The September 17, 2013 article below, written by Robert Snell of the The Detroit News, is an example of the use of mediation teams in different forums. In the Detroit Bankruptcy proceedings, a team of jurists and lawyers have been selected to assist the parties in working to resolve various complex problems with issues such as the pension plan, union issues and other related matters. This is a trend that will continue to evolve.
Brian P. Battaglia, Florida Supreme Court Certified Circuit and County Court Mediator,
Brian P. Battaglia, P.A. and Bay Mediations, St. Petersburg, FL.
727-327-4222
______________________________________________________________________
By Robert Snell of the The Detroit News, September 17, 2013
Mediator tells Detroit creditors:
‘Open your minds’
Team of judges will try to settle disputes over debt restructuring
By: Robert Snell
The Detroit News
Emergency Manager Kevyn Orr and about 90 lawyers representing city pension funds, unions, retirees, the state and bondholders attended the first joint mediation session at federal court in downtown Detroit on Tuesday.
Emergency Manager Kevyn Orr and about 90 lawyers representing city pension funds, unions, retirees, the state and bondholders attended the first joint mediation session at federal court in downtown Detroit on Tuesday. (David Coates / The Detroit News)
Detroit— The city and dozens of creditors launched negotiations Tuesday in hopes of striking deals that could speed the Detroit bankruptcy case.
Emergency Manager Kevyn Orr and about 90 lawyers representing city pension funds, unions, retirees, the state and bondholders attended the first joint mediation session at federal court in downtown Detroit. The head mediator, Chief U.S. District Judge Gerald Rosen, urged creditors — many of whom complained the city failed to negotiate before filing Chapter 9 bankruptcy in July — to reach agreements to restructure debt.
“This is about the future of the city and this region,” Rosen said. “Open your minds to areas where we can reach agreements.”
Rosen was flanked by his team of mediators, including several judges from across the country who will lead negotiations with various creditors involved in the biggest municipal bankruptcy case in U.S. history. Negotiations will continue in the weeks ahead before all parties return to Detroit for additional talks Oct. 8-9.
In an effort to keep Detroit’s bankruptcy from getting mired in protracted and expensive litigation, U.S. Bankruptcy Judge Steven Rhodes has promoted the use of mediation to settle disputes over $18 billion in city debt and the city’s limited resources to pay its bills and long-term obligations.
The mediation sessions could help Detroit craft a plan of adjustment with creditors that is essential to the city emerging from bankruptcy court. First, however, Rhodes must determine whether the city is eligible for Chapter 9 bankruptcy relief; a trial is set for late October.
“As difficult and challenging as the issues are, the alternative to an agreed-upon plan of adjustment … is horrendous,” Rosen said.
The mediation sessions are closed to the public and confidential.
Orr sat in the front row of Rosen’s courtroom with his legal team.
Rosen will be the point-person for negotiations with the city and state and shuttle among talks with various creditors. He announced Tuesday the following assignments for his mediation team:
■ Portland, Ore.-based U.S. Bankruptcy Judge Elizabeth Perris will mediate a dispute between the city and bondholders, including those opposed to a proposed settlement of about $250 million in debt on interest rate swaps with banking giants UBS and Bank of America.
The city is seeking a quick resolution to the dispute in an effort to slash about $50 million in annual debt payments and free up $11 million in casino tax revenue to spend on public safety services. At issue in the disputed settlement is one insurer of Detroit’s pension debt, Syncora Guarantee, which is trying to lay claim to the casino money.
“This is a procedure; it’s not going to happen overnight,” Perris told the group.
■ Detroit attorney Eugene Driker, a 50-year veteran lawyer and dean of the Michigan bar, will mediate disputes involving the city’s pension funds.
“No matter how imposing the task, if you keep talking, and people want to participate, you can come to a solution,” Driker said.
■ U.S. District Judge Wiley Daniel of Colorado was assigned to talks involving retirees.
“At the end of the day, the future of the city and the region is at stake,” Daniel said.
■ U.S. District Judge Victoria Roberts will handle mediation with unions, including the UAW and the American Federation of State, County and Municipal Employees.
“I know we are going to have some difficult moments but the best alternative is a negotiated agreement for all of us,” Roberts told the group.
■ Retired U.S. Bankruptcy Judge David Coar of Illinois will mediate disputes involving the Detroit Economic Growth Corp. and Downtown Development Authority.
“I am trying to get people to do what they don’t want to do,” Coar said. “It will be tough, it will be emotional at times. But if you are willing to come up with a fair solution, this is an opportunity for Detroit to be greater than it has been in the past.”
rsnell@detroitnews.com
(313) 222-2028
From The Detroit News: http://www.detroitnews.com/article/20130917/METRO01/309170085#ixzz2fHG7mRqD