Law and legal issues

The board of New Jersey's biggest pension fund voted Wednesday to sue New Jersey Gov. Chris Christie over reduced contributions to the state's pensions.

Michigan Gov. Rick Snyder knew a $195 million contribution to Detroit's bankruptcy could concern analysts, but believes it is important, a spokesperson said after Standard & Poor's revised its outlook.

Paying the moral obligation debt the state guaranteed for the failed 38 Studios will strengthen Rhode Island's image in the capital markets, Gov. Lincoln Chafee said in an interview.

The Puerto Rico Superior Court refused to hear a suit by Doral Financial against the Puerto Rico Treasury, but the firm said it has another venue to fight its $229 million dispute with the commonwealth's treasury.

S&P revises Michigan's outlook down to stable from positive, citing soft revenues as well as its recent contribution to Detroit's bankruptcy.

Structural protections and a yield-hungry market are apt to boost interest in bonds for the Detroit Public Lighting Authority, despite the city's ongoing Chapter 9 bankruptcy.

Fitch Ratings said Monday it has withdrawn its D ratings on most of Detroit's debt, saying there's no reason to maintain a rating on defaulted bonds.

Moody's Investors Service deemed a California Superior Court judge's ruling that existing teacher tenure and seniority laws are unconstitutional a credit positive.

Two bond insurers that wrap Detroit water and sewer bonds have told bondholders to reject Detroit's bankruptcy plan of confirmation, even as the insurers fight for the exclusive right to vote on the plan.

In a major development, Detroit bankruptcy mediators announced a settlement on the treatment of the city's limited tax general obligation bonds. Terms were not immediately disclosed.

Covington, Ky.'s former finance director was sentenced to 10 years in prison for embezzling more than $793,000 in city funds, a judge decided June 6.

The Michigan Legislature adjourned for the summer on June 12 after failing to reach an agreement on new transportation funding despite weeks of intensive effort and support from business and labor groups and Gov. Rick Snyder.

Bleary-eyed Rhode Island House members shortly after midnight approved a revised $8.7 billion budget bill that included a $12.5 million payment toward 38 Studios moral obligation debt.

The pressure of meeting retirement obligations is likely to remain a major policy problem for many California cities, highlighted by the Stockton and San Bernardino Chapter 9 bankruptcies.

California's plan to build a $68 billion high speed rail system in the state is being challenged by two counties and a city, which say the plan violates the state's environmental laws.

Two more foundations have pledged $13 million to Detroit's pensions via the Detroit Institute of Arts in a bid to protect the museum's prized art collection as part of a grand bargain worked out by federal court mediators.

A court ruling that California teacher tenure laws in California are unconstitutional could have positive credit implications for school districts, according to Standard & Poor's.

The Orlando-Orange County Expressway Authority board approved a $230 million interchange project in what was likely its final act before the agency is transferred to a new organization.

Bond insurer Syncora Guarantee said in a court filing that Detroit, as well as federal court mediators and even the bankruptcy judge himself have unfairly singled out the insurer as part of an anti-Wall Street public relations campaign.

Debate over the 38 Studios bond fiasco reheated late into the night as a Rhode Island lawmaker offered a bill to ban a $12.5 payment on moral obligation debt a state agency issued on behalf of the failed video game maker.