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Attorney Takes on Objections to Detroit Bankruptcy Plan

Detroit's plan to adjust its debt is feasible and fair to creditors, while trying to fix city finances outside of U.S. Bankruptcy Court would lead to a blizzard of litigation, an attorney for the city said Wednesday as he completed an opening argument in the landmark bankruptcy case. Bruce Bennett, a Jones Day attorney representing Detroit, wrapped up his three-hour opening statement by disputing arguments from creditors who claim the city's plan to adjust its $18 billion in debt is inadequate and should be scrapped. "We think this is the city's last best chance and we think it will work," Bennett told Judge Steven Rhodes, who on Tuesday began a confirmation hearing on the Detroit plan that is expected to last for weeks. Detroit has reached settlements with most of its major creditors, including the city's retired workers. Objectors to the plan are the insurance companies Syncora Guarantee Inc and Financial Guaranty Insurance Co. Both guaranteed payments on $1.4 billion of pension debt the city is seeking to void, and both are facing recoveries of just pennies on the dollar.

Detroit Shuts Off Water to Thousands of Residents 2:29

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--- Reuters