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Michigan Attorney General to Join Detroit Bankruptcy

Photographer: Al Goldis/AP Photo

Michigan Governor Rick Snyder, right, addresses the media as Attorney General Bill Schuette stands by at a news conference in Lansing, Michigan, on June 5, 2013. Close

Michigan Governor Rick Snyder, right, addresses the media as Attorney General Bill... Read More

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Photographer: Al Goldis/AP Photo

Michigan Governor Rick Snyder, right, addresses the media as Attorney General Bill Schuette stands by at a news conference in Lansing, Michigan, on June 5, 2013.

Michigan’s attorney general joined the Detroit bankruptcy case, two days after announcing he would represent retired city workers by seeking to enforce a clause in the state constitution that shields pensions from cuts.

The filing today in U.S. Bankruptcy Court in Detroit by Attorney General Bill Schuette didn’t indicate whether he was seeking to supplant the private lawyers already hired by the city’s pension systems, to represent a proposed committee of retired city workers or to act in some other capacity.

Today’s move puts Schuette, 59, on both sides of the debate over Detroit’s $18 billion bankruptcy. He has already gone to a state appeals court on behalf of Governor Rick Snyder, a fellow Republican, to defend the bankruptcy filing, which the governor authorized on July 18.

Schuette asked a state appeals court to put on hold a lower court’s July 19 ruling that Detroit’s Chapter 9 filing violated the Michigan Constitution, which says public pension benefits are a contractual obligation that can’t be diminished.

The attorney general said on July 27 that he would join the dozens of lawyers representing city workers, retirees, bondholders and other creditors that are working on the case.

“I will defend the rights of Michigan citizens and defend the constitution of the state of Michigan,” he said in a statement.

Schuette went on to say that he will continue to “aggressively represent” Snyder, who was sued by city pension officials that sought to prevent the bankruptcy.

Joy Yearout, Schuette’s spokeswoman, didn’t immediately return a call for comment.

The case is City of Detroit, 13-bk-53846, U.S. Bankruptcy Court, Eastern District of Michigan (Detroit).

To contact the reporters on this story: Steven Church in Detroit at schurch3@bloomberg.net; Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net

To contact the editors responsible for this story: Andrew Dunn at adunn8@bloomberg.net; Michael Hytha at mhytha@bloomberg.net

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