Supreme Court Justice Ruth Bader Ginsburg has ordered that the sale of Chrysler to Fiat is “stayed pending further order,” reports the AP. “Was TARP money used illegally?” asks the WSJ Deal Journal. It won’t be easy to prove, is the professorial opinion. Oh, and did we mention that the Obama administration has filed a brief (PDF via the excellent scotusblog) against the initial plea, arguing that TARP issues are out of bounds for the courts? Meanwhile, Fiat’s walk-away deadline of the 15th draws closer every minute. Hit the jump for Bader-Ginsburg’s inscrutable order (and more! Thanks for the tips!).
UPON CONSIDERATION of the application of counsel for the applicants, and the responses filed thereto, IT IS ORDERED that the orders of the Bankruptcy Court for the Southern District of New York, case No. 09-50002, dated May 31 and June 1, 2009, are stayed pending further order of the undersigned or of the Court.
TTAC contributer Richard Tilton tells the Wall Street Journal:
“We will probably see a request from Chrysler for an expedited briefing on whether the court should hear the appeal. The Supreme Court must still decide if they want to hear the appeal. I think this will now cast doubt on how the government is trying to restructure General Motors through the bankruptcy process.”
Scotusblog mulls the possibilities:
“Ginsburg or the Court may be waiting to see how the Second Circuit explains its decision to uphold the terms of the sale. The Circuit Court issued no opinion on Friday, indicating that such an explanation would come “in due course,” although the expectation was that one or more opinions would emerge from those judges on Monday.”
“The wording of Ginsburg’s order — “stayed pending further order” — is the conventional way by which a Justice or the Court carries out an action that is expected to be short in duration, and not controlling — or even hinting at — the ultimate outcome. Any speculation that her order meant the Court was leaning toward a further postponement would be unfounded.”
!!!
Awesome.
Friday is the deadline for the Fiat merger, so this delay had better be short. Maybe the Chrysler Death Watch still has some “life” left:)
Darn, I was hoping to get my new Fiat Malibu in 2010. Dang.
First thing that ignorant fool did right.
Surprised she went up against her Obama Master…I guess it is just part of the political charade…Nothing will come of it.
Bad legal precedent vs. dubious deal. Ugh.
At least if the Fiatsler deal falls through, there are only a handful of Zombie Watch articles to rename.
Mr. Sparky :
June 8th, 2009 at 5:09 pm
Friday is the deadline for the Fiat merger, so this delay had better be short. Maybe the Chrysler Death Watch still has some “life” left:)
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Trust me. Fiat won’t walk away from the deal, even if it’s delayed. Fiat needs the promised billions, or it will go belly up itself.
The same fate fell upon many of the NRA schemes during the Depression. When the PTFOA rushed through the cram down I doubt that they properly dotted each i and crossed every t with regards to the law.
Maybe the dealers will get their day in court as well.
Yes!! Hopefully Fiat pulls out of this debacle! Ruth Bader Ginsburg, I could kiss you! (Well, in theory)
Well done, Lady!
BTW, Ed (or RF), [regarding the stock quote in black] GM shares now trade under the symbol GMGMQ (up 40% today! WTF*100!!). OTOH, listing GM at $0.00 is probably a more accurate reflection of the company’s worth…
GMGMQ is up because of this news. The stock holders will likely have a larger slice of the new GM pie, if the supreme court rule in favor of the pension funds.
@Mr. Sparky:
I think the deadline is actually Monday (article says the 15th), not Friday.
@paradigm_shift:
Kissing Ruth Bader-Ginsburg? Please restrain yourself! This is a family site. And I haven’t quite digested my lunch.
@all:
2 questions:
(1) Is Richard Mourdock running for governor?
(2) I don’t think Mopar has any plants in Indiana, so Mourdock really has nothing to lose. If there were plants, it’d be an interesting calculation if losing the income taxes, etc. from the workers would be more than losing the bonds.
Clear this shyte up, and get me my MiTo. I’m gettin’ impatient.
afabbro, Kokomo, Indiana is where Chrysler’s main US transmission plants are and Fiat liked what they saw there.
She looks like she eats little children.
jolo:
“afabbro, Kokomo, Indiana is where Chrysler’s main US transmission plants are and Fiat liked what they saw there.”
According to Allpar, it’s the largest aluminum die casting plant in the world.
Also Autoblog is reporting that Chrysler will buy back the inventory of the closed dealers and redistribute them to the ones who survived the cut.
Could it be they knew this was coming and wanted to remove another noisy politically connected faction (the dealers) while they dealt with this potential speed bump?
Sorry, next Monday is the deadline instead of Friday.
Apparently, I cannot operate complex devices like calendars:)
Even zombies can die under the proper circumstances, so I wouldn’t think the zombie watch series would need renaming. :)
Maybe this is what Fiat has been hoping for recently. Then they can throw up their hands and say the SCOTUS scuttled the deal.
I live in Indiana and have worked at the main Kokomo Chrysler Transmission plant in the early 90’s. I believe it may be the largest transmission plant in the world. There are 2 other newer plants and the foundry in Kokomo.
Just down the road (in Tipton Indiana) is the currently defunct Getrag transmission plant that was going to make dual clutch transmissions for Chrysler (using some Chrysler technology). That plant is now dead and the subject of some claims by a Tipton county government agency.
The treasurer of the state of Indiana is not on a lark. He has a fiduciary responsibility to see after the pension funds and the one investment fund. But he also has constituents who work at Chrysler who are very interested in an operating Chrysler.
Finally some drama in the C11 realms.
