Lawyers for the city want the courts to disband committees set up to represent unsecured creditors in Detroit's bankruptcy process because, they argue, those creditors are already capable of representing themselves.
Detroit News: In December, Detroit told the U.S. Trustee it was opposed to the appointment of an official committee of unsecured creditors and said it would not fund any fees or expenses incurred by the committee. The city argues major creditors are already well represented by attorneys — and says creditors like those awaiting income tax refunds don’t need representation, since they will receive their full refunds.
The city separately asked for the appointment of a committee to represent retirees, since some are not represented by unions involved in the bankruptcy.
Detroit's bankruptcy attorneys argue the special creditor committees could negatively impact the progress of federal mediators working to expedite the city's exit for bankruptcy.
