Federal Bankruptcy Judge Thomas Bennett Friday entered several major orders that chisel away portions of the $1.63 billion class-action suit filed in Jefferson County, Ala.'s Chapter 9 bankruptcy case.
The suit, citing a theory of corruption underpinning the county's sewer deals as way to invalidate a portion of the debt, was filed by a group of elected officials and residents in Birmingham as a class action on behalf of all sewer system customers.
Bennett agreed with a motion filed by Jefferson County and ruled against certifying a class action. That would allow the complaint to proceed as an individual action by the plaintiffs named in the suit.
The judge also agreed with a motion filed by Jefferson County seeking a more definitive statement with regard to the claims, and he ordered the plaintiffs to file a new complaint by April 4. It is the second time that Bennett has ordered the group to file another complaint clearly specifying their claims.
Bank of America NA was also dismissed from the case last week because it had transferred all interest it held in the county's sewer warrants to a third party.
In December, Bennett dismissed five of the nine counts cited in the suit, including one against Haskell Slaughter Young & Rediker LLC, bond counsel for the sewer warrant bond sales.
The suit was filed on behalf of the claimants by attorney Calvin Grigsby, who is president of broker-dealer firm Grigsby & Associates Inc.
