Detroit's historic bankruptcy trial to begin

By: The Associated Press Email
By: The Associated Press Email

Detroit, Mich. Lawyers for Detroit will attempt to convince a judge with the start of the city's bankruptcy trial that its plans to wipe out billions of dollars in debt should be approved.

The trial begins Tuesday in federal court and comes just over 13 months after Detroit became the largest U.S. city to file for bankruptcy.

Bill Nowling, spokesman for Detroit emergency manager Kevyn Orr, said the city expects to cut $12 billion in unsecured debt to about $5 billion.

Most creditors have endorsed the plan, which includes commitments from the state, corporations and foundations to donate $800 million to soften cuts to city pensions. In return, city artwork would be protected from being sold.

Bond insurer Syncora Guarantee opposes the plan, and says Detroit has unfairly discriminated against financial creditors.

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