CHICAGO — The federal judge in charge of mediation in the Detroit bankruptcy case has ordered the city back into confidential talks with holders and insurers of $1.4 billion of pension certificates of participation.
The COPs holders, along with a few bond insurers and water and sewer bondholders, have not yet reached settlements with the city. Mediation has led to settlements with the city's general obligation bondholders — though terms of the limited-tax GO deal remain secret — as well as most of its labor creditors.
U.S. District Chief Judge Gerald Rosen filed a court brief June 26 ordering the parties back into mediation on Monday, June 30.
Along with the city, the following creditors are ordered into talks on Monday: Syncora Guarantee, Inc., Berkshire Hathawy Reinsurance Group, Wilmington Trust Company, NA, EEPK Bank and its affiliates, the Ad Hoc COPs Holders, which includes Dexia Credit Local, Norddeutsche Landesbank Covered Finance Bank, SA, and Financial Guaranty Insurance Co.
Detroit has sued to invalidate the pension certificates, saying it believes they were illegally issued in the original 2005 transaction and therefore do not need to be repaid.
