September 26, 2021

Volume XI, Number 269

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September 24, 2021

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September 23, 2021

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Constitutionality of Detroit's Emergency Manager Challenged

Within days of Kevyn Orr’s appointment as Detroit’s Emergency Manager, a group of elected officials, union representatives, civil rights activist and clergy brought a lawsuit against Gov. Rick Snyder and Treasurer Andy Dillon in federal court, challenging the constitutionality of Public Act 436.  As previously posted, under Public Act 436, an emergency manager (an “EM”) has extraordinary powers over the municipality, including the power to break or modify union contracts; however, any plan implemented by an EM may not attempt to modify debt service payments on public debt. 

The Complaint asserts that Public Act 436 is an unconstitutional encroachment in the due process right of an elected, republic form of government.   The plaintiffs also contend that the new law establishes a “new form of government in Michigan” and citizens “will have effectively lost their right to vote”, which is in violation of the 1965 Voting Rights Act because it disenfranchises voters. 

A link to the Complaint may be found here.

©1994-2021 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume III, Number 95
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About this Author

William W. Kannel, Bankruptcy Attorney, Mintz Levin Law Firm, Bankruptcy & Restructuring Insolvency & Creditor Rights Litigation Directors & Officers Litigation Chapter 9 & Municipal Insolvency Litigation
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Bill is a nationally recognized bankruptcy attorney with extensive experience in corporate and municipal reorganizations and debt restructurings both in and out of court. He represents creditors and debtors across a wide range of industries throughout the country in all phases of distressed debt negotiations, bankruptcy litigation, and distressed asset acquisitions. Bill is also recognized as one of the leading attorneys in the nation for his work representing bond trustees and bondholders in Chapter 9 bankruptcies and other governmental and municipal insolvencies.

Bill is the chair...

617-348-1665
Adrienne Walker, Mintz Levin Law Firm, Boston, Finance and Bankruptcy Law Attorney
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Adrienne is a restructuring and commercial finance attorney with significant bankruptcy litigation experience and deep capabilities advancing creditors' rights and representing debt holders in Chapter 11 and Chapter 9 municipal bankruptcies. She skillfully handles bankruptcy matters and workouts in state and federal courts, often representing strategic trade creditors, official and ad-hoc committees, bondholders, debtors, lease parties, and trustees. Her commercial lending work involves advising borrowers on private equity and secured financing transactions. Adrienne...

617-348-1612
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