Chrysler filed for relief under chaper 11 of the Bankruptcy Code on Thursday in the Bankruptcy Court of the Southern District of New York. Judge Arthur Gonzales is presiding. The filing became necessary after hedge fund creditors holding approximately 30 percent of Chrysler's total debt refused to sign on to the Treasury Department brokered workout by the April 30 deadline. Look at the the petition or go to the SDNY Bankruptcy Court and review the petition and first day motions. (You'll need a Pacer account for the second link). For readers who speak the language, Bankruptcy Litigation Blog has the word on the legal risks and rewards of a section 363 sale and links to affidavits filed with first day motions by Chrysler insiders and disgruntled creditors' experts.
Yes Alison, Jones Day represents Chrysler. The chapter 11 petition signed by Jones Day NY partner and bankruptcy mega celeb Corinne Ball explains that Chyrsler shut down its manufacturing facilities and will remain idle until the bankruptcy case concludes with a court-approved deal with Fiat and Chrysler creditors as outlined by Treasury. She warned that failure to move quickly through bankruptcy would mean liquidation for Chrysler and “the end of an iconic, 83-year-old American car company,” not to mention the loss of jobs for 38,500 people.
The first hearing in the case was this morning. Reuters reports that the courtroom was packed and very hot. Judge Gonzales halted the proceeding briefly when a Dewey & LeBoeuf associate standing with bankruptcy lawyer Martin Bienenstock (for Chrysler Financial) collapsed. Once the paramedics hauled her out, Judge Gonzales decided six motions in an hour.
3 comments:
Wow! Lots of drama, punctuated by a fainting spell! I hope to watch this case closely as I gear up to join Jones Day in the fall. If I go in up to speed on what's happening, perhaps I can play some lowly bottom-feeder roll :)
Bankruptcy lawyers tend to be a little sensitive to the "bottom feeder" rhetoric.
I think I was referring to my impending status as a first year associate, not to bankruptcy lawyers.
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