Posted on 06/09/2009 4:28:47 PM PDT by Para-Ord.45
Edited on 06/09/2009 4:38:36 PM PDT by Admin Moderator. [history]
High court won't block Chrysler sale
WASHINGTON (AP) - The Supreme Court has cleared the way for Chrysler's sale to Fiat, turning down a last-ditch bid by opponents of the deal.
The court said late Tuesday it had rejected a plea to block the sale of most of Chrysler's assets to the Italian automaker. Chrysler, Fiat and the Obama administration had warned that the high court's intervention could have scuttled the sale.
A federal appeals court in New York had earlier approved the sale, but gave opponents until Monday afternoon to try to get the Supreme Court to intervene.
Justice Ruth Bader Ginsburg ordered a temporary delay just before a 4 p.m. deadline on Monday.
Excerpt.
We’re investing in rice, beans, ammo, peanut butter, spam, heirloom seeds and more ammo.
“You don’t have to have been harmed already to get a stay - the harm needs to be imminent and irreparable.”
I’m not a legal eagle, but isn’t the opinion simply stating that there were not sufficient grounds for a STAY? They did NOT rule on the merits of the bondholder claims: effectively they are just saying that bondholders still can sue after the takeover by Fiat and there would still be available remedies to make them whole. At some level, the harm to bondholders already has occurred in the prior decision about how to divide up Chrysler. Is there something about the Fiat takeover that would make the damage done irreparable? This is a honest question, not a rhetorical one. I don’t pretend to know the first thing about law or business.
You are correct. It was about 1) the secured bondholders not getting their contractual rights recognized, as you say, and 2) the lawyers for Indiana also argued that the sale was facilitated by an unauthorized use of TARP money.
You are an exemplary FReeper, TexasKate. There are few even on FR who are willing to come back to a thread to say they were wrong.
I applaud you in earnest.
(I could just as easily have been wrong. I didn’t do the research before posting that I thought the number was 4.)
We have 2010. Don't be so demoralized by speed bumps. The fight has only begun
Like with FDR, there is no way to hide the unemployment rate.
It is a sub rosa reorginazation pland - Chrysler creates a new company, sells all of it assets to the new company for pannies on the dollar, and leaves all the debt in the old company.
Illegal as H$LL.
Cheers ... It’s a long fight.
That's a good question and I think the answer is "yes". Under the law, the bond holders were supposed to be in a position where the debt was secured by the assets of the company. My understanding of the Fiat deal is that those assets go away without benefitting the bond holders. Apparently, the rationale was that under TARP, the govt could do whatever the hell it wanted to as TARP trumped all existing laws. I think the refusal to issue a stay finishes any chance of legal remedy for the bond holders.
The 2nd circuit ordered the sale to Fiat/US Government, and it’s that sale which would cause the harm to bondholders, by cheating them out of their contractual first priority as secured creditors. So the case before the Supreme Court started with a request for a preliminary injunction to stop the sale; and then if the Supreme Court granted that preliminary injunction and agreed to hear the case, the final remedy, if the bondholders won, would have been a permanent injunction to stop the sale.
But because the Supreme Court denied the preliminary injunction, the sale is a done deal right now as a matter of law. Chrysler is now a shell. New Chrysler is born.
So now the only possible action left to bondholders, in my opinion, is an after-the-fact Takings action, i.e., “Hey US Government, you took my property. Now you must compensate me.”
Something tells me we’ll see these Fiat models on the road real soon.
http://www.fiat.co.uk/Showroom/
Let me try again - Chrysler went bankrupt, and their house is being sold at auction by the sheriff.
By law, the sheriff must sell the house to the highest bidder, and use the proceeds, first, to pay off the mortgage.
Instead, he sold the house to the maid in a rigged deal, then paid off the maid’s back wages with the proceeds, and put a big chunk aside for the maid’s retirement fund.
And he told the mortgage company, “I won.”
You see?
The irreperable harm is, the sheriff is immune from being sued, and so is the maid!
As for chrysler? as of the momment of the sale, it no longer exists.
What is God has to do with the evil of socialism?
Ditto. Any good tips on non-hybrid seeds? $220 seems pretty steep for one acre’s worth.
Thanks.
One question:
“the sale was facilitated by an unauthorized use of TARP money”
I don’t understand how the TARP funds are involved. How did the funds facilitate the sale?
I predict they will have the same success as the old Soviet Union produced cars did ... none.
But to make things fair, lets force all the Congress critters and bureaucrats to drive or ride in one with no options.
Suicide clown cars, who would be dumb enough to actually work and spend their money on this piece of crap. Maybe that’s why no one has sen one of these on the road for decades.
That’s actually excellent.
That’s the best, clearest and most precise explanation of what just happened. And I’ve been reading everything; MSM financial articles, legal blogs, etc.
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