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On December 5, 2013, the U.S. Bankruptcy Court for the Eastern District of Michigan released its 143 page decision upholding the City of Detroit’s eligibility to be a debtor under chapter 9 of the United States Bankruptcy Code.  In re City of Detroit, Michigan, Case No. 13-53846 (Bankr. E.D. Mich. Dec. 5, 2013).  The Court’s decision is the first ever to address the treatment of municipal pensions in bankruptcy, concluding that pension obligations may be adjusted in a chapter 9 case, notwithstanding protective provisions in the state constitution.  A similar issue is pending, but not yet decided, in the Stockton and San Bernardino chapter 9 cases in California. https://www.cadwalader.com/resources/clients-friends-memos/court-rules-that-detroit-is-eligible-for-chapter-9-and-that-pensions-may-be-impaired-in-chapter-9