on?
He won't ask POTUS for help for us!!! Come on Snyder!!



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