The Indiana Pensioners recently filed a motion with the U.S. Bankruptcy Court (Southern District of New York) seeking the appointment of a Chapter 11 trustee and the immediate appointment of an examiner in the Chrysler case. Among other things, the motion states, "It is imperative that this Court appoint a Chapter 11 trustee to ensure that an independent, disinterested person makes business decisions that are in the best interests of these estates and that are in keeping with their statutory fiduciary duties to stakeholders."  The motion further asserts that this remedy is warranted "by the unprecedented degree to which the Debtors have been unable or unwilling to perform their basic fiduciary responsibilities in the face of pressure and instruction from the U.S. government to do otherwise."  According to the Indiana Pensioners' motion, the Debtors have ceded control over their business and their restructuring efforts to the United States Treasury Department which is, in turn, allegedly attempting to use these bankruptcy cases as a device to impose "a sub rosa plan of reorganization that improperly rewards creditor groups the government deems politically important to the detriment, and at the expense of, Chrysler's Senior Secured Lenders." According the motion, the Debtors are ignoring fundamental principles of bankruptcy law by allocating distributions according to the government's political agenda rather than the creditors' legal priority.  As asserted in the Indiana Pensioner' filing:  "So defective is the strategy that if it were presented in a Chapter 11 plan, and subjected to all the creditor protections afforded thereby, it clearly could not be confirmed."  Judge Arthur J. Gonzalez' docket indicates that he is scheduled to hear several motions in the Chrysler Chapter 11 case this week, although it is unclear at this time when the Indiana Pensioners' motion will be heard.

     Chrysler filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York on April 30, 2009.  Both the White House and Chrysler expressed hope for a "surgical" bankruptcy lasting 30 to 60 days, with the result of reducing the company's liabilities and post-bankruptcy emergence in stronger financial shape.

-Drew Broaddus