Interesting that the first person to show some balls and stand up to Obama’s 4th-and-Goal was a woman.
FIAT stands to get the Jeep brand, manufacturing plants, a sales network, and access to billions of free U.S. and Canadian taxpayer money, all for $1. I can’t imagine it walking away from the deal.
This is a joke – Fiat already said that June 15 means nothing. Let the court go through the motions. Pun intended.
Damn…there goes my Fiat Panda
Marchionne isn’t going to walk away from all the free money and ego boosting that comes with taking over Chrysler. No matter what happens, our tax money is spent, the best we can hope for now is that we don’t have to put in any more. I fear the only outcome of this will be a bigger payout to the secured bondholders.
@afabbro :
June 8th, 2009 at 6:08 pm
We have 3 operational transmission plants in Kokomo and a 4th semi complete plant a few minutes south of Kokomo.
This is encouraging, let’s see if they will hear it though.
This has nothing to do with a decision by Ginsburg directly, she has responsibility for handling emergency appeals from the New York district and so the bankruptcy court handling Chrysler.
I wish we had a Wise Latina perspective on this.
I’m nearly speechless!
Hope it lasts (the Law standing up to the Man, that is)
Any speculation that her order meant the Court was leaning toward a further postponement would be unfounded.
While I’m too am hopeful that the SCOTUS busts a cap in the head of Fiatsler via a delay, I defer to the experts with the above quote. Ginsburg’s ruling is a formality – the fix is still in.
On the right, the court’s conservatives believe in deference to the executive. Legal & IT brains I know consider the whole TARP ball of wax constitutionally suspect, but this is not the vehicle to challenge it.
Luther: “First thing that ignorant fool did right.
Surprised she went up against her Obama Master…I guess it is just part of the political charade…Nothing will come of it.”
Yup, that “ignorant fool,” was Ivy League educated and served as a Federal judge for a dozen years before being named to the Supreme Court some 15 years before Obama was elected, Please, could you tell me what any of your post means?
I will grant you that at 76, she is old-ish, but In what way is she a fool? How is she part of a political charade? And how does a person who has a life-time appointment, and was appointed by a previous president, have the current president as a master?
This was really startling, especially coming from a reliable left vote on the court. TARP and the rules surrounding it are highly suspect constitutionally but no one expects a challenge, certainly not right now. Elements of the Grand Health Care Plan are dubious as well, that might be a bridge too far for the Messiah.
As to poor Chrysler, the only other option is belly up and out of business. FIAT is getting a ridiculously good deal in this, but they have the same problem the others have: Customers need to buy there cars, it’s not good enough to get assets for a dollar or a good luck wish from the administration.
Note how they want these processes to move quickly with little debate and not much transparency. In the 2 hour daily meetings held at the white house polls and news are reviewed for signs of trouble. If someone get’s an idea how to fight this in the SCOTUS there will be trouble.
Remind me again why we could not go C7 and let FIAT pay money for the assets which in turn could be doled out to investors, creditors, and even the UAW?
Oh I get it. This way we have control over things by putting government money in the system. Then we get to dictate pay, operations, products, ownership, etc.
I love how JUST NOW you conservative tools are finding out what its like to be screwed by the establishment triumvirate of Washington, Wall Street, and the for-profit media.
It’s just a stay. The outcome here will make it easier to tell the GM bondholders to fugghedaboutit when their turn comes up.
“Yup, that “ignorant fool,” was Ivy League educated and served as a Federal judge for a dozen years before being named to the Supreme Court some 15 years before Obama was elected, Please, could you tell me what any of your post means?”
You can be an educated fool.
In other words, you have book smarts and street smarts (or common sense). Anyone can have the former and lack the latter.
You can be an educated fool.
Many people who seem like this are more malicious. For example, how would you explain where undereducated people get ideas like this:
This was really startling, especially coming from a reliable left vote on the court. TARP and the rules surrounding it are highly suspect constitutionally but no one expects a challenge, certainly not right now. Elements of the Grand Health Care Plan are dubious as well, that might be a bridge too far for the Messiah.
…
Note how they want these processes to move quickly with little debate and not much transparency. In the 2 hour daily meetings held at the white house polls and news are reviewed for signs of trouble. If someone get’s an idea how to fight this in the SCOTUS there will be trouble.
Usually when you make remotely serious accusations in matters of legality, at a minimum you should be able to refer to a law along with an argument, however poor, of its violation.
Notice how they’re not even trying to cover the minimal standards for decorum.
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In other words, you have book smarts and street smarts (or common sense). Anyone can have the former and lack the latter.
I usually find those with superb logic have the education to go with it.
This is also an issue of trust and honesty. The rule of law implies a level of trust between businesses, investors, workers, etc. as to how interactions should occur. Once the government (or any other party) breaks that trust, there are ripple effects that go beyond the smaller boundaries of this one situation. It’s no different than when businesses interact without the government. Trust and honest matter. (For more thoughts: Honesty in Marketing.)
The rule of law implies a level of trust between businesses, investors, workers, etc. as to how interactions should occur. Once the government (or any other party) breaks that trust, there are ripple effects that go beyond the smaller boundaries of this one situation. It’s no different than when businesses interact without the government. Trust and honest matter.
There’s another more important angle to the trust issues here. When we get “news” from our sources, we need to trust they’re being honest with us.
For example, when they tell us the government breaks the law, and it turns out they were lying, it’s customary to stop trusting such sources.
For some reason, certain people aren’t bothered by this at all. They continue to hold onto the lies. So as you can see, trust often doesn’t matter as much as stubborness.