Detroit and San Bernardino Test the Outer Limits of U.S. Bankruptcy LawNovember 22, 2013 – In The News
Michael Sweet was quoted in the Debtwire article "Detroit and San Bernardino Test the Outer Limits of U.S. Bankruptcy Law." While the full text can be found in the November 22, 2013, issue of Debtwire, a synopsis is noted below.
“Equitable mootness” is not a frequently heard phrase, but according to restructuring attorneys, it could emerge as a powerful influence in current and future municipal bankruptcies.
Equitable mootness essentially means that once a bankruptcy court confirms a debtor’s plan for reorganization, a higher court wont overturn it.
“Equitable mootness is a real possibility,” Michael Sweet said regarding the San Bernardino, California bankruptcy. “Not for any other reason but mainly because you have conflicting interests: the interest of moving the city forward and getting a plan confirmed and the interest of getting a higher court to rule.”