Law and legal issues

WASHINGTON - A bond lawyer group said Wednesday that while issuers technically do not have to file material event notices on rating changes for pre-refunded bonds that have been legally defeased by an escrow of U.S. Treasuries, they can easily file such notices with the Municipal Securities Rulemaking Board's EMMA system.

Harrisburg Mayor Linda Thompson warned that without a fiscal recovery plan in place, Pennsylvania's capital city would be unable to pay its nearly 500 workers in mid-September.

BRADENTON, Fla. - The federal judge presiding over a Securities and Exchange Commission civil suit permanently enjoined former Jefferson County, Ala., commission president Larry Langford from violating securities laws in the future.

DALLAS - A lawsuit filed before the Texas Supreme Court seeks to strike down the state's tax on business, claiming it violates the constitution's prohibition on levying a personal income tax without voter approval.

Three unions that represent employees in the Detroit Public Schools system filed a federal lawsuit over a 10% pay cut and new requirement that employees pay 20% of their health care costs.

SAN FRANCISCO - A federal judge has cleared Vallejo, Calif., to emerge from bankruptcy after three rocky years of Chapter 9 protection.

CHICAGO - Federal authorities announced the filing in court late last week of a $4.7 billion settlement agreement in their lawsuit against the Metropolitan St. Louis Sewer District.

BRADENTON, Fla. - The 11th Circuit Court of Appeals in Atlanta Friday affirmed the conviction of Larry Langford, one-time president of the Jefferson County Commission and former mayor of Birmingham.

BRADENTON, Fla. - Jefferson County, Ala., commissioners last week sent a new settlement offer to creditors holding $3.14 billion of defaulted variable- and auction-rate sewer warrants.

Ron Davis only recently found out about Central Falls' predicament."Somebody sent me an e-mail two days ago," Davis, the mayor of Prichard, Ala., said Thursday in a telephone interview.But his city of 23,000 residents along Alabama's Gulf Coast and the Rhode Island city in bankruptcy court, both with similar population sizes, have experienced major struggles with pension-debt gridlock.

The U.S. Bankruptcy Court for the District of Rhode Island in Providence has designated the Chapter 9 bankruptcy filing by Central Falls as historical, according to a court filing.

CHICAGO - Lawyers for five Wisconsin school districts trying to recoup their ill-fated $200 million investment in collateralized debt obligations to fund their non-pension retiree health liabilities are engaged in formal mediation talks with the financial firms they blame for their losses.

The bankruptcy filing of Central Falls, R.I., created another ripple Thursday, one day after the city's Chapter 9 case opened in downtown Providence.

SAN FRANCISCO - In one of the most complicated bankruptcy cases involving municipal debt, Las Vegas Monorail Co. bondholders are battling on multiple fronts to try and ­recover some of their money.

The troubled city of Vernon has made important reforms but still needs to do more, according to a watchdog report on the city released this week.

BRADENTON, Fla. - Commissioners in Jefferson County, Ala., planned to meet Thursday to continue discussions about settling with creditors who own $3.14 billion of troubled sewer debt, or else file the largest-ever municipal bankruptcy in U.S. history.

While the speculative hysteria about across-the-board municipal debt defaults has calmed, many investors are still wondering what bonds remain at risk and how many municipalities will end up in bankruptcy.

As soon as Central Falls, R.I., filed for Chapter 9 bankruptcy protection, questions emerged.

BRADENTON, Fla. - Attorneys representing Jefferson County and a financial adviser for Alabama told the Securities and Exchange Commission Friday that there is room for improving disclosure practices while striking a balance with the needs of financially struggling issuers.

BRADENTON, Fla. - Jefferson County, Ala., Thursday agreed to take the next week to review a counteroffer submitted by creditors holding $3.14 billion of variable- and auction-rate sewer warrants on which the government has defaulted.