Bankruptcy Law
GM Files for Bankruptcy; Judge Approves Chrysler Sale
Posted Jun 1, 2009 6:37 AM CST
By Debra Cassens Weiss
General Motors filed for bankruptcy this morning under a restructuring plan that calls for the United States to own 60 percent of GM stock.
The filing says GM has $82.3 billion in assets and $172.8 billion in debts, the New York Times reports. In a briefing Sunday night, administration officials said the government will invest another $30 billion in the automaker, in addition to $20 billion already spent.
Overseeing the case is U.S. Bankruptcy Judge Robert Gerber of Manhattan. At the time of his appointment in 2000, he was a partner in Fried, Frank, Harris, Shriver & Jacobson in New York, according to an online profile.
Weil, Gotshal & Manges will represent GM, Times Online reports.
A key legal issue, according to the Washington Post, is whether bondholders could get more for their debt in a liquidation rather than a reorganization.
The filing comes one day after a bankruptcy judge approved the sale of Chrysler to a new company owned by Fiat, the Washington Post reports in a separate story.
Prior coverage:
ABAJournal.com: "Lawyers Joke that GM Bankruptcy Will Deplete Experienced Bar"
Additional coverage:
Crain's Detroit Business: "Local Attorneys: General Motors’ Bankruptcy Messier than Chrysler’s"
Newsweek: "The Bankruptcy Parasites"
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Comments
Joe
Jun 1, 2009 6:54 AM CST
Do you think Government Motor’s stock will be worth buying once it comes out of bankrutpcy?
It will be interesting to see how the unions bargain now that they are 20% stakeholders in Government Motors? Will they do what is best for the company or their members? I can see some union lawsuits coming fairly quickly after their first collective barganing agreement once Obama says it is ok for them to come out of bankruptcy.
Wonder if Obama will pull the East Germany files on how to run a car company.
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Obama is a dictator
Jun 1, 2009 8:30 AM CST
Saw this in the paper this morning. It looks like Obama is now in charge of the courts. Obama is now officially our first American dictator.
The bankruptcy judge hearing the Chrysler case said Friday he wasn’t going to rule on the asset sale until today or Tuesday, but a call from the White House must have prompted him to move faster because he ruled in the wee hours of this morning.
See, the administration wanted to hold up Chrysler as an example of a “quick and speedy” bankruptcy, but Judge Arthur Gonzalez - deciding he needed more time to rule - put a crimp in those plans and left the White House looking at a GM filing today and Chrysler still in. Oops.
Remarkably, Gonzalez got all his work done just in time and filed his opinion after midnight to save the show.
I’m sure we’ll hear today when questioned that the White House had nothing to do with that timing, just as we’ve heard that it is not making management decisions at GM or Chrysler.
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Tim
Jun 1, 2009 10:59 AM CST
Another great article.
So, should it be any surprise to discover that the Democratically controlled Congress of America is working on passing a new regulation that would give the American Treasury department the power to set “fair” maximum salaries, evaluate performance and control how private companies give out pay raises and bonuses? Senator Barney Franks, a social pervert basking in his homosexuality (of course, amongst the modern, enlightened American societal norm, as well as that of the general West, homosexuality is not only not a looked down upon life choice, but is often praised as a virtue) and his Marxist enlightenment, has led this effort. He stresses that this only affects companies that receive government monies, but it is retroactive and taken to a logical extreme, this would include any company or industry that has ever received a tax break or incentive.
http://english.pravda.ru/opinion/columnists/107459-0/
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