Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
San Bernardino Commits to Mediation 'Outline'
Author: Joel R. Glucksman
Date: September 17, 2013
Key Contacts
Back
One week after a U.S. Bankruptcy Judge ruled that the city of San Bernardino is eligible to seek protection under the provisions of Chapter 9 municipal bankruptcy, city officials committed to preparing an “outline” by October 15 when they enter into discussions with creditors and a mediator.
The city will be required to enter into payment negotiations with the California Public Employees’ Retirement System (CalPERS) and other creditors to expedite a restructuring plan, and the ongoing battle over pension rights is expected to take several months to resolve. City officials are expected to propose a plan that greatly reduces pension benefits for retirees and existing workers, despite CalPERS’ assertion that the state constitution fully protects and prioritizes pension rights. CalPERS is currently the city’s largest creditor.
Bankruptcy Judge Meredith Jury said that the October deadline to propose an outline is designed to streamline the process.
“The primary purpose (of Wednesday’s hearing) was because the answers that I was getting from the city about when it might have some kind of draft, terms sheet … were not satisfactory to the court,” said Jury, according to the San Bernardino Sun. “I was hoping to move quicker.”
Jury also noted that she would not place any restrictions on which topics could be discussed during the mediation process, giving creditors and city officials more flexibility in reaching a potential resolution. In addition, the timeline may also give residents the ability to provide their input at city council meetings, particularly as essential public services are in jeopardy.
A similar fight is brewing in Detroit, which is currently facing challenges to its bankruptcy eligibility from creditors as well as significant opposition to its plan to reduce pension benefits. As the war over pension rights intensifies, upcoming rulings on cities’ obligations to honor these benefits will be uniquely impactful on future municipal bankruptcy cases.
- Practices: Bankruptcy & Creditors' Rights, Corporate Transactions & Business, Bankruptcy Litigation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Reputational Risk and Legal Exposure: Why New Jersey Businesses Must Manage Them Together
New Jersey businesses must manage legal and reputational risk together because modern disputes play out on two fronts at once: the legal proceeding itself and the court of public opinion, where customers, employees, investors, and business partners often reach conclusions long before a judge or jury has had the opportunity to evaluate the facts. Success […]
Author: Sean M. Pena
Eviction Is Not Always the End: Understanding Post-Possession Rent Claims in New Jersey and New York
No. An eviction does not automatically end a tenant’s obligation to pay rent. Post-eviction rent claims are common because recovering possession resolves who has the right to occupy the premises, but it does not extinguish the tenant’s contractual obligations under the lease. Whether unpaid or future rent remains owed depends on three factors: the lease’s […]
Author: Donald M. Pepe
Company Dissolved? Legal and Financial Consequences to Expect
A company is dissolved; legally, it ceases to exist. Accordingly, dissolution results in significant legal and financial consequences. It is a process that must be properly managed to avoid continuing liability. The Corporate Dissolution Process Corporate dissolution is the legal process of formally closing a corporation, paying its debts and distributing the remaining assets. Most […]
Author: Jay McDaniel
The Legal Implications of Signing a Triple Net Lease
A triple net lease is a commercial lease in which the tenant pays the property’s real estate taxes, insurance, and maintenance costs, known as the three nets, in addition to base rent. They are most often used in freestanding retail and office buildings and in large single-tenant industrial properties, with terms that typically run 10 […]
Author: Donald M. Pepe
When to Settle and When to Fight: A Litigator's Framework
Every lawsuit comes with a cost, and knowing when to settle a lawsuit is one of the most consequential decisions a business owner will face. Experienced litigators understand how to minimize cost and obtain certainty for their clients. For many business owners, the decision is viewed almost entirely through a financial lens: What will it cost […]
Author: Sean M. Pena
What Is Corporate Litigation? A Clear Guide for Businesses
Corporate litigation, also called commercial litigation or business litigation, is the formal legal process through which companies resolve disputes in the civil court system. When a business relationship breaks down and other resolution methods have failed, litigation provides a structured legal mechanism for asserting rights, recovering damages, enforcing obligations, and obtaining court-ordered relief. Unlike criminal […]
Author: Scarinci Hollenbeck, LLC
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.