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Detroit defeats appeal over bankruptcy pension cuts
October 3, 2016 / 5:31 PM / a year ago

Detroit defeats appeal over bankruptcy pension cuts

Oct 3 (Reuters) - A divided federal appeals court on Monday ruled in favor of Detroit in a lawsuit by retirees who complained that their pensions were cut improperly to help the city end its bankruptcy.

By a 2-1 vote, the 6th U.S. Circuit Court of Appeals said restoring the pension cuts would unravel Detroit’s 2014 emergence from bankruptcy, and that the potential harm to the city and its residents was too great.

“This is not a close call,” Circuit Judge Alice Batchelder wrote for the majority.

Thousands of workers had seen their pensions reduced by 4.5 percent as part of Detroit’s reorganization.

Circuit Judge Karen Nelson Moore dissented, saying the majority’s approach would leave unhappy retirees “with the impression that their rights do not matter.” (Reporting by Jonathan Stempel in New York; Editing by David Gregorio)

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