Bankruptcy Judge Steven Rhodes had harsh words yesterday for attorneys fighting for a lofty insurance policy to protect members of a retiree committee from legal backlash associated with Detroit’s chapter 9 case, the Detroit News reported today. The nine-member committee of retirees, appointed to represent former city workers in the bankruptcy case, want taxpayers to underwrite the $602,250 insurance policy, a “necessary” expense, of their unpaid service. But the city, which requested the committee be formed and is footing its attorney bills, opposes the request for the “errors and omissions” liability insurance that would come out of the financially insolvent city’s coffers. While sympathetic to concerns of committee members, Judge Rhodes was critical of the request, noting that the proposed funding pot could better be used to pay for police officers, EMS workers or firefighters in the “service delivery insolvent” city. The amount, he added, appears to be “grossly disproportionate” to what would actually be needed.